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The BenefitsLink Newsletter -
Retirement Plans Edition
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December 28, 2001 - 12,829 subscribers
Today's sponsor: Glasser LegalWorks

(Click on company name or banner to learn more.)

   You are invited to attend the nation's leading seminar on
   how recent cases affect claims, plan design and operations.

   Highlights of this year's program include:
   -Health Care Plan Litigation
   -Fiduciary Litigation
   -Preemption after Egelhoff
   -Aftermath of Pegram
   -Managed Care Litigation

   More details are available now in an online brochure:
   http://www.legalwks.com/conferences/erisa_lit/home.htm

(Help BenefitsLink to provide this newsletter at no charge to you -- our sponsors pay our way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)

Analysis: State Income Tax Laws May Complicate New EGTRRA Defined Contribution Plan Allocations
Excerpt: "If states do not conform their income tax laws to the federal Internal Revenue Code (IRC), the increased retirement savings that individuals can make under [EGTRRA] may be taxable under state law. In addition, employers would have state income tax withholding and reporting responsibilities." (The Segal Company)

Analysis: DOL Lowers Another Advice Barrier
Excerpt: "In Advisory Opinion 2001-09, the DoL found that an investment management firm could be compensated for offering investment advice on its own funds-- and could receive higher fees based on participant investment decisions on that advice-- subject to certain conditions. In so doing, the DOL appears to have set aside the standard previously outlined in the so-called Frost decision." (PLANSPONSOR.com; free registration required)

New Rules To Give 401(k) Holders Access To Advice
Excerpt: "Until now, interpretations of [ERISA] have prohibited investment companies who oversee employees' retirement accounts from doing any more than coming up with recommendations that investors could either follow or not. But the new rules, issued on Dec. 14 in a Labor Department advisory opinion, would allow mutual fund companies, brokerage firms and insurers to hire an independent financial adviser to offer investment advice and manage retirement account assets." (Reuters via Yahoo! Finance)

Opinion: Commission's Report is No Help on Social Security
Excerpt: "If anything, they reinforce the reasons that Mr. Bush's approach on Social Security is dubious. All three options would require drastic benefit cutbacks and large infusions of money from outside the system to keep it solvent. Instead of building a consensus for reform, the commission's recommendations make it even less likely that Congress will act on Social Security any time soon." (New York Times; free registration required)

Another Question is Answered in the Who's the Employer Q&A Column
Under IRC section 414(n)(4)(B), who is 'a person who is an employee of the recipient (whether by reason of this subsection or otherwise)'? I read this section to apply primarily to someone who has met the 'leased employee' definition. How else does one become an 'employee of the recipient?' If my reading is correct, doesn't the remainder of the section merely say that any service completed before (not just after) the person met the leased employee criteria is counted? (BenefitsLink.com)

Simplified Pension Calculator - Actuary Posts Excel Spreadsheet Online
Excerpt: "This calculator can give you a rough idea of what your pension income may be when you retire.... Using an Excel spreadsheet, it projects retirement income from an account balance based on employer and employee contributions. The simplified pension calculator was prepared by James Turpin, the Academy's vice president for pension issues, to help congressional staff estimate retirement income from the federal Thrift Savings Plan. But it can apply to other pension plans, too." (James Turpin of the American Academy of Actuaries)

(Following items are in both editions of the BenefitsLink Newsletter)


U.S. Sues Allstate, Whose Agents Cite Age Discrimination
Excerpt: "The suit, filed in United States District Court in Philadelphia without a formal announcement, centers on a decision by Allstate to convert its 15,200-member sales force from regular employees with pensions and health care benefits to independent contractors.... By last June, all but 6,400 of the agents had become contractors. The remaining agents, 90 percent of whom were older than 40, were then dismissed ..." (New York Times via Yahoo!)

Ringing in the New Rules: Analysis of New Q&A Guidance on DOL's Claims Procedure Regulations (PDF)
Excerpt: "Among the topics covered are: the sometimes murky distinction between when a question from an employee is a casual inquiry about benefits and when it is an actual claim for benefits; the specific rules governing second-level health and disability appeals for plans that use them; and the requirements to disclose internal guidelines and protocols used in denying health and disability claims." (Gardner, Carton & Douglas)




Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
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Newly Posted Press Releases
FACTS Services, Inc. Ensures A Clear and Easy Path To HIPAA Readiness - Well Ahead of Compliance Deadlines (FACTS Services, Inc.)

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Copyright 2001 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.