| BenefitsLink Retirement Plans Newsletter |   |
November 2, 2004
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IRS Official Highlights Changes in 403(b) and 457 Plans at Actuarial Conference
Excerpt: "Robert Architect, a Senior Tax Specia.list at the IRS, headlined a workshop entitled 'The Brave New World of 403(b)s' at the 2004 American Society of Pension Professionals and Actuaries (ASPPA) Annual Conference in Washington, DC on October 27, 2004. Architect's presentation covered upcoming and recently issued guidance on Code Sec. 403(b) and 457 plans as well as examination issues and potential trouble spots in those areas." (CCH Pension & Benefits News)
IRS to Reduce Cost of Making Omitted Employee Whole Under EPCRS
Excerpt: "At a recent meeting with benefits practitioners, IRS officials previewed several changes to the Employee Plans Compliance Resolution System (EPCRS), which was most recently updated slightly over one year ago. The most significant of these prospective changes shows how to correct a plan's failure to let an eligible employee participate in a 401(k) plan." (Thompson Publishing Group Inc.)
Audio: Investment Firm Aims to Simplify Retirement Accounts
Excerpt: "For some people, the biggest roadblock to saving for retirement is inertia. A new kind of investment firm helps simplify the 401k process. Their clients are people enrolled in company-sponsored retirement plans who don't want to bother with the details. Hear NPR's Laura Sydell." (Morning Edition on National Public Radio)
Why 401(k)s Still Make Sense for Retirement Savings Instead of Roth IRAs
Excerpt: "An anti-401(k) faction claims that young and low income individuals should contribute to Roth IRAs instead of 401(k) plans. The amount alone of a 401(k) retirement withdrawal may push a lower-paid individual up to a higher tax bracket. Not so with Roth IRA money -- which comes out tax free. Also, the 401(k) distributions may subject part of the participant's Social Security benefits to income tax. So go the warnings." (Martha Priddy Patterson via Thompson Publishing Group Inc.)
Pension System Future May Turn on Cash Balance Pension Plan Decisions
Excerpt: "Often hailed as the one bright, shining star in the dimming universe of the defined benefit pension system, cash balance plans are now clouded by an onslaught of legislation and litigation - measures that may soon threaten all employer-sponsored retirement vehicles." (Employee Benefit News)
The Cash-Balance Battle Grinds On: 'Massive Plan Termination' Is Possible Unless Congress Acts
Excerpt: "Give round one to Kathi Cooper. She's the IBM employee whose lawsuit over the computer giant's conversion to a cash-balance plan helped transform the plans from one of the most popular kinds of corporate pensions into one of the most controversial, and contentious. .... Even before IBM's case is resolved, federal lawmakers are expected to pick up next year where they left off earlier this year in drafting new pension guidelines." (Workforce Management)
Next Congress Could Pass Pension Bill, Experts Say
Excerpt: "With the prospects dim for Congress passing legislation this year to address the concerns of defined benefit plan sponsors, pension advocates are looking to the next two-year congressional cycle for a fix to their problems. 'The 109th Congress has the potential to be know[n] as the Pension Congress,' forecasts Stuart Brahs, The Principal Financial Group's vice president of federal government relations." (Employee Benefit News)
Plan Sponsors Demand More Employee Financial Education from Plan Providers and Vendors
Excerpt: "Many plan sponsors are focused on increasing the number and quality of financial education programs offered by their plan providers, .... 'It's the No. 1 issue for our perspective clients,' observes Jacque Mohs, second vice president of retirement services at The Principal Financial Group. The coming wave of retiring baby boomers and the perceived ineffectiveness of financial education programs are driving plan sponsors to re-evaluate their retirement plans, Mohs says." (Employee Benefit News)
Free 401(k) Education Seminars for Small Businesses Offered by the Retirement Solutions Foundation
Excerpt: "Are you a small business with a 401(k) plan that some of your employees aren't taking advantage of? Retirement Solutions Foundation, a non-profit organization whose mission is to boost retirement savings, has received a grant for small business 401k education that involves offering free educational seminars, focus groups and follow-up to employees of small businesses. Any questions, please email Retirement Solutions president Jane White at smallbusiness@retirement-solutions.org." (Retirement Solutions Foundation via 401khelpcenter.com)
