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July 2, 2003 - 13,226 subscribers
Today's sponsor: ASPA

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

ASPA Summer Conference, July 27-30, Irvine, CA

ASPA’s 5th Summer Conference offers workshops designed with all
retirement plan professionals in mind. Find out about the latest
developments in the industry from the best in the business and
stay ahead of the curve! This is also a great opportunity to learn
more about ASPA’s QKA training program -- the industry's only
certification program devoted exclusively to 401(k) plans.
Visit http://www.asppa.org for more information.

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
IRS: Transfer of At Least 25% of DB Plan's Surplus Assets to DC Plan Avoids Income Tax
Revenue Ruling 2003-85. Excerpt: "[T]he direct transfer from Plan A to Plan B of $20X, an amount that is at least 25 percent of the maximum amount which the employer could receive as an employer reversion, is treated as follows: the amount transferred is not includible in the gross income of the employer, no deduction is allowable with respect to the amount transferred, and the amount transferred is not treated as an employer reversion for purposes of § 4980." (Internal Revenue Service)

Text of DOL Advisory Opinion on Terms of QPAM Prohibited Transaction Exemption
AO 2003-07A (June 19, 2003). Excerpt: "Request for guidance concerning section V(h) of PTE 84-14 which permits certain transactions between a party in interest with respect to an employee benefit plan and an investment fund in which the plan has an interest and which is managed by a [Qualified Professional Asset Manager], provided that the other conditions of the exemption are satisfied." (U.S. Department of Labor, Employee Benefits Security Administration)

Text of DOL Advisory Opinion on Receipt of 12b-1 Fees from Mutual Fund by Trust Company
AO 2003-09A (June 26, 2003). Excerpt: "Description of request: Whether a trust company's receipt of 12b-1 and subtransfer fees from mutual funds, the investment advisers of which are affiliates of the trust company, for services in connection with investment by employee benefit plans in the mutual funds, would violate ERISA when the decision to invest in such funds is made by an employee benefit plan fiduciary or participant who is independent of the trust company and its affiliates." (U.S. Department of Labor, Employee Benefits Security Administration)

Time to Redirect Your Retirement Savings?
Excerpt: "Since last month's tax-cut bill slashed rates on stock dividends and capital gains, a number of number crunchers have begun to question the wisdom of investing in tax-deferred retirement accounts, such as IRAs and 401(k) plans. This goes against the grain of the past couple of decades of retirement-planning advice. But times have changed -- so is it time for you to change, too? Let's take a look." (Albert B. Crenshaw in the Washington Post)

PBGC Seems Overwhelmed
Excerpt: "The PBGC serves as financial trustee for nearly 1 million individual pensioners-- up from 346,000 in 1993-- and pays out $2.5 billion a year.... Some are already disappointed by administrative delays and rules that limit their pensions. Advocates for retirees and agency officials defend the PBGC, saying the agency is performing admirably overall ..." (Washington Post)

How Have Older Workers Responded to Scary Markets? (PDF)
61 pages. Excerpt: "This paper reviews results from a Watson Wyatt survey of 4,500 individuals in the U.K. aged 50-64 to see how they were affected by changes in the equity market and how it affected their retirement plans as well as asset allocation. We also find that 25% of older working individuals are now planning to retire later than they had planned 2 years ago; there is a strong positive relationship between those delaying retirement and those most affected by the stock market decline." (Jonathan Gardner and Mike Orszag of Watson Wyatt LLP)

Assessing the Early Retirement Burden (PDF)
21 pages. Excerpt: "This paper develops a simple framework to assess the specific costs of early retirement and applies it using data from the OECD countries. More significantly, we find that the costs associated with early retirement are projected to rise considerably in the next ten years ... The projected rise in costs over the course of the next decade is largely due to population ageing ..." (Tryggvi Thor Herbertsson and J. Michael Orszag, published by Watson Wyatt LLP)

Opinion: We're Burdening Our Children
Excerpt: "Welcome to the era of baby boomer politics. It isn't Republicans vs. Democrats or liberals vs. conservatives. We have roughly 76 million baby boomers who, as they approach and enter retirement, want government to improve their lives. Politicians of all parties and persuasions seem primed to comply." (Washington Post)


Links to Items on Executive Comp, Benefits in General

IRS Disallows a Tax Shelter for Stock Options
Excerpt: "The Treasury Department and the Internal Revenue Service disallowed a tax shelter yesterday that executives bought to delay taxes on exercised stock options for 15 years. Public records show unusual transactions by L. Dennis Kozlowski, the indicted former chief executive of Tyco International, that fit the tax shelter's design." (New York Times; one-time registration required)


Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Compliance Administrator
for Bisys
in PA

HR, Compensation and Benefits Client Relationship Manager
for PricewaterhouseCoopers
in GA

401(k) Pension Administrator
for PENSERVCO, Inc.
in FL

Director of Retirement Sales
for Stanton Group
in AZ, CA, CO, NV, OR, WA

Lead Professional Employer Organization PEO Specialist
for Transamerica - The Winning Organization
in CA

Pension Consultant/Administrator
for Pension Consulting Firm
in MI
Newly Posted Conferences
(Post Yours!)

CEBS Course 8-Human Resources and Compensation Management
in ALL STATES
August 25, 2003
IFEBP/CEBS Program

CEBS Course: Compensation 1-Compensation Concepts and Principles
in ALL STATES
August 25, 2003
IFEBP/CEBS Program
Newly Posted Press Releases
(Post Yours!)

Ernst & Young to Pay $15 Million to Settle IRS Tax Shelter Marketing Dispute
(Internal Revenue Service)


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