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Retirement Plans Edition


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September 21, 2000

Another Question is Answered in the Distributions: Taxation and Planning Q&A Column
My husband has been employed for 11 years with ABC Corp. -- we have prequalified for a new home, and we took for granted that we would have no problems taking money from his 401(k) plan. Unfortunately, the plan administrator has denied our withdrawal request. I thought 401(k) hardships included down payments for a principal residence. Is it legal for the plan to deny our request for a hardship withdrawal? (BenefitsLink.com)

Opinion: Good Retirement Plans Can Lure Teachers
Excerpt: "Here's a radical thought: Do you suppose an enterprising school district could attract and keep teachers by offering a slick package of retirement savings options while cleaning up sales excesses?" (Fort Worth Star-Telegram)

3d Cir.: Job Separation Benefits Were Protected From Elimination By ERISA Sec. 204(g)
Excerpt: "A permanent job separation benefit provided under a pension plan constituted both an early retirement benefit and a retirement-type subsidy protected by ERISA Sec. 204(g) and therefore a plan amendment that eliminated the benefit violated ERISA. This was the decision of the Third Circuit U.S. Court of Appeals in Bellas v. CBS, Inc. and Westinghouse Pension Plan..." (Spencernet)

5th Cir.: Sponsor Might Have Breached Its Fiduciary Duties in Selecting Executive Life Annuity
Excerpt: "The Fifth Circuit U.S. Court of Appeals has ruled that a federal district court improperly granted summary judgment in favor of a company in a lawsuit alleging that the firm breached its fiduciary duties under ERISA in selecting an annuity issued by failed Executive Life Insurance Company. The case is Bussian, et al. v. RJR Nabisco, Inc." (Spencernet)

Another Question is Answered in the Distributions: Taxation and Planning Q&A Column
If there is a deemed distribution under Section 72(p) of the Code and no offset is taken, what happens to the outstanding loan, and what effect does this have on subsequent loans? (BenefitsLink.com)

Revised Form 5500 and 404(c) Compliance
Excerpt: "The new Form 5500 requires that the preparer know whether a participant-directed plan intends to comply with ERISA section 404(c). The inquiry regarding 404(c) compliance raises material, substantive issues. Since the initial wave of filings on the new 5500 Form are due on October 16 (for calendar 1999 plan years), the issue of intent with respect to 404(c) compliance requires prompt attention." (Reish & Luftman)

Boost Your IRA Returns by Rebalancing
(IRAjunction.com)

GAO Questions Contract Award by PBGC
Excerpt: "Congressional investigators say a federal agency that guarantees pensions when employers go bankrupt awarded $40 million in contracts to a friend of one of its executives. But Pension Benefit Guaranty Corp.'s executive director says the agency has investigated and cannot substantiate the allegations." (New York Times; free registration required)

PBGC Official Faces Scrutiny for Award of Contract
Excerpt: "[Bennie L. Hagans Jr.] improperly steered $40 million worth of contracts to a minority-owned company, Congressional investigators are set to testify this morning before a joint meeting of two Senate committees.... For more than a year, [PBGC Executive Director David] Strauss has been saying privately, often with great anger, that he believes Mr. Hagans and [the party to whom the contract was awarded] are the victims of racism." (New York Times; free registration required)

AARP Survey Results: Individual Accounts, Social Security, and the 2000 Election
Excerpt: "Most of those polled expect Social Security to be a key factor in determining which presidential candidate they will choose. But, while generally supporting the idea of changing the system by establishing private accounts, their support quickly fades when they consider the possible consequences of specific plans. (53 pages)" (American Association of Retired Persons)

Commentary: Aging's Global Impact
Excerpt: "Although each [candidate's Social Security reform] plan has merit, neither comes to grips the with fact that global economic growth, an essential ingredient in both plans, may falter as Europe's economies follow Japan into lengthy and disruptive aging recessions." (Washington Times)

(Following also appears in Welfare Plans Edition)

Testimony on the Global Aging Crisis
Hearing held September 21, 2000. On the panel: Ben J.Wattenberg, Senior Fellow, American Enterprise Institute; Peter R.Orszag, Ph.D., President, Sebago Associates, Belmont, CA; Paul S. Hewitt, Project Director, Global Aging Initiative, Center for Strategic and International Studies; David Hale, Ph.D., Global Chief Economist, Zurich Insurance Group, Chicago, IL; and Vincent J. Truglia, Managing Director and Co-Head, Sovereign Risk Unit, Moody's Investors Services, New York, NY. (House Ways and Means Committee, Subcommittee on Social Security)



Job Openings Newly Posted or Reposted on EmployeeBenefitsJobs.com


Retirement Sales District Managerfor ADP, Inc., A Leader in the Defined Contribution Market
in CA, NY
Director of Business Developmentfor ADP,Inc., A Leader in the Defined Contribution MarketPlace
in NJ
Account Manager / Group Benefits Departmentfor Employee Benefits Consulting Firm
in FL
Employee Benefits Plan Specialistfor King & Spalding
in GA
401(k) Recordkeeper/Employee Benefits Analystfor TeamVest, Inc.
in NC
Retirement Plan Administratorfor Alliance Benefit Group
in MN
Daily Valuation Administratorfor RM White & Associates
in CO
Benefits Administration Team Leadfor KAISER PERMANENTE
in CA

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