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The BenefitsLink Newsletter -
Retirement Plans Edition
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April 17, 2002 - 11,721 subscribers
Today's sponsor: Chang Ruthenberg & Long PC

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(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)

Final Required Minimum Distribution Regulations (PDF)
42 pages. Excerpt: "This document contains final and temporary regulations relating to required minimum distributions from qualified plans, individual retirement plans, deferred compensation plans under section 457, and section 403(b) annuity contracts, custodial accounts, and retirement income accounts.... These regulations are effective January 1, 2003." (Internal Revenue Service)

Text of IRS News Release Announcing Final Required Minimum Distribution Rules
Excerpt: "The latest guidance ... adds some new elements, including: advancing the deadline for determining a designated beneficiary from Dec. 31 to Sept. 30 of the year after a plan participant's year of death, making it easier to determine the initial distribution that must be made by the end of that year; clarifying rules related to separate accounts with different beneficiaries; [and] simplifying the calculation of required minimum distributions (RMDs) by eliminating certain variables." (Internal Revenue Service)

Overview: IRS Simplifies IRA Distribution Rules
Excerpt: "The new rules put in place yet another new set of tables that IRA owners may use to figure out the amount of each such withdrawal. These new tables generally will allow IRA owners to withdraw an even smaller amount each year than required under the old rules." (Neil Downing in the Providence [R.I.] Journal)

In Notice 2002-27, IRS Sets Forth New Reporting Requirements for IRA Trustees and Custodians (PDF)
5 pages. Excerpt: "If a minimum distribution is required with respect to an IRA for a calendar year and the IRA owner is alive at the beginning of the year, the trustee that held the IRA as of December 31 of the prior year must provide a statement to the IRA owner by January 31 of the calendar year regarding the required minimum distribution ... This requirement is effective beginning with required minimum distributions for 2003 (so that the first reports are due January 31, 2003)." (Internal Revenue Service)

Another Question is Answered in the Who's the Employer Q&A Column
Corporation X owns 51% of Corporation Y. The remaining 49% is held by an ESOP sponsored by Corporation Y for the benefit of Corporation Y's employees. Are X and Y in a controlled group for all tax purposes? (BenefitsLink.com)

Enron Pension Legislation Update, from ASPA's Perspective
Excerpt: "Although many changes were made to the House bill, there remains some significant concerns. Foremost, is that the bill requires all DC plans to provide quarterly benefit statements, even if participants do not have the right to direct investments.... Even more ridiculous, the House bill requires all DC plans to give participants a quarterly investment education notice, once again even if they do not have the right to direct investments." (American Society of Pension Actuaries)

Handling an Improperly Terminated Defined Benefit Plan (No Notice Had Been Provided to PBGC)
From the ERISA Audit Report of March 2002. Excerpt: "[T]his case demonstrates the value of exploring voluntary compliance with government agencies, even when there are no formal procedures in place." (Reish Luftman McDaniel & Reicher)

Using Self Correction After the Audit Has Commenced
From the ERISA Audit Report for March 2002. Excerpt: "After a plan has received an audit notice, the plan sponsor cannot correct significant operational failures under the IRS' voluntary correction procedures, nor can it use the Self Correction Program (SCP) to self-correct without IRS approval or supervision. However, contrary to widely-held belief, SCP is still available after a plan is under audit for correction of insignificant operational failures." (Reish Luftman McDaniel & Reicher)

Web Site Provides Easily Understandable Explanation of United Kingdom's Pension System
Excerpt: "If you're trying to make sense of the complex world of UK pensions, this is the UK pensions website for you. We've already done the time-consuming research. Everything you need is explained quickly, simply and clearly." (PensionSorter.co.uk)

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


Analysis: DOL Guidance on Complying with the ERISA Claims and Appeals Regulation (PDF)
11 pages. Excerpt: "Starting this year, all employee benefit plans governed by the Employee Retirement Income Security Act (ERISA) must comply with the claims and appeals regulation issued by the Department of Labor (DOL) in November 2000. Plans affected include most retirement, health and welfare plans sponsored by an employer, union or joint board of trustees." (The Segal Company)

Opinion: Stock Option Accounting 'Reform' Would Gouge Taxpayers, Investors
Excerpt: "Senate Bill 1940, introduced in the U.S. Senate by Carl Levin (D-MI) and John McCain (R-AZ)... [would] raise billions in taxes, because private sector accounting rules would leave companies with little choice but to take a deduction for options based on the lower 'fair value' when they are issued, rather than the higher 'intrinsic value' when exercised." (National Taxpayers Union)




Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Senior Health Benefits Analyst for The Segal Company
in CA
Project Coordinator - Client Management for Transamerica
in CA
Sr. Benefits Consultant for Northern Trust Retirement Consulting, L.L.C.
in GA
Pension Consultant/Administrator for Wender & Company
in OH
Daily Valuation Manager for Growing Employee Benefits Firm
in MD
TrustMark Resource / Network Administrator for Growing Employee Benefits Firm
in MD
Benefits Manager for Powell, Goldstein, Frazer & Murphy LLP
in GA
Sales Position: 401(k) Retirement Specialist - California & Nevada! for Hartford Life Insurance Companies
in CA, NV
Putnam Regional Manager for Hartford Life Insurance Companies
in CA, MI, NV
Paralegal - Employee Benefits for The Nyhart Co., Inc.
in IN
Benefits Analyst/Coordinator for City of Houston
in TX



Newly Posted Conferences (Post Yours!)
2002 Employee Benefits Conferencein IL on May 29, 2002
presented by Illinois CPA Foundation
Cross Plan Testing & Compliancein CA on April 18, 2002
presented by WP&BC Orange County



Newly Posted Press Releases (Post Yours!)
AHI's Benefits Alert Releases New Free Report - "Know Your Notification Obligations" (Alexander Hamilton Institute)
Newkirk ePubs - Internet Content Archive and Delivery System for Financial Institutions (Newkirk)

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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.