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The BenefitsLink Newsletter -
Retirement Plans Edition
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June 24, 2002 - 11,394 subscribers
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House Overwhelmingly Votes to Make Permanent the EGTRRA Pension Provisions
Excerpt: "The 308-70 vote Friday sent the Senate a bill to remove a 2010 expiration or 'sunset' date from a series of retirement tax breaks." (AP via Yahoo! News)

Over 1,350 ASPA Members Contacted Politicians re Repeal of EGTRRA Pension Sunset Provisions
Excerpt: "Thank you to the over 1,350 members who contacted their representative and asked for their support of H.R. 4931, the bill to permanently extend the pension reform provisions of EGTRRA. The bill passed the House on Friday, June 20, 2002, by a vote of 308 to 70." (American Society of Pension Actuaries)

9th Cir.: More Generous Eligibility Language in Plan Document Trumps Conflicting SPD Language (PDF)
Bergt v. The Retirement Plan for Pilots Employed by Markair, Inc. (No. 99-36106, 9th Cir. 06/19/02). Excerpt: "Although [plaintiff] Bergt qualifies to participate in the retirement plan by the terms of the plan master document, the SPD unambiguously prevents him from participating.... The critical issue in this case is how to interpret an ERISA plan when the plan master document unambiguously qualifies an employee as a member of the retirement plan, but the SPD unambiguously excludes him." (U.S. Court of Appeals for the Ninth Circuit via Findlaw.com)

Some Investment Managers Wish Proposed Changes to Cross-Trading Class Exemption Had Gone Further
Excerpt: "Pension officials welcomed a class exemption that the Department of Labor issued in February, permitting passive cross-trades of securities among index and model-driven funds and accounts that a single financial firm controls.... The new exemption extends the potential market for passive cross-trading to include ERISA plans." (PLANSPONSOR.com)

North Carolina Senate Takes Up Bill on Retired Teachers in Pay Status Who Return to Work
Excerpt: "A growing number of [teachers and administrators] have retired, returned to work and made a full salary plus a pension, something that legislators say violates IRS rules. They also say that the practice is based on a law that was never intended to allow what teachers and administrators widely call 'double-dipping.'" (The Winston-Salem Journal)

Arizona Government Retirees Await Results of Suit to Refund Taxes on Pension
Excerpt: "Nearly 52,000 retired state and local government workers in Arizona could be eligible for tax refunds averaging about $5,000 under a class-action lawsuit that claims retiree pension income was wrongly taxed by the state.... The lawsuit ... accuses the state of breaching its contract with all retired state and local government workers employed prior to 1989. Laws then in place promised employees they would not have to pay state income tax on their pensions, the lawsuit says." (The [Mesa, Ariz.] Tribune via International Foundation of Employee Benefit Plans)

Opinion: We Shouldn't Tolerate Pension Consultant Conflicts
June 2001 edition. Excerpt: "There are myriad ways in which a pension consultant may derive financial benefit from a pension fund it advises. When we investigate consultant abuses on behalf of pensions we look for the following methods of financial enrichment, some of which are legitimate, while others raise serious concerns." (The Benchmark Companies)

Overview: Corporate Pension Reform in Japan
Excerpt: "New rules for defined benefit plans, including a minimum funding requirement and other protections for plan participants, became effective in April 2002. The changes are likely to result in ... a trend away from traditional retirement plan designs." (Hewitt Associates)

Opinion: Opponents of Social Security Privatization Are Pension Pirates
Excerpt: "The plan here was to make Social Security look good by making personally owned pensions look bad, and to stop lower-income workers from using payroll taxes to contribute to their own voluntary retirement plan (that is, to a plan controlled by neither bosses nor union bosses)." (Washington Times)

Links to Items on Executive Comp, Benefits in General
(These items appear in both editions of the BenefitsLink Newsletter)

Spring/Summer 2002 Issue of IRS' Employee Plans News (PDF)
16 pages. Articles include New Law Makes Some Big Changes to Retirement Plans; Newer and Even More Improved Distribution Rules; Revised LRMs for SEPs, SARSEPs, SIMPLE IRA Plans and Other IRAs; Retirement Plan Life Cycle; Streamlined Procedures for GUST Late Amenders; Crossing an EGTRRA Amendment with a GUST Determination Letter Request; Good News for Fringe Benefit Plan Sponsors; Free 403(b)/457 CD-ROM. (Internal Revenue Service)

DOL Investigating Polaroid's Benefit Plans
Excerpt: "According to the filing, investigators are looking at a range of Polaroid benefit programs, including its pension, employee savings, group life insurance, retiree health insurance, severance, and long-term disability plans." (Boston Globe)

Ex-Enron CFO Wants Moratorium on ERISA Civil Suits
Excerpt: "Enron Corp.'s former chief financial officer wants a federal judge to grant him protection from civil lawsuits as the FBI pursues its criminal probe against him and others. Andrew Fastow created partnerships that earned him tens of millions of dollars and later helped fuel the energy company' s downfall." (StarTribune.com)

Opinion: Companies Need Honest Accounting of Stock Options
Excerpt: "Wall Street has decided it's time to stop pretending that stock options are free and account for them honestly, which means deducting the cost of options from corporate profits. Washington, naturally, has come to the opposite conclusion. Legislation to require companies to come clean about options costs is dying in the Senate ..." (Jerry Knight in the Washington Post)

IRS Wants Tech Firms to Report Option Values in Affiliate Deals
Excerpt: "In a renewed attack on technology companies' use of stock options, the Internal Revenue Service is seeking to force firms to report the options' value in deals with foreign affiliates, The Wall Street Journal reported Monday. If the IRS prevails, many technology companies that use foreign subsidiaries to make their products could be forced to pay hefty taxes on stock awards to both domestic and foreign employees." (Dow Jones Business News via Yahoo! News)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad
Actuary EA Pension-LLY for A Prestigious Consulting Company
in CA
401(k) Plan Administrator for Benefit Consultants
in AL
Associate Consultant for Benefit Consulting Firm
in TX

Newly Posted Webcasts (Post Yours!)
IRS §457 Regulations for Pension Plans on July 12, 2002
presented by National Association of Government Defined Contribution Administrators, Inc.
Social Security and Women: Future Challenges and Opportunities on June 19, 2002
presented by KaiserNetwork.org
Stock Options in the New Economy: Implications for Plan Design and Other Instruments on June 27, 2002
presented by Clark/Bardes Consulting - Compensation Resource Group

Newly Posted Conferences (Post Yours!)
Fundamentals of Retirement Plansin TX on September 12, 2002
presented by D/FW Chapter of ISCEBS
presented by SunGard Corbel
IRA SIMPLE/SEPin ALL STATES on July 23, 2002
presented by SunGard Corbel

Newly Posted Press Releases
Lynchval Provides General Release of Distributed Version of LVbatch (Lynchval Systems Worldwide Inc.)
SunGard Corbel Introduces Relius(tm) Government Forms 5500 Client Version - New Technology Automates Delivery of 5500s to Plan Sponsors (SunGard Corbel)
Sentinel Benefits Chooses SunGard for Straight-Through Processing - Growing Retirement Plan Recordkeeping Business Necessitates Automation (SunGard Corbel)
National Association of Government Defined Contribution Administrators Address IRS §457 Regulations for Pension Plans in July 12 NAGDCAST (National Association of Government Defined Contribution Administrators, Inc.)

Newly Posted Announcements of Promotions and New Personnel (Post Yours!)
Stanley K. Purcell (Pension Resource Group)

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