News Archive

"The provisions included on the 2026 Cumulative List mostly relate to changes in law as a result of the SECURE Act, the CARES Act, and the SECURE 2.0 Act (along with some other changes along the way)."  MORE >>

"[We] still do not know if changing the beneficiary of the 529 account resets the 15-year clock. Will the existing time period applicable to the initial account opening carry over to the new beneficiary? No one on the planet has that information. Accordingly, advisors and custodians alike have been advising clients to leave the 529 beneficiary as-is until confirmation is received as to how the 15 years will be applied."  MORE >>

"Following a significant increase from 2025 to 2026 and a surprise decrease from 2024 to 2025, the penalties will once again increase substantially in 2027. The (a) penalty will be $3,780 (up from $3,340 in 2026), and the (b) penalty will rise to $5,670 (up from $5,010)."  MORE >>

"Section 419 plans, marketed as legitimate tax deduction vehicles funded by whole life insurance, have been classified by the IRS as abusive tax shelters and consistently rejected by the courts. Plan sponsors face a 100% excise tax on disqualifying dispositions, leaving few legitimate exit strategies for those stuck with large insurance policies held in trust. Transferring plan sponsorship to a related entity that is then sold to a third party with legitimate welfare plan expenses may be the most viable option, though professional guidance is essential."  MORE >>

"Plan committees should evaluate whether their current fiduciary process, including investment review and selection framework, generally aligns with the proposed six‑factor analysis, particularly with respect to the rationale documented in committee minutes. Plan fiduciaries should consider with their ERISA counsel and investment advisor what preparatory steps, if any, may be appropriate in anticipation of the proposed regulations being finalized, including with respect to fiduciary process, committee documentation, and investment policy statements."  MORE >>

"Resolving a circuit split, the U.S. Supreme Court ... held that actuarial assumptions used to calculate withdrawal liability may be selected after the measurement date. The Court reasoned that actuarial assumptions are forward-looking 'predictive judgments,' and ERISA does not impose a deadline requiring them to be set before the measurement date." [M&K Employee Solutions, LLC v. Trustees of the IAM National Pension Fund, No. 23-1209 (S. Ct. May 21, 2026)]  MORE >>

"You are receiving this Form 1095-C because your employer is an Applicable Large Employer subject to the employer shared responsibility provisions in the [ACA]. This Form 1095-C includes information about the health insurance coverage offered to you by your employer." [Also available: Draft of 2026 IRS Form 1094-C: Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns]  MORE >>

"[1] Withdrawal liability may be higher -- and less predictable -- than you expect.... [2] Arbitration remains your primary remedy.... [3] Engage actuarial and legal advisers early.... [4] Monitor plan communications closely." [M&K Employee Solutions, LLC v. Trustees of the IAM National Pension Fund, No. 23-1209 (S. Ct. May 21, 2026)]  MORE >>

"Changes to essential health benefits standards: more defrayal by states and no more adult dental services ... Some states could get surprise bill for benefits defrayal ... Pausing review of state EHB benchmark plan applications ... Prohibiting the coverage of adult dental services as EHB ... Deferring to states on network adequacy and essential community providers ... Allowing non-network plans."  MORE >>

"Although Code Section 6039D requires employers to file annual returns for cafeteria plans, the IRS suspended that requirement in 2002. Nevertheless, the DOL's Form 5500 requirement continues to apply to many employee welfare benefit plans that are governed by ERISA. A cafeteria plan is merely a funding vehicle for its component benefit plans and is not itself an ERISA employee welfare benefit plan, but component plans that are ERISA plans (e.g., medical plans or health FSAs) must file Form 5500s unless exceptions apply."  MORE >>

"The U.S. Chamber of Commerce and the American Benefits Council filed a joint amicus brief ... asking the U.S. 4th Circuit Court of Appeals to set aside the ERISA class certification approved by a district court in a lawsuit involving the 401(k) pension plan of the National Rural Electric Cooperative Association....[The lawsuit was filed] by two current plan participants, representing a class of more than 77,000 participants.... The plaintiffs accuse NRECA and its fiduciary committee of breaching obligations under [ERISA] and charging the multiple employer plan's participants excessive administrative fees." [Mullins v. NRECA, No. 25-0994 (E.D. Va. Mar. 13, 2026; on appeal to 4th Cir. No. 26-0165)]  MORE >>

"The decision confirms the DC Circuit's view that plans need not have actuarial assumptions in place on the measurement date. The Supreme Court did not decide whether those assumptions must rely only on information available as of that date." [M&K Employee Solutions, LLC v. Trustees of the IAM National Pension Fund, No. 23-1209 (S. Ct. May 21, 2026)]  MORE >>

"As required by statute, the [DOL] annually publishes a final rule updating the civil monetary penalties it assesses. The Bureau of Labor Statistics (BLS) did not publish its October 2025 Consumer Price Index for All Urban Consumers (CPI-U) data due to a lapse in funding. Because the relevant law requires that annual penalty adjustments be based specifically on October CPI-U data -- with no alternative calculation allowed -- the 2026 adjustment is cancelled entirely."  MORE >>

