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GAO Report: Little Information Available on Qualified Supplemental Executive Retirement Plans

23 pages. "[Some defined benefit retirement] plan sponsors have designed ways to indirectly transfer ... nontax-qualified supplemental executive benefits into their existing tax-qualified DB plans ... by increasing the benefits under the qualified plan, with an offsetting reduction in the benefits under the nonqualified plan.... These arrangements, commonly referred to as Qualified Supplemental Executive Retirement Plans (QSERP), can provide HCEs with a higher qualified benefit amount, the tax advantages provided by a qualified plan, as well as the increased benefit security provided by the backing of qualified plan assets." [GAO-11-533R, published May 12, 2011, released Jun. 13, 2011]

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Ohio Board of Tax Appeals Finds Supplemental Executive Retirement Plan Excludable from Income for Local Income Taxes (PDF)

"The decision may create refund opportunities.... In the ruling, a pension was described as any plan sponsored by an employer that provides for post-retirement income that's designed to supplement their income for life. After reviewing a number of factors the BTA recognized that although SERP fell within the scope of a nonqualfied deferred compensation plan, such designation did not preclude it from also being defined as pension income which is excludable under the subject municipal law."  MORE >>

How to Use a Supplemental Executive Retirement Plan

"There is no limit on the amount that can be contributed to a SERP, so the retirement payout could be substantial.... [A] SERP can be customized for each covered employee.... [If] the company structures the plan as a life insurance policy, taxes are not paid on the contributions from either the employer or executive until retirement. The plan can be especially beneficial for employees at privately held companies."  MORE >>

Early Retirement Supplement Found to Be a 'Protected Benefit' Due to Plan Drafting

"An employer's defined benefit pension plan defined 'accrued benefit' to include early retirement supplemental benefits. However, the plan was amended to eliminate the early retirement supplemental benefit. A participant erroneously received payment of the early retirement supplemental benefit after the amendment and was asked by the employer to repay it to the plan. The employee claimed that elimination of the supplement violated ERISA's 'anti-cutback' rule."

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Nudging Retirement Savings: A Field Experiment on Supplemental Plans

"Among workers participating in a supplemental plan, individuals who received an informational nudge increased their contributions in the months following the intervention relative to the control group. Moreover, those that received the nudge reported in a subsequent survey that they were more likely to have developed a retirement plan and report more confidence in their retirement preparedness. In contrast, individuals who were not enrolled in a retirement saving plan were not moved to begin contributing to a supplemental plan."

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Supplemental Plan Offerings and Retirement Saving Choices: An Analysis of North Carolina School Districts

"Unlike private sector employers, public school districts generally offer more than one type of supplemental retirement savings plan and allow multiple vendors to offer products.... [T]his study examines the impact of inter-district differences in supplemental plan administration on participation in these savings vehicles. [The authors] find wide variation in total participation rates and in 403(b) plan participation rates in particular, even among this population of public-sector workers with the same defined benefit pension plan, health plan, and retiree health coverage."

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The Importance of Supplemental Retirement Savings Plans for City and County Employees (PDF)

"The most frequently offered plan is a 457 plan.... Workers covered by less generous primary pensions are more likely to contribute to voluntary supplemental retirement plans. City or county governments that give matching contributions, have multiple plans, and allow online enrollment also have higher participation rates in supplemental plans."  MORE >>

How to 'DB-ize' Your Supplemental DC Retirement Plan (PDF)

"[F]inance and human resources staff in the public sector have begun to analyze how to encourage greater participation in supplemental plans and to improve savings outcome ... Much of the effort centers around making defined contribution plans look more like defined benefit plans, referred to as 'DB-ization.' Under this approach, plan design takes into account the limited experience and interest many employees have in regards to their own retirement savings and incorporates several tools that can ease decision making for employees."  MORE >>

DOL Begins to Act Under the New Executive Order Aimed to Increase Alternative Investments in Retirement Plans

"[T]he 2020 Letter is no longer qualified by the Supplemental Statement, and although that change, in and of itself, does not appear to permit plan sponsors to immediately offer asset allocation funds with a private equity component as investment options with impunity, it is the first step towards a significantly more open environment."  MORE >>

Illinois Teachers' Retirement System Supplemental Savings Plan Update

"On January 10, 2022, teachers will be able to begin submitting applications to the Illinois Teachers' Retirement System (TRS) to participate in TRS's new Supplemental Savings Plan which is a tax-deferred compensation program under Section 457(b) of the United States Internal Revenue Code. Payroll deductions for participants are expected to start in March, 2022."  MORE >>