| The BenefitsLink Newsletter - Retirement Plans Edition |  |
March 14, 2001
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Letter to Clients on 401(k) Safe Harbor Retirement Plan Options
Excerpt: "Two Alternative Employer Contribution Options: The 'cost' of this automatic compliance with the ADP and ACP tests is the employer must provide a minimum contribution which is either a (1) 100% vested, nonelective employer contribution of 3% of pay for all participants, including the highly paid, or (2) a 100% vested employer matching contribution, but not both." (Alson R. Martin, Esq. of Shook, Hardy & Bacon L.L.P., published by Small Business Council of America)
Los Angeles Sheriff Sues to Delay Pension of $142,000
Excerpt: "The county's highest-paid elected official doesn't want a penny more for now, thank you. So, Sheriff Lee Baca is suing Los Angeles County to avoid being paid about $142,000 a year in retirement benefits on top of his $207,000 annual salary." (Los Angeles Times)
Considering a Roth IRA Conversion In the Face of Possible Tax Cuts
Excerpt: "Though the amounts, effective dates and the shape of future tax cuts are uncertain, it is likely that we will enjoy tax reductions in either 2001 and/or 2002 and beyond. It is also fairly safe to say that we don't know what the stock market is going to do. These uncertainties have broad implications for Roth IRA conversion strategies. IRA owners should be prepared to respond." (James Lange, CPA, Esq., published by Roth IRA Advisor)
PSCA Applauds Portman-Cardin Retirement Bill
Excerpt: "The Profit Sharing/401(k) Council of America (PSCA) commends Representatives Rob Portman (R-Ohio) and Ben Cardin (D-Maryland) for reintroduction of their comprehensive reform and updating of the regulation of private pensions." (Profit Sharing/401(k) Council of America)
House GOP Expanding on Tax-Cut Plan
Excerpt: "House Republicans want to augment President Bush's $1.6 trillion tax cut by reducing capital gains taxes for investors, raising incentives for people to save for retirement and letting businesses recoup computer expenses more quickly." (Salt Lake Tribune)
ASPA Strongly Supports Portman-Cardin Pension Legislation
Excerpt: "This comprehensive legislation recognizes the important role played by the private pension system in providing retirement savings for Americans. By simplifying the complicated tax laws governing retirement plans, this legislation is a significant step in the right direction that will encourage retirement plan formation and expansion. Current law and the thousands of pages of accompanying regulations have gone too far." (American Society of Pension Actuaries)
Comprehensive Retirement Security and Pension Reform Act to be introduced on March 14, 2000
Excerpt: "A media briefing to announce the introduction of the Comprehensive Retirement Security and Pension Reform Act (H.R. 1102 in the 106th Congress). The bill raises contribution limits on IRAs and employer-sponsored retirement plans; modernizes portability and vesting rules; reforms and simplifies current law to encourage small business to offer plans to their workers." (American Benefits Council)
Agencies May Be Asking, 'What Constitutes Informed Choice by a Participant?'
Excerpt: "Expect to see additional Department of Labor and IRS scrutiny on what you communicate on benefit options to your retirees and terminated participants. You will likely be asked to provide more information on the relative value of each payment option available for payment." (Gregory E. Matthews, CPA, published by Small Business Council of America)
A Note On Using An Experimental CPI-E For Older Americans
Research paper by Satyendra Verma, Ph.D. Excerpt: "In addition to these two CPIs, the 1987 amendments to the older Americans Act (1965) directed the BLS to develop an experimental index (CPI-E) for Americans 62 years of age and older. This index initially measured price changes during 1987 to 1993, and has been extended through 2000." (American Association of Retired Persons)
Concurrent Changes In The CPI As a Measure of Inflation
Research paper by Satyendra Verma, Ph.D. Excerpt: "The Consumer Price Index (CPI), which is administered and constructed by the Bureau of Labor Statistics (BLS), is the main source of information on consumer prices and inflation in the United States. The CPI influences both public and private sectors' policy decisions as well as the finances of the federal, state, and local governments." (American Association of Retired Persons)
Another Question is Answered in the Who's the Employer Q&A Column
A trucking company has only two employees. The truckers are treated as independent contractors and payment to them is reported on a Form 1099. Is it possible to set up a 401(k) plan covering the truckers, even though they're not paid via a Form W-2? (BenefitsLink.com)
Another Question is Answered in the Stop, Look & Listen: Railroad Retirement Q&A Column
I was born in 1953 and started working for a railroad in 1977. I will get have 30 years of service in 2007 and I will turn 60 in 2013. Can I retire on a full pension at age 62? If I take my pension at age 60, how much would it be reduced? (BenefitsLink.com)
Federal Court Orders Changes In Management of Ohio Teamsters Plans
Excerpt: "A federal court in Cleveland, Ohio has ordered the trustees of the pension and welfare plans of Teamsters Union Local 293 to repay $78,000 to the plans and to hire the Segal Company as an independent consultant to assess the plans' operations, according to a consent order and judgment obtained on March 8, 2001 by the U. S. Department of Labor." (U.S. Department of Labor press release)
Employment Tax Planning Ideas For U.S. Companies Issuing Stock Options To Employees In The U.K.
