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The BenefitsLink Newsletter -
Retirement Plans Edition
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April 22, 2002 - 11,721 subscribers
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IRS Allows Existing Model IRA Forms to be Used Through September (PDF)
Excerpt: "In Rev. Proc. 2002-10 ... the Service provided that existing model IRAs, SEPs and SIMPLE IRA plans may not be used after June 1, 2002, to establish new IRAs, SEPs or SIMPLE IRA plans. In response to comments, the Service is extending the June 1 deadline to October 1, 2002." (Internal Revenue Service)

Senators Kerry and Snowe Weigh In With Another Bipartisan Pension Reform Bill in Senate
Excerpt: "The bill has a number of features in common with previously introduced measures, but takes a substantially different approach to diversification than other bills introduced to date. Bill text and a short summary from Kerry's office are now available here on the [American Benefits] Council Web site." (American Benefits Council)

Labor's Love of 401(k)s Thwarts Bid for Reform
Excerpt: "[O]fficials with the nation's largest labor group, the 13-million member AFL-CIO, insisted their opposition to a so-called company stock cap was largely tactical.... But the officials conceded they also were influenced by internal polls showing that union members are deeply enamored of their 401(k)s, often to a greater extent than they are of their financially more important and far less risky union-won pensions." (Los Angeles Times)

Another Question is Answered in the Who's the Employer Q&A Column
Company A and Company B each own 50% of the common stock of Company C. The common stock is the only class of voting stock of Company C. Pursuant to a shareholders' agreement between Company A and Company B, Company A has the sole right to appoint the directors of Company C. Are Company A and Company C in a controlled group? (BenefitsLink.com)

Massachusetts Securities Regulators Probing 1988 Polaroid ESOP Transaction
Excerpt: "According to Reuters, William Galvin, Secretary of the Commonwealth of Massachusetts and the state's chief securities regulator, said his office is investigating whether there was fraud when Polaroid established its employee stock ownership plan (ESOP) more than a decade ago." (PLANSPONSOR.com; free registration required)

IRS Provides Safe Harbor Tax Explanation in Spanish
Excerpt: "Code Section 402(f) requires that recipients of eligible rollover distributions receive written notice of the tax consequences of the distribution, including notice of the right to elect a direct rollover from the plan." (EBIA Weekly)

Speech to Pension Fund Trustees: Fundamental Truths About the Business of Managing Your Money
April 2002 Benchmark Alert. Excerpt: "What I have to tell you today I hope will be one of the most important investment speeches you ever hear. I want to give you an overview of the investment business, the business of managing and trading your money-- an insider's guide, that will serve you well in the future, both in your personal investing and in your role as a pension trustee." (Edward A.H. Siedle of The Benchmark Companies)

Florida State Employees Opting to Continue in DB Plan, Passing Up New DC Plan, by 10 to 1 Ratio
Excerpt: "[O]ut of 21,270 state employees who have signed up for presentations on the two retirement plans, only 540 opted for defined contribution. Another 5,943 decided to keep defined benefits - a stay-put ratio of better than 10 to 1 - while the rest are still mulling it over." (Tallahasee [Fla.] Democrat)

Liberal Think Tank Questions Administration's Proposal to Make EGTRRA Tax Cut Permanent
Excerpt: "Debate on locking these tax cuts into place for 2011 and all subsequent years comes at a time when new Congressional Budget Office projections show a dramatic deterioration in the budget outlook. The debate also comes only a few months after the President's Social Security Commission issued a report showing it was unable to come up with options to restore long-term Social Security solvency without drawing on large amounts of resources from the rest of the budget." (Center on Budget and Policy Priorities)

Analysis: IRS Issues Final Regulations on Required Minimum Distributions
Excerpt: "The new regulations will be helpful to employers, recordkeepers, and individuals. But implementing them will require many changes. For example, employers will need to review their plan documents and participant communications, recordkeepers will need to modify their calculation software, and individuals will need to review their estate plans." (EBIA Weekly)

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

Bankruptcy Judge Grants DOL Petition to Let State Street Take Control of Enron Benefit Plans
Excerpt: "U.S. Bankruptcy Judge Arthur Gonzalez ordered Friday that control of the plans be turned over to the State Street Corp. investment firm, Labor Department officials announced.... State Street now will be responsible for selecting plan investment managers, selecting and overseeing the funds offered as investment options to employees, and other duties." (AP via Lycos)

DOL Fact Sheet on Revised Delinquent Filer Voluntary Compliance Program
Excerpt: "The DFVC Program gives delinquent plan administrators a way to avoid potentially higher civil penalty assessments by satisfying the program's requirements and voluntarily paying a reduced penalty amount." (U.S. Department of Labor, Pension and Welfare Benefits Administration)

DOL Fact Sheet on Revised Voluntary Fiduciary Correction Program
Excerpt: "Many workers can benefit from the program as a result of the increased retirement security associated with restoration of plan assets and payment of additional benefits. It also will help plan officials understand the law. The program describes how to apply, the 14 specific transactions covered, acceptable methods for correcting violations and examples of potential violations and corrective actions." (U.S. Department of Labor, Pension and Welfare Benefits Administration)

Interactive Online Chart: 2002 Annual Reporting & Disclosure Calendar for Benefit Plans
Includes IRS, DOL and PBGC requirements. (The Segal Company)

About 5% of 2000 Forms 5500 Being Returned by DOL Due to Noncompliance with EFAST Program
Excerpt: "The U.S. Department of Labor's Pension and Welfare Benefits Administration announced today that it is returning plan year 2000 Form 5500 Annual Returns/Reports filed on non-standard forms, which cannot be processed by the department's new computerized ERISA Filing Acceptance System (EFAST). The department's plan gives affected filers an additional 60 days to resubmit their forms in an acceptable format." (U.S. Department of Labor, Pension and Welfare Benefits Administration)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Employee Benefits Attorneys -- Sacramento, California for Chang Ruthenberg & Long PC
in CA
Plan Specialist for Retirement Management Services, LLC
in KY
Pension Administrator/Actuary for Small Mid-Westchester New York Administration Firm
in NY

Newly Posted Conferences (Post Yours!)
Retirement at Risk: 401 K Management Post-Enronin IL on June 24, 2002
presented by Strategic Research Institute

Newly Posted Press Releases
Double-Digit Health Care Hikes Demand Employee Awareness (Benefit Software Inc.)
Newkirk's Enroll Plus(TM) makes state-of-the-art enrollment materials affordable (Newkirk)
Labor Department Announces Plan to Correct Non-Standard Form 5500 Returns/Reports (U.S. Department of Labor, Pension and Welfare Benefits Administration)

Subscribe to the Welfare Plans Edition, too (click)

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.