Retirement Plans Edition
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October 4 - 5, 2000
Tax Breaks Help Retirement Savings
Excerpt: "Setting up any kind of retirement savings account is better than having no retirement account. But some retirement accounts are better than others. The key is maximizing tax benefits while accumulating your savings. That's important because it will help your personal nest egg grow faster, giving you more money to supplement your pension and Social Security checks after you stop working." (Associated Press)
Summary of ERIC Initiatives and Other Key Provisions In H.R.1102
(ERISA Industry Committee)
Pick-Up Plans
A new outline at Carol V. Calhoun's employee benefits sitediscusses legal issues surrounding "pick-ups" (within the meaning of Code section 414(h)(2)) in governmental retirement plans. (Calhoun Law Group, P.C.)
PBGC Publishes Pension Insurance Data Book 1999
Excerpt: "The Pension Insurance Data Book 1999 (PDF format) provides detailed statistics on the pension insurance programs of the Pension Benefit Guaranty Corporation (PBGC). An article analyzing the statutory limits of PBGC's guarantee and their effect on the benefits PBGC pays to participants in PBGC-trusteed plans precedes the data tables." (Pension Benefit Guaranty Corporation)
Raytheon Gets Preview Dispute With Towers Perrin Over Calculation of Excess Assets in DB Plan
(Reuters via Yahoo! Finance)
PBGC Issues Guidance on Business Transactions Early Warning Program
(Deloitte & Touche)
IRS Issues Revenue Procedure 2000-41 on Changes in Funding Methods for DB Plans (PDF)
Excerpt: "The purpose of this revenue procedure is to set forth the procedure by which a plan administrator or plan sponsor may obtain approval of the Secretary of the Treasury for a change in funding method as provided by section 412(c)(5)(A) of the Internal Revenue Code ... [an earlier procedure, Rev. Proc. 2000-40,] provides approval to change the funding method used to determine the minimum funding requirement for defined benefit plans to any one of the methods described therein." (Internal Revenue Service)
Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
What is the maximum amout in retirement benefits that a rail worker can receive with 40 years of service? She retired in 1985 and is now 80 years old. (BenefitsLink.com)
Another Question is Answered in the Who's the Employer Q&A Column
What is the current legal status of PEOs and other leasing organizations being regarded as a "co-employer" with their clients for retirement plan purposes? (BenefitsLink.com)
Scudder Chooses Pyramid Digital Solutions
Excerpt: "Scudder Retirement Services is integrating Pyramid Digital Solutions client servicing suite into its retirement plans business. Scudder administers more than $14 billion in 401(k) plan assets." (401kWire.com)
Standard & Poor's Retirement Services Aligns with Investlink Technologies
Excerpt: "Standard & Poor's, a division of The McGraw-Hill Companies, today announced an agreement with InvestLink Technologies, a wholly-owned subsidiary of Federated Investors, Inc. (NYSE: FII), that will enable defined contribution plan administrators to combine advice capabilities with the software/e-commerce system software that InvestLink provides to more than 60 defined contribution third party administrators (TPAs) representing approximately 15,000 plans with over 800,000 participants." (PR Newswire)
ABC, ERIC, Others Say: Don't Add More Cash Balance Provisions To Pension Bill on Senate Floor
Excerpt: "[Certain provisions already in the committee-approved version of the bill] ensure that employees are fully informed of changes to the pension plans in which they participate-- including changes to early retirement features in the plan-- and prohibit 'wear-away' of normal retirement benefits if a traditional defined benefit pension plan is converted to a cash balance or other hybrid defined benefit design." (American Benefits Council)
DROP/Phased Retirement Arrangements, 457 Matches, and Other Current Trends in Governmental Plans
Another new outline is available at Carol V. Calhoun's employee benefits site discusses deferred retirement option plans ("DROPs") and employer matches of 457 plan contributions. (Calhoun Law Group, P.C.)
Analysis: IRAs That Invest in Family Limited Partnerships
Excerpt: "Can an IRA form or invest in a partnership (or other entity) in which the IRA and other disqualified persons have less than a 50% interest in capital or profits without violating the prohibited transaction rules? Probably, but great caution is called for." (Noel C. Ice, Esq. of Cantey & Hanger LLP)
Rule 701 - Its Parameters and Nuances
Excerpt: "Subject to certain exemptions, Section 5 of the Securities Act of 1933 requires that all sales of securities be registered with the Securities and Exchange Commission. Rule 701, which was adopted in 1988, provides a safe harbor exemption from these registration requirements for compensatory arrangements maintained by privately held employers, provided that certain conditions are met. Rule 701 was revised ... to remove the $5,000,000 ceiling on the exemption, effective April 7, 1999." (Kirk Maldonado, Esq. of Riordan & McKenzie)
PBGC Pension Search Program Finds 6,600 People Who Were Owed $21 Million; $27 Million Still Left
(Pension Benefit Guaranty Corporation)
Two Legs Are Better Than Three: New Zealand As A Model For Old Age Pensions
Excerpt: "In contrast to conventional social insurance, the New Zealand retirement income system comprises a basic individual taxable flat-rate public pension supplemented by purely voluntary saving. The New Zealand system has proved remarkably durable, acceptable, and fiscally responsible.... Its primary success lies in ensuring a stable and adequate retirement income for all citizens, moderating income inequality in retirement and protecting all older citizens from uncertainty ..." (Susan St. John and Larry Willmore, published by Centre for Pensions and Social Insurance)
Is the National Retirement Debate a Good Thing?