Four Public Pension Funds Seek Changes in Halliburton Board
Excerpt: "Four pension funds for public employees have filed a shareholder proposal seeking to give investors the power to nominate two directors to the board of Halliburton. Officials of the pension funds said Halliburton's 11-member board had failed to protect shareholder interests adequately by allowing the company to engage in activities that have hurt its reputation and stock price." (The New York Times; one-time registration required)
Full Text of November 2004 Edition of Monitor United Kingdom Published by Towers Perrin (PDF)
8 pages. Excerpt: "While it does not make any specific recommendations on pensions policy, the independent Pensions Commission's First Report clearly signals the need for radical action on the UK's pensions and retirement savings system. It suggests three possible ways forward: a major revitalization of the current voluntary system, and/or significant changes to the state system, and/or an increased level of compulsory private pension saving." (Towers Perrin)
Links to Items on Executive Comp, Benefits in General
Companies Hurry to Comply With Internal Controls Rule Mandated Under the 2002 Sarbanes-Oxley Act
Excerpt: "Thousands of public companies and their auditors are racing to meet year-end deadlines that require them for the first time to certify the strength of their financial checks and balances, an intense and costly effort that regulators call the most important reform to spring from the recent wave of accounting scandals. Scores of companies are struggling to finish the process on time, and a significant minority lags in the work, according to industry experts." (The Washington Post; one-time registration required)
Overview: Tax Law Requires Changes to Most Employers' Non-Qualified Deferred Compensation Plans (PDF)
6 pages. Excerpt: "The new requirements are generally effective for amounts which are either deferred, or become vested, on or after January 1, 2005. Prior law (including constructive receipt concepts) remains in effect for deferred compensation that is both earned and vested prior to 2005, unless the non-qualified deferred compensation plan is materially modified after October 3, 2004. The Treasury Department is expected to issue guidance in the near future regarding transition issues." (Ballard Spahr)
Perspective: Director Compensation 2004: Time to Reexamine Pay Philosophy
Excerpt: "This Perspective summarizes recent data from our annual study of 350 of the largest publicly traded companies in the US (the 'Mercer 350') and provides a framework for structuring director pay going forward." (Mercer Human Resource Consulting; one-time registration required)
Full Text: PricewaterhouseCoopers Analyzes American Jobs Creation Act (PDF)
60 pages. Excerpt: "The Act is the first major corporate tax act in a number of years, with the most sweeping business tax changes since the Tax Reform Act of 1986. The American Jobs Creation Act will affect most U.S. companies, and is estimated to provide nearly $137 billion in tax relief over the next 10 years." (PricewaterhouseCoopers via Financial Executives International)
Newly Posted Events
Domestic Partner Benefits and Benefits Issues Around Same-Gender Marriage
in Ohio on November 18, 2004
presented by WEB (Worldwide Employee Benefits Network) Cleveland Chapter
Form 1099-R - Not As Simple As It Looks
Nationwide on December 14, 2004
presented by SunGard Corbel
Legislative Overview and Update
in District of Columbia on November 18, 2004
presented by International Society of CEBS - Capital Chapter
Newly Posted Press Releases
TRI-AD’s Survey Reveals Opposition to Employers Switching to Health Savings Accounts Increases Among Flexible Spending Account Participants
(TRI-AD)
DailyAccess Awarded AITA Technology Company of the Year 2004
(DailyAccess Corporation)
Newly Posted or Renewed Job Openings
Pension Administrator
for Berlin, Ramos & Co.
in DC, MD, VA
Health Policy Consulting Manager
for A major international professional services firm
in CA
H&W Benefits Operation Manager
for Hewitt Associates
in IL
Benefits Project Manager
for Hewitt Associates
in IL
ESC Production QC Specialist
for Providian
in CA
Director, Product Development
for BISYS Retirement Services
in PA
Manager, Client Services
for BISYS Retirement Services
in PA
Plan Administrator
for Third Party Administrator
in PA
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