| BenefitsLink Retirement Plans Newsletter |   |
August 26, 2003 - 13,314 subscribers
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Clouds Still Remain For Troubled Pension Funds
Excerpt: "Securities markets have boosted traditional pensions this summer, but companies with ailing plans aren't out of the woods yet. In fact, defined-benefit pensions could hit earnings harder in 2003 than in many years, despite recent recovery in the plans." (Dow Jones via SmartMoney.com)
Italy Seeks to Raises Retirement Age
Excerpt: "Premier Silvio Berlusconi's proposal to reform Italy's pension system by raising the retirement age by five years was received with caution Monday by his conservative allies. With Italy's aging population and declining birthrate, reform of Italy's pension system has been a key, albeit thorny, issue for governments in the last decade." (AP via Washington Post)
Overview: Ex-Spouse's QDRO Claim to Pension Benefits Had Priority Over IRS Tax Lien
Excerpt: "A divorced spouse's claim, pursuant to a QDRO, to the pension benefits of her former spouse had priority over an IRS tax lien because, under federal law, her claim was perfected and she became a judgment lien creditor on the date the divorce decree was entered, according to the U.S. Court of Appeals in St. Louis (CA-8)." (CCH News & Information Library)
Indiana Charges Eight Suspects in State Pension Theft Ring
Excerpt: "A former worker at the state's $10 billion Public Employees' Retirement Fund was charged Friday with stealing more than $226,000 in retirees' money, marking the third time in one year that federal prosecutors have uncovered serious problems at the fund." (The Indianapolis Star via NewsAlert.com)
Misappropriation of IRA Funds Was Grounds for Hardship Waiver of 60-Day Rollover Requirement
Excerpt: "The IRS has issued a letter ruling allowing [several particular] taxpayers more than 60 days in which to rollover funds between IRAs, after an individual hired to manage their investments misappropriated IRA funds." (CCH News & Information Library)
Overview: IRS Issues Final Section 457 Regulations (PDF)
Excerpt: "The final regulations amend the 1982 final Section 457 regulations to take into account several recent law changes and make several changes to the regulations proposed in 2002. However, the final Section 457 regulations retain certain unfavorable provisions included in the 2002 proposed regulations." (Buck Consultants)
California Lawmakers Urge State Pension Plan Trustees To Push for Lower-Cost Anti-HIV Drugs
Excerpt: "The California legislature passed a resolution last week calling on the state's public pension systems to use shareholder resolutions to push pharmaceutical companies into making anti-HIV medications affordable in developing nations." (Advocate.com)
How Can I Make Sure That Investment Education I Provide to My Employees Won't Be 'Advice'?
Excerpt: "The Department of Labor's Interpretive Bulletin 96-1 - here - outlines educational activities that will not constitute 'investment advice.' While there is pending legislation that may impact the definition of investment education, 96-1 is the most current federal regulation as of August 2003. There are four general categories of investment-related information and materials that you can provide employees...." (Financial Finesse via WorkIndex.com)
Retirement Plan Coverage of Baby Boomers and Retired Workers: Analysis of 1998 SIPP Data
Excerpt: "The pension coverage and the retirement prospects of baby boomers are a growing concern. Observers point to several pension trends that could threaten boomers' retirement security. Among these are low and stagnant pension coverage rates and the contraction in the number of traditional defined benefit (DB) plans ..." (AARP Research)
Available for Immediate Purchase & Downloading: Sal Tripodi's Commentary on Proposed 401(k) Regs
Use our new instant, secure download facility to nab Sal Tripodi's extensive commentary on the newly proposed 401(k) and 401(m) regulations: the 32-page Summer 2003 edition of ERISA Views. Written in an easy-to-understand format with many illustrative examples. Excerpt: "Our intention ... is to help you focus on the way existing administrative practices or plan designs might change if these regulations are adopted in their present form." (TRI Pension Services via BenefitsLink.com)
Links to Items on Executive Comp, Benefits in General
Shipping in October: Tape of ABA Program on Benefits Issues in Mergers and Acquisitions
$150, sold by the ABA. Excerpt: "Employee benefit plans can be a trap for the unwary in corporate transactions yielding hidden liabilities and risks. This audiotape program is a primer for the non-employee benefits practitioner focusing on the basic issues to watch for in a corporate transaction in retirement plans, executive compensation, and welfare benefit plans." (American Bar Association)
Overview: Employer's Section 83(h) Deduction Is Independent of Amount Employee Includes in Income
Excerpt: "Rejecting language in the preamble to the regulations under section 83 and decisions rendered by the Tax Court, the Sixth Circuit, and the Federal Claims Court, the Federal Circuit has ruled that an employer is entitled to a deduction under section 83(h) for amounts that are required to be included in an employee's income, even if such amounts are not actually reported on the employee's tax return or included in the employee's income on audit." (Deloitte & Touche's Human Capital Advisory Services)
Corporate Fiduciary Liability Claims In the Post-Enron Era
Excerpt: "[E]mployees have begun filing a new breed of ERISA class action lawsuits. Based on the same factual allegations generally contained in securities fraud cases, these lawsuits assert that the company and its directors and officers breached their fiduciary duties under ERISA by knowingly issuing false and misleading public statements about the company's financial condition, which induced employees to invest and maintain their plan assets in company stock at artificially high prices." (FindLaw.com)
Enron Backs Return of Money Paid to Former Executives
Excerpt: "Former employees of Enron Corp. have won the company's support in their quest to recover $53 million paid to a select group of executives a month before the energy firm filed for Chapter 11 bankruptcy protection." (AP via Washington Post)
WorldCom to Scrap Employee Stock Options
Excerpt: "WorldCom Inc. plans to scrap stock-option grants for employees to reduce the potential for conflicts of interest after it emerges from the largest U.S. bankruptcy case, people familiar with the matter said." (Bloomberg News via Los Angeles Times; one-time registration required)
Newly Posted or Renewed Job Openings
Pension Sales Design Specialist
for American National Insurance Company
in TX
ERISA Attorney
for Ward, Rovell & Van Eepoel, P.A.
in FL
US HR Benefit Manager
for Celestica
in CO, NH
MANAGER, Long-Term Care Compliance
for MetLife
in CT
Newly Posted Webcasts
(Post Yours!)
Catch-Up Contributions Under the New Regulations
on September 16, 2003
presented by SunGard Corbel Inc.
Handy Links:
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