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The BenefitsLink Newsletter -
Retirement Plans Edition
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April 10, 2002 - 11,782 subscribers
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Critics Charge Pension Bill Favors Highly Paid Workers
Excerpt: "[S]ome legal experts and pension rights advocates say the first of the post-Enron pension measures to reach the House floor actually opens up fresh loopholes. Some of the bill's provisions would lead companies to seek to reduce the number of employees covered by pensions and give proportionately larger pension benefits to the most highly paid executives, they say." (New York Times; free registration required)

Now Online: April 2002 Issue of IRS' Employee Plans News (PDF)
Excerpt: "[The IRS has revised some of its] determination letter application forms. These revised application forms no longer contain a duplicate front page (or pink copy). Therefore, the applications may be submitted as downloaded from the Service's Web Site." (Internal Revenue Service)

Severance From Employment: the Same Desk Rule's Evil Twin?
Excerpt: "Everyone's leaping for joy over the announced repeal of the same desk rule by the Economic Growth And Tax Relief Reconciliation Act of 2001 (EGTRRA).... But, even if it has been replaced by the severance from employment standard, are we any better off? As you will see from this article, this concept is just as thorny." (Chang, Ruthenberg & Long PC)

Catch up on How New 401(k) Catch-up Limits Work
Excerpt: "If your employer decides to only match regular 401(k) contributions and not catch-up contributions, you have to be careful not to miss out on the match for December contributions. That could happen if the following conditions exist: ..." (mPower Cafe)

PBGC Releases Annual Report
Press release. Excerpt: "In its Annual Report released today, the Pension Benefit Guaranty Corporation (PBGC) reports a surplus of $7.7 billion for the year ended Sept. 30, 2001, in its insurance program for single-employer defined benefit pension plans. This program protects the pensions of about 35 million people." (Pension Benefit Guaranty Corporation)

Another Question is Answered in the Who's the Employer Q&A Column
Recently, the BenefitsLink newsletter has highlighted conflicting articles by the Center for a Changing Workforce and the National Association of Professional Employer Organizations. What's your take on the situation? (BenefitsLink.com)

Debtor's Interest In Former Spouse's Retirement Benefits Was Exempt In Bankruptcy
A debtor's undistributed interest in his former spouse's qualified retirement plan that the debtor obtained pursuant to a qualified domestic relations order (QDRO) was exempt in the debtor's bankruptcy proceedings. This was the decision of the Eighth Circuit U.S. Court of Appeals in In re Nelson (No. 01-6072MN). (Spencernet)

Analysis: the New Fidelity Bond Requirements for Small Plans
Excerpt: "The new final regulations, issued by the DOL late in 2000, add new hurdles for plan sponsors of small plans seeking to avoid the [independent qualified public accountant] and audit requirements. The new rules applicable to the 'small plan audit' exception are 'effective for plan years beginning after April 17, 2001.'" (Chang, Ruthenberg & Long PC)

New GAO Report: Private Pensions-- Improving Worker Coverage and Benefits
51 pages; April 2002. Excerpt: "Traditional reforms to the voluntary, single-employer-based pension system may have limited potential to significantly expand pension coverage and improve benefits for workers who traditionally lack pensions.... Outside the voluntary, single-employer private pension system, there are three broad categories of reform approaches-- pooled employer reforms, universal access reforms, and universal participation reforms." (U.S. General Accounting Office)

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

SEC Chairman Stays Neutral on Stock Options Accounting Issue
Excerpt: "Corporate America should not be forced to treat stock options as expenses on income statements until other ways are tried to make the executive perk less prone to abuse, the top U.S. securities regulator said Tuesday.... [Harvey] Pitt said stock options need to be better explained to shareholders and structured to align the interests of managers and investors." (CNN Money)

Bush Weighs In on Debate Over Stock-Option Rules
Excerpt: "Mr. Bush took issue with a proposal supported by Alan Greenspan, chairman of the Federal Reserve, that would force companies to record such options as expenses, like other forms of compensation." (New York Times; free registration required)

Overview: DOL Reduces Delinquent Filer Penalties (PDF)
Excerpt: "The DFVC Program is only available to a plan administrator who has not received a written notice from the DOL of a failure to file a timely annual report. In addition, certain filings not required under Title I of ERISA (such as Form 5500-EZ) are not eligible for the DFVC Program." (Milliman USA)

Treasury Department, IRS Seek Comments On Items For Next Guidance Priority List
In Notice 2002-22, I.R.B. 2002-14, the Treasury Department and the Internal Revenue Service request public comments concerning items that should be included in the agencies' Guidance Priority List for 2002-2003. Each year, the Treasury Department and the IRS use the priority list to identify and prioritize the tax issues that should be addressed through regulations, rulings, and other published administrative guidance. (Spencernet)

Overview: Claims Procedures For Pension Plans Providing Disability Benefits (PDF)
March-April 2002 issue; begins on page 7. (Jenkens & Gilchrist)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Trust Administrator for CNA Trust
in CA
Sr. Benefits Specialist for Apple Computer, Inc.
in CA
401(k) and Pension Marketing/Consultant for Leggette Actuaries, Inc.
in TX
Senior Compliance Analyst for CitiStreet (a State Street and Citigroup Company)
in MA

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Copyright 2002 BenefitsLink.com, Inc., but you may freely distribute this email newsletter in whole. This newsletter is edited by David Rhett Baker, J.D.