Excerpt: "Many U.S. companies issue stock options to their employees in the United Kingdom (U.K.) under the their existing U.S. stock option plan. In this case, those stock options will be considered 'unapproved' for U.K. tax purposes and will be subject to National Insurance Contribution (NIC) tax on all gains enjoyed by employees upon the exercise, assignment, or release of employee stock options." (Jill Hemphill, PricewaterhouseCoopers)
EITF Continues itsDeliberations on Issue No. 00-23
Excerpt: "The Emerging Issues Task Force (EITF) is in the midst of an extensive deliberation of over 30 practice issues and questions on the accounting for stock compensation under APB Opinion No. 25 and FASB Interpretation No. 44.... ). This letter briefly summarizes the conclusions reached at the January 17, 2001 meeting." (Frederic W. Cook & Co., Inc.)
Newly Posted or Renewed Job Openings (Post Yours!)
| Consulting - Pension Actuary & Administrators | for Louis Kravitz & Associates, Inc. in CA |
| Pension Administrator/Accountant | for First Mercantile Trust Company in TN |
| Managing Director-Executive Benefits-Dallas | for Clark Bardes/ Compensation Resource Group in TX |
| Client Service Manager | for ING-Aetna Financial Services in CT |
| 401k/DC Administrator (FT or PT) | for Sacramento Area TPA in CA |
| Senior Benefits Specialist | for Managment Resource Consulting in TN |
| Assistant Vice President International Benefits | for Countrywide in CA |
| Employee Benefits Sales Rep/Account Manager | for Edward L. Elkin, CLU , Orinda, CA in CA |
| Benefit Plan Account Manager | for WT Benefits, LLC in TX |
| PENSION OPERATIONS - TRUSTMARK | for MBM Advisors Inc. in TX |
| Retirement Plan Sales | for http://www.channelsynergy.com in NC, OH, TN |
| Defined Benefit Analyst | for Paragon Consulting Group in ALL STATES, VA |
| Benefit Administration Associate-Multiple Locations | for Towers Perrin in NJ, VA |
| Client Manager | for Benefit Services Corporation, a subsidiary of METLIFE in GA |
| Operations Manager | for Invesmart in TX |
| Benefit Project Specialist | for Aon Consulting, Inc. in MD |
| Sr. Project Specialist | for Aon Consulting, Inc. in MD |
| Defined Contribution Plan Administrator | for Aon Consulting, Inc. in MD |
| Client Manager | for Citizens Bank and Trust Co in IA, IL, IN, KS, MI, MO, NE, OH, WI |
| Health & Welfare Consultant | for Aon Consulting, Inc. in PA |
| Retirement Plans Account Administrator | for Invesmart - Portland, Maine in ME |
| Employee Benefits Tax Senior Manager | for Deloitte & Touche, a Professional Services Firm in TX |
| Defined Benefit Manager | for JELD-WEN in OR |
| Analyst | for Paragon Consulting Group in CO |
| Health Management Project Manager - EC-010215-003 | for Hewitt Associates in GA |
| 401 (k) Enroller/Contractor | for Transamerica in ALL STATES, CA, FL, GA, HI, IL, TX |
| 401 (k) Enroller/Contractor - Bilingual | for Transamerica in ALL STATES, CA, FL, GA, IL, TX |
| Testing & Reporting Specialist | for Zurich Scudder Investments in MA, NH |
Newly Posted Conferences (Post Yours!)
| What Every Benefits Manager Needs To Know About The Pharmacy Benefit | in CA on March 28, 2001 presented by The Los Angeles Chapter ISCEBS |
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