"The law will be phased in over time, applying to employers based on size ... Employers must provide all Virginia employees, including part-time employees, with up to 40 hours per year of paid sick leave.... Paid sick leave accrued by employees in a prior year must be carried over to the next year.... Leave must be paid at the employee's regular rate of pay.... Employers that already provide employees with at least 40 hours per year of paid time off (PTO) do not need to provide additional leave under the law."  MORE >>

"Employers must post notices in accessible locations. The update gave examples of possible location ... Rules clarify three main requirements: accrual/grant, carryover, and usage.... The updated rules provided an example with a formula to guide employers' determination of the rate of pay."  MORE >>

"[T]he Eleventh Circuit reversed the district court's Rule 12(b)(6) dismissal of all four counts of the operative complaint, holding that ERISA's 'actuarial equivalent' requirement for joint-and-survivor annuities imposes substantive limits on the mortality and interest-rate assumptions plans may use, and that Section 1055(i) likewise caps preretirement survivor annuity (QPSA) charges at amounts that reasonably reflect a plan's increased costs of providing the benefit." [Drummond v. Southern Company Services, Inc., No. 24-12773 (11th Cir. May 26, 2026)]  MORE >>

"[T]he Fourth Circuit affirmed the dismissal of a class action in which Plaintiffs attempted to collect a federal judgment against a defunct employer by suing a private equity firm and fifteen related individuals and entities on alter ego and veil-piercing theories.... The Fourth Circuit concluded that because Plaintiffs' suit was based exclusively on veil-piercing and alleged no new or additional ERISA or WARN Act violations, and because their voluntary dismissal of Garrison from the original suit resulted in a judgment against BCI only, the district court correctly held that it lacked federal subject matter jurisdiction." [Messer v. Garrison Investment Group, LP, No. 25-1657 (4th Cir. May 26, 2026)]  MORE >>

"An employer seeking to challenge actuarial assumptions can still request review and demand arbitration, at which point it is now even more critical to press the actuary on the information relied upon to develop the assumptions used to calculate the pension fund's unfunded vested benefits. To the extent an actuary relies on information that becomes known only after the measurement date in developing an assumption, or the assumption is otherwise unreasonable, that assumption is impermissible." [M&K Employee Solutions, LLC v. Trustees of the IAM National Pension Fund, No. 23-1209 (S. Ct. May 21, 2026)]  MORE >>

"Self-funded group health plans implicate HIPAA ... Ransomware is treated as a presumptive breach ... A thorough and comprehensive risk analysis is critical in the wake of a breach ... Questions employers should be asking: [1] Do we have policies and procedure in place for HIPAA Privacy and HIPAA Security? [2] What about Breach Notification protocols? [3] Are employees with access to PHI completing HIPAA training annually? [4] Do we have a written incident response procedure that addresses ransomware scenarios and HIPAA breach notification timelines?"  MORE >>

"CVS has filed suit to challenge a Tennessee law that would bar pharmacy benefit managers from owning pharmacies in the state.... [In] the lawsuit, CVS argues that the law is designed to target out-of-state players like them while privileging in-state organizations." [CVS v. Tennessee Board of Pharmacy, No. 26-9999 (M.D. Tenn. complaint filed May 22, 2026)]  MORE >>

"Higher default contributions, broader auto‑increase adoption, periodic auto‑reenrollment, and emergency savings defaults can increase participation, reduce leakage, and improve adequacy. From a policy perspective, encouraging age‑based default contribution rates and increasing the pension‑linked emergency savings account (PLESA) cap could improve outcomes."  MORE >>

May 21, 2026. "Attach to Form 1040, 1040-SR, 1040-NR, or 1041.... If you only owe the additional 10% tax on the full amount of the early distributions, you may be able to report this tax directly on Schedule 2 (Form 1040), line 5, without filing Form 5329."  MORE >>

10 pages. "Simply matching prior fully insured premiums rarely reflects the true cost structure of a self- funded plan. Claims volatility introduces both risk and opportunity. Favorable experience can generate surplus and long-term savings, whereas adverse experience can create short-term funding pressure. Establishing an appropriate funding margin and surplus policy helps stabilize results and ensure the plan's financial sustainability across multiple years."  MORE >>

"The new legislation aims to level the playing field. By restricting the power of PBMs....[The] Act would: [1] Give patients more choices in where they get their medication, ending the practice of steering customers to PBM-owned pharmacies. [2] Standardize drug payments so that pharmacies are reimbursed fairly, regardless of their size or ownership. [3] Increase transparency in drug pricing[.]"  MORE >>

"Employers might have to pay much more in the future when withdrawing from multiemployer pension plans. In a unanimous decision ... the U.S. Supreme Court ruled May 21 that actuarial assumptions for calculating withdrawal liability may be adopted after the last day of the plan year preceding the employer's withdrawal from the plan -- a decision that in this case could result in a payment six times greater than what the employers thought they owed." [M&K Employee Solutions, LLC v. Trustees of the IAM National Pension Fund, No. 23-1209 (S. Ct. May 21, 2026)]  MORE >>