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The BenefitsLink Newsletter -
Retirement Plans Edition
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May 8, 2001
Today's sponsor: Employee Benefits Webcast (click)


   Webcast coming up May 30!  FMLA: The Family and Medical
Leave Act -- "It's Not Getting Any Easier."   Instructor: Christine E. Howard, Esq. and Jennifer B. Sandberg,
Esq., Fisher & Phillips LLP.  Presented by Human
Resource Consultants.   Click to register and purchase this webcast through BenefitsLink!

How Retirement Plan Changes Hit You
Excerpt: "But this year, despite any posturing that will go on in the Senate, I think the House provisions will pass the Congress largely intact. Further, I think the president will sign that legislation when at long last it gets to the White House. If I'm correct (and I sincerely hope I am), here's what I think we can expect to happen:" (Motley Fool via MSNBC.com)

Rethinking Retirement
Excerpt: "Congress recently repealed a Depression-era provision that caused workers to lose some or all of their Social Security benefits if they earned more than $17,000 a year. A 1998 survey by AARP found that 80 percent of boomers believe they will work at least part-time during their 'retirement' years. Why won't retirees quit? Will this trend last in an economic downturn? Marc Silver, assistant managing editor at U.S. News & World Report, joined us today in a live chat ..." (ABCNews.com)

Survey Finds "Near Zero" Investment Growth For 401(k) Plans In 2000
According to a survey recently released by the National Defined Contribution Council (NDCC), the combined investment growth for the nation's Sec. 401(k) plans was nearly unchanged in 2000 compared to 1999, with most of the increase in plan assets due to participant contributions and employer matching contributions. The NDCC noted that the investment results were due primarily to last year's downturn in the stock market. (SpencerNet)

Another Question is Answered in the Who's the Employer Q&A Column
Able and Baker own 50% of three corporations. The first is a C corporation which has as its sole source of income the payment of management fees from the other two corporations (which are both S corporations). The two shareholders receive directors fees from the C corporation and they are officers of that corporation. Can they establish "SIMPLE" plans individually using this self-employment income without covering any other employees? (BenefitsLink.com)

In Pennsylvania, Pension Raises for Teachers, Legislators
Excerpt: "[Pennyslvania Governor] Ridge last night won legislative approval of his education package ... in exchange for raising pensions for legislators, state workers, and 234,000 teachers and other public-school employees originally excluded from the pension increases." (The [Philadelphia] Inquirer)

Did Florida State Pension Reform Tiff Spill Over Into Bill?
Excerpt: "As Florida officials worked to overhaul the state retirement system, House Majority Leader Mike Fasano butted heads more than once with Tom Herndon, the chief state official overseeing the pension reform. Fasano, R-New Port Richey, complained that Herndon ignored recommendations of advisers, including himself." (St. Petersburg Times)

Mutual Funds Trade Association Testifies on Tax Code Simplification Study
Excerpt: "The Institute has submitted a written statement to the Senate Finance Committee on its recent hearing on the Joint Committee on Taxation's study on the overall state of the federal tax system. The study includes various recommendations regarding simplifications to retirement and education savings tax incentives, including IRAs, 403(b) arrangements, 457 plans, and the HOPE and Lifetime Learning credits." (Investment Company Institute)

Opinion: Bush's Plan Not Only Path to Social Security Reform
Excerpt: "Even veterans of the Clinton health care crackup agree that it makes sense for Bush to begin by advancing his ideal reform plan. The question is whether he'll later bend to political reality, which the Clintonites wouldn't do until it was too late. It's not clear whether Bush could muster 51 Senate votes for his plan--but even if he could, many in the GOP think it would be suicide to restructure Social Security with only Republican fingerprints." (Los Angeles Times)

(Following items also appear in Welfare Plans Edition)


Comments on Notice 2001-14 Regarding Employment Taxes on Income from Statutory Stock Options
May 2, 2001. Excerpt: "We strongly recommend that ESPPs and ISOs permanently be exempt from employment taxes and federal income tax withholding. In each case, there are compelling reasons for making the guidance in Notice 2001-14 for pre-2003 exercises permanent." (National Association of Stock Plan Professionals)

Salvaged from the Depths: Employers Rescuing Underwater Options
Excerpt: "The iQuantic study showed that almost half of the 80 percent of companies that reported underwater options have already responded in some way and that 25 percent are considering action.... None of this is escaping the notice of the SEC, however. The agency is pushing hard to change some of the rules regarding stock options ..." (eWeek.com)




Newly Posted or Renewed Job Openings (Post Yours!)
Managing Director-Executive Benefits-Dallas for Clark Bardes/ Compensation Resource Group
in TX
401(k) enroller/education/communications specialist for a national financial services institutions
in CA, GA, TX
Senior Compensation and Benefit Analyst for Barnes Group Inc.
in CT
Pension Analyst for Del Monte
in CA
Pension Consultant for Dreyfus
in NY
ERISA Trust Attorney for Northern Trust
in IL

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