Excerpt: "Retirement issues have taken a more front and center place in the current presidential election as both candidates have put forward their own solutions to this issue. Yet, plan sponsors believe that this may not be a good thing." (401kWire.com)
Stock Options Shouldn't Faze Planners
Excerpt: "Most agents and financial planners today are encountering numerous clients and prospects with significant numbers of options. These options provide tremendous opportunities for the financial adviser today in terms of planning fees and increased sales. Stock options can also be the catalyst for providing a much-appreciated value-added service in an area few understand well." (OptionWealth.com)
(Following also appears in Welfare Plans Edition)
EEOC Publishes Compliance Manual on Employee Benefit Plans
Excerpt: "The section provides guidance and instructions for investigating and analyzing issues [under ADEA, the ADA, Title VII of the Civil Rights Act of 1964 or the Equal Pay Act] ... with regard to life and health insurance benefits, long-term and short-term disability benefits, severance benefits, pension or other retirement benefits, and early retirement incentives.... [A]ll employee benefits must be provided in a non-discriminatory manner unless a statutory exception provides otherwise." (Equal Employment Opportunity Commission)
Court-Approved Plan Language Seeks To Guarantee Safe Harbor for Sponsor Discretion
Excerpt: "[T]he U.S. Court of Appeals for the Seventh Circuit laid down safe harbor language for SPD deferential standard of review [in] Herzberger v. Standard Insurance Co.... The issue was whether language in plan documents to the effect that benefits shall be paid when the plan administrator upon proof (or satisfactory proof) determines that the applicant is entitled to them confers upon the administrator a power of discretionary judgment..." (Corbel)
Chart of Currently Pending Employee Benefits Issues in Washington
Describes issues, bill numbers, and status. Nice! (Deloitte & Touche)
| Implementation Specialist | for Towers Perrin - Benefit Administration Services in NJ, PA |
| 401(k) Consultant | for Louis Kravitz & Associates, Inc. in CA |
| Senior Compliance Specialist | for Putnam Investments in MA |
| Employee Benefits Tax Manager/Senior Manager | for Deloitte & Touche, Leading Professional Services Firm in MN |
| Trust Administrator | for Fifth Third Bank, Kentucky, Inc. in KY |
| CONVERSION SPECIALIST | for TEAMVEST - CHARLOTTE in NC |
| Senior Benefit Plan Analyst | for Marriott International, Inc. in MD |
| Part Time Defined Contribution Administrators | for Ceridian Retirement Plan Services in CO |
| Retirement Administrator | for Delaware Investments in PA |
| Daily Valuation Administrator | for WESPAC Plan Services, Inc. in CA |
| Senior Paralegal- Retirement Consultant | for William M. Mercer in NY |
| Defined Benefit Conversion Programming Specialist | for New York Life Benefit Services LLC in MA |
| Defined Benefit Conversion Specialist | for New York Life Benefit Services LLC in MA |
| Director of TSA Sales | for Security Benefit Group of Companies - Topeka, KS in KS |
| Compliance Administrator | for The Vanguard Group in PA |
| Operations Manager | for Summit Bank in NJ |
| HR Generalist | for Hewitt Associates in IL |
| Pension Plan Administrator | for Thomas F. Barrett, Inc. in MD |
| Defined Contribution Account Administrator | for The Vanguard Group in PA |
| ERISA Attorney | for Watson Wyatt Worldwide in OH |
| Trust Account Manager (Employee Benefits) | for The Northern Trust Company in IL |
| Nonqualified Plan Account Manager | for Benefit Plan Services, Inc. in GA |
| Regional Account Representative | for Insurance Company Providing 401(k) and Other Retirement Plans in TX |
| Assistant Benefit Consultant | for Buck Consultants, Inc. in NJ |
| Legal Assistant II - ERISA | for American Century Investments in MO |
| ERISA - Benefits Attorney | for William M. Mercer in NY |
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