| BenefitsLink Retirement Plans Newsletter |   |
November 24, 2004
Today's sponsor: Actuarial Systems Corporation
(Click on company name or banner to learn more.)
ASC - QUALITY SOFTWARE FOR THE PENSION INDUSTRY FOR OVER 20 YEARS ASC provides complete automation for the pension office, including: DC/401(k) and DB administration and valuation systems, sophisticated Compliance Testing, DV Direct Daily Valuation, Advanced Information Manager Database (AIM), and Single-Step Processing. All ASC Technical Support Members were experienced Pension Administrators or Actuaries before joining ASC-- and most have been with ASC for over 10 years.
(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
Text of Corrections to Final Regulations on Minimum Distributions from DB Plans or Annuity Contracts (PDF)
1 page. Excerpt: "This document contains corrections to final regulations (TD 9130) which were published in the Federal Register on Tuesday, June 15, 2004 . . . These final regulations relate to the required minimum distributions under section 401(a)(9) for defined benefit plans and annuity contracts providing benefits under qualified plans, individual retirement plans, and section 403(b) contracts.' The final regs are online at https://benefitslink.com/taxregs/td9130.pdf (Internal Revenue Service)
2004 Plan Year-End Planning Checklist for Advisors, Employer/Plan Sponsors and Fiduciaries
Excerpt: "This article identifies year-end administrative, compliance and planning issues that require attention within the general timeframe indicated.' It includes information on Safe Harbor 401(k) Notice Requirements, Salary Reduction Arrangement Elections, Timing of Deposit of Employee Contributions, Beneficiary Designations, the Form 5500 Filing Requirement, the Minimum Distribution Requirement, and Fiduciary Review of various items. (Milberg Consulting LLC)
Chart of COLA Adjustments to Retirement Plan Limitations for 1996 - 2005 (PDF)
1 page. The chart includes maximum dollar limits for retirement plans -- contributions, deferrals, distributions -- and ESOP, Social Security, FICA, PBGC, and Medicare amounts. (Ice Miller)
Analysis: Defined Benefit Pension Plans vs. 401(k) Plans: the Returns for 2000-2002
Excerpt: "In previous studies, we had found that defined benefit plans generally attained higher returns than 401(k) plans. But in our 2002 and 2003 studies, we found that, in the late 1990s, 401(k) plans were realizing higher returns than were defined benefit plans. This analysis of 2000-2002 returns for both plan types shows a reversal, suggesting that defined benefit plans outperform defined contribution plans during bear markets, or at least in bear markets that follow sustained, ...." (Watson Wyatt Worldwide)
Big Changes Ahead for 403(b) Plans of Tax-Exempt Employers and Public Schools
Excerpt: "The IRS has issued proposed regulations on 403(b) plans .... Tax-exempt entities, public schools, and churches could face some significant challenges as they work to bring their plans into compliance by the proposed 2006 effective date. Generally, the regulations aim to make 403(b) plans more like 401(k) plans. Among the more significant changes: the need to adopt a written plan document; stricter nondiscrimination rules; and a new rule barring any benefits that are conditioned ...." (Washington Resource Group and the Information Research Center of Mercer Human Resource Consulting)
Overview: IRS Issues Guidance on Impact of PFEA '04 on Actuarial Assumptions for Distributions
Excerpt: "The IRS has issued guidance regarding the interest rate assumptions that must be used for determining the actuarial equivalence of lump-sum distributions for defined benefit plans in 2004 and 2005. This guidance reflects the change to the required interest rate rule of Code Sec. 415(b)(2)(E)(ii) that was made by section 101(b)(4) of the Pension Funding Equity Act of 2004 (PFEA '04) (P.L. 108-218), as well as anti-cutback relief provided under section 101(c) of PFEA '04 and the ...." (CCH Pension & Benefits News)
Work (Part Time) Until You Drop Under Proposed Rules for Defined Benefit Pension Plan Distributions
Excerpt: "Current IRS rules prevent still-active employees from drawing on their defined benefit pensions until they've reached a company's normal retirement age. Under the proposed rules, workers would be able to cut back their hours and live off a combination of a reduced salary and a partial pension. For example, a worker who scaled back to 60% of normal hours would be allowed to tap 40% of his early-retirement pension benefits." (Forbes.com)
Consulting Firm Recommends Against Concentration of Company Stock in DB and DC Plans
Excerpt: "Consulting firm Ennis Knupp is recommending that plan fiduciaries avoid a concentration of company stock in their defined benefit (DB) and defined contribution (DC) investment programs. In a research report, the consulting firm asserted that it is not prudent to have exposure to single-security risk in DB or DC plans, and any fiduciary who finds him or herself in such a position should reevaluate such holdings. This advisory opinion is not meant to apply to Employee Stock ...." (PLANSPONSOR.com; one-time registration required)
Links to Items on Executive Comp, Benefits in General
ERIC Submits Additional Recommendations to Treasury on Nonqualified Deferred Compensation (PDