BenefitsLink logo
EmployeeBenefitsJobs logo

Subscribe to Newsletters



Search the News


Featured Jobs
DB Administrator
ESOP Administrator
Actuary
Manager, Client Services
TPA Sales Consultant
Senior Account Analyst
Defined Contribution Consultant
Search all jobs
 
Get the BenefitsLink app for iPhone and iPad LinkedIn
Twitter
Facebook
<< Older News   |  June 26, 2017

Benefits in the News



IRS Reopening Preparer Tax Identification Number (PTIN) System, Waiving Charges
Internal Revenue Service [IRS]
[Official Guidance]
June 23, 2017
"On June 1, 2017, the United States District Court for the District of Columbia upheld the [IRS]'s authority to require the use of a Preparer Tax Identification Number (PTIN), but enjoined the IRS from charging a user fee for the issuance and renewal of PTINs. As a result of this order, PTIN registration and renewal was suspended on June 2. The IRS, working with the Department of Justice, is still considering how to proceed, but will make PTINs available while deciding how to address the court order. The IRS is resuming the issuance of PTINs, without charge, on June 21, 2017."
Text of IRS Chief Counsel Memorandum: Application of Section 409A to Back-to-Back Arrangement (PDF)
Internal Revenue Service [IRS]
[Official Guidance]
June 23, 2017
10 pages. "Treas. Reg. Section 1.409A-3(i)(6) provides that the amount of the payment under the ultimate service recipient plan may not exceed the amount of the payment under the intermediate service recipient plan. Therefore, the USR Plan fails to meet the requirements of section 409A because the USR Plan provision providing for a payment to Taxpayer in the event of a Participant's separation from service before vesting is an impermissible payment event." [CCM 201725027, Mar. 6, 2017, published online June 23, 2017.]
The Senate Healthcare Bill: Implications for Employers
Mercer
[Opinion]
June 23, 2017
"We are wary of changes that could induce states to opt out of major parts of the ACA ... The bill continues CSR payments through 2019.... [Z]eroing out the individual mandate penalty and not including a continuous coverage requirement ... may further destabilize the individual market.... Repeal of Medicaid expansion along with funding cuts still signals potential cost shifting to private payors.... HSA expansion in 2018.... Excise Tax delayed; many other ACA taxes repealed."
Let's Make an 'I-Deal'? When Employees Want Special Benefit Arrangements
Society for Human Resource Management [SHRM]
June 23, 2017
"Employees often try to negotiate with their employers arrangements that take into account their individual needs -- such as asking for more-flexible work hours, a reduced workload, more pay or special training. These arrangements ... are sometimes in the interest of both the employee and employer, especially if such deals make employees more motivated and committed to their jobs.... [Co-workers] are more likely to understand when a company grants nonfinancial benefits because of an employee's personal needs ... Justifying financial rewards, however, is more difficult[.]"
Comparing Major ACA Provisions to the House and Senate Replacement Proposals
Benefit Revolution
June 23, 2017
"The Senate absolutely did not 'start over' but simply made a few tweaks to the Obamacare Lite bill passed by the House.... If you didn't think the House bill went far enough to repeal Obamacare, you will really hate the Senate bill because, on the whole, it backtracks a few steps toward Obamacare." [Includes a detailed chart comparing provisions of the ACA, the House bill, and the Senate bill.]
There's No Crying at Work! But If an Employee Does Cry, Is That Sufficient Notice of the Need for FMLA Leave?j
FMLA Insights
June 23, 2017
"Noting that that the FMLA notice requirement for employees is 'not demanding,' the court found that the employee herself may not even be aware she is suffering from a serious health condition.... The 'notice' here is not just the crying.... If all she did was cry, as strange as that might have been, it would have difficult for Noemi to establish that she put the employer on notice of the need for FMLA leave. However, she didn't stop there. She also made clear that she was 'confused and overwhelmed, had not slept or eaten in weeks, and was losing weight.' " [Valdivia v. Township High School Dist. 214, No. 16-10333 (N.D. Ill. May 15, 2017)]
The Retirement Wellness Media: Separating Fact from Fiction
Benefits and Compensation with John Lowell
[Opinion]
June 23, 2017
"We cannot have record numbers of people deferring to 401(k) plans at record rates and yet still have almost universally low-five figure account balances, on average. At least we cannot unless we also have record amounts of leakage via plan loans, withdrawals, and both deferral and work stoppages.... 74% of respondents to a question said that lifetime income is important, but only 25% thought they had a way to generate it.... But, having reached the holy grail of retirement, these same people now want to do all the things they dreamed of while working.... There is a problem with all of that. Those expenses are pretty front-loaded."
Impact of the DOL Fiduciary Rule on Independent Insurance Agents
Drinker Biddle
June 23, 2017
"[S]uggesting that an investor take money out of his IRA to purchase a life insurance policy would be fiduciary advice.... [The prudence requirement] does not require agents to guarantee a future outcome. But it does require agents to go through a thorough and well-documented series of steps.... The 'impartial conduct standards' require that the agent act in the best interest of the client and not make misleading statements in any information provided to the client."
Oregon Retirement Savings Program Amends Enrollment Language
National Tax-Deferred Savings Association [NTSA]
June 23, 2017
"The temporary rule inserts language to clarify that if an employee has not established an IRA after being notified and having been given an opportunity to opt out of the program, an IRA will be established for that employee under directives and procedures the ORSP Board establishes."
A Close Look at New York's New Paid Family Leave Law
Davis Wright Tremaine LLP
[Guidance Overview]
June 23, 2017
"Which employers are covered? ... Which employees are eligible for PFL? ... What can PFL be used for? ... How are payroll deductions calculated? ... Are employees required to provide notice before taking PFL?.... Can PFL benefits be coordinated with other leave laws? ... Can PFL benefits be coordinated with an employers' existing policies? ... Does PFL leave require the employer to hold the employee's job? ... What should employers in NY do now? ... What must employers do once the NYPFL Law takes effect?"
Chicago and Cook County Paid Sick Leave Ordinances Revised (PDF)
Ford & Harrison LLP
[Guidance Overview]
June 23, 2017
"Chicago's draft rules provide that if an employer's benefit year begins after an employee's start date, the employer shall allow the employee to carry over all of the accrued paid sick leave, up to 20 hours, to the benefit year. Cook County's rules provide two possible ways to move an employee to a different accrual period than based on an anniversary.... Employers in both jurisdictions who already provide time off for employees may not have to provide separate PSL in certain circumstances."
Voya's Win in 401(k) Fee Suit Involving Financial Engines Bodes Well for Other Record Keepers
Pensions & Investments
June 23, 2017
" 'The court here has said that an entity can be a fiduciary for some purposes and not others, and with respect to this fee issue, Voya was not a fiduciary,' [attorney John Utz] said. 'It was not a fiduciary because it wasn't acting as a fiduciary in negotiating fees, and ... once the arrangement was in place, there was not anything Voya could do to control its compensation.' Voya, for example, couldn't control the number of participants using the personalized advice services offered in the Nestle 401(k) plan." [Patrico v. Voya Financial, Inc., No. 16-7070 (S.D.N.Y. June 20, 2017 ]
Removing the Legal Impediments to Offering Lifetime Annuities in Retirement Plans
TIAA Institute
June 23, 2017
"Longevity risk ... is the greatest risk facing retirees in the U.S. today. Government policies could require plan sponsors to include lifetime income products in their investment options or provide tax incentives that encourage their use. To broaden the range of permissible lifetime income products, the federal government could allow low-cost products that pool risk among participants."
Putting the Pension Back in 401(k) Plans
TIAA Institute
June 23, 2017
"[Lifetime Income Annuities (LIAs)] are most beneficial to plan participants who optimally commit 8% to 15% of their plan balances at age 65 to an LIA that starts payments at age 85. Plan sponsors can integrate LIAs as defaults in their plans by converting as little as 10% to 15% of retiree plan assets."
Fourth Circuit Finds City, Not Staffing Agency, to Be Employer for FMLA Purposes
The Wagner Law Group
June 23, 2017
"The court commented that the employee's allegations showed that the city exercised significant control over her employment and, as such, that it could be her primary employer.... The court also noted that, even if the city were found to be the employee's secondary employer, it could still be liable for FMLA violations." [Quintana v. City of Alexandria, No. 16-1630 (4th Cir., June 6, 2017)]
ERISA Plan Choice-of-Law Provisions: Disability Claim Reviewed Under Abuse of Discretion Standard of Review
Lane Powell PC
June 23, 2017
"The Court rejected Plaintiff's argument that de novo review should apply because Indiana law disfavors discretionary review.... Courts are not consistent on what effect choice-of-law provisions have on the standard of review. Many courts have determined, for example, that state law prohibitions of discretionary clauses fall within ERISA's savings clause and are not preempted by ERISA." [Kalnajs v. The Lilly Extended Disability Plan, No. 16-62 (W.D. Wis. June 14, 2017)]
Target Date Funds, Annuitization and Retirement
TIAA Institute
June 23, 2017
"Financial/portfolio risks and mortality risks are independent and separable, so holdings including annuities can capture both completely. The target-date funds framework without annuities does not allow someone with a limited bequest motive to insure idiosyncratic mortality risk. The study's results support the use of target-date fund products within annuitized vehicles."
Financial Communications and Asset Allocation Decisions
TIAA Institute
June 23, 2017
"Communication media and format have large effects on reading style, which can affect comprehension. Print encourages a more systematic, deeper reading style compared to an online format. Charts attract visual attention. Comprehension and individual differences (especially risk tolerance and financial self-confidence) have large effects on asset mix decisions."
Exclusive Agreement Between Hospital and Insurance Plan Does Not Violate Sherman Act
Sheppard Mullin
June 23, 2017
"Judge Posner, writing for a unanimous panel, held that the procompetitive benefits of the exclusive deal arguably outweighed the anticompetitive effects, finding the vertical exclusivity agreement to be economically efficient. An insurance company or plan can get better rates from a hospital in exchange for exclusive contracts, benefiting the plan and its customers. The court took considerable comfort in the short duration of the agreement as well." [Methodist Health Serv. Corp. v. OSF Healthcare System d/b/a Saint Francis Medical Center, No. 16-3791 (7th Cir. June 9, 2017)]
Senate Republicans Release Bill to 'Repeal and Replace' ACA
Littler
June 23, 2017
"The Senate bill would effectively eliminate the employer mandate on a retroactive basis, effective January 1, 2016, by reducing to zero the penalties for failing to offer such health coverage. The Senate draft bill, like its House counterpart, includes provisions to promote the use of health savings accounts."
Ninth Circuit: ERISA Does Not Preempt California Law Voiding Discretionary Clauses
Thomson Reuters / EBIA
June 23, 2017
"The court's conclusion that the law reaches discretionary clauses in plan documents -- not just insurance contracts -- might seem problematic for self-insured plans. But because this case involved an insured plan, the court did not discuss the 'deemer' clause of ERISA's preemption provision, under which an ERISA plan cannot be deemed to be an insurer for purposes of state insurance laws. Accordingly, the law's applicability to self-insured plans remains an open issue." [Orzechowski v. The Boeing Co. Non-Union Long-Term Disability Plan, No. 14-55919 (9th Cir. May 11, 2017)]
Senate Republicans Offer Bill to Preserve and Expand Obamacare
Cato Institute
[Opinion]
June 23, 2017
"The Senate bill would preserve ObamaCare's community-rating price controls.... The Senate bill, like ObamaCare, would simply throw taxpayer dollars at unaffordable care, rather than make health care more affordable.... [T]he Senate bill would forbid the 19 states that haven't implemented ObamaCare's Medicaid expansion from doing so.... The bill would also repeal the Medicaid expansion in 2024.... the forthcoming CBO score will make it look like the Senate bill increases the uninsured more than it actually does.... [T]he bill does almost nothing to address the fundamental flaws and instability in ObamaCare's architecture."
Millennials Make Greatest Gains in 401(k) Plan Participation
Wells Fargo
June 23, 2017
"Millennials have demonstrated the biggest gains in the percentage of those participating in their 401(k) plans over the last five years, with an increase of 13.3%. They're also the most-diversified generation, with 83% meeting Wells Fargo's minimum diversification goal.... In addition, 30% of millennials contribute enough to maximize their full employer match when one is offered."
How Do Distributions from Retirement Accounts Respond to Early Withdrawal Penalties?
TIAA Institute
June 23, 2017
"Crossing the age 59-1/2 threshold leads to a $1,600 increase in annual distributions from IRAs. People with birthdays that result in fewer months of penalty-free withdrawal in the calendar year in which they turn 59-1/2 have a much smaller increase in annual distributions between the years in which they turn 58-1/2 and 59-1/2. In contrast, those who turn 59-1/2 early in the calendar year see much sharper increases."
Senate Health Care Bill Will Reduce Costs for Employers and Employees
The ERISA Industry Committee [ERIC]
[Opinion]
June 23, 2017
"Most importantly, the Senate's health care bill lays out a path to fully repeal the 40 percent 'Cadillac' excise tax on employer-sponsored health insurance. The 'Cadillac' tax ... forces employers to scale back benefits and increasingly shift rising health care costs to employees. Full and final repeal of the Cadillac tax is essential to ensuring a healthy future for the employer-sponsored health insurance system."

<< Older News   |  June 26, 2017


RSS feed for BenefitsLink.com RSS feed for BenefitsLink.com Daily Newsletters

 
Webmaster:
© BenefitsLink.com, Inc.
Privacy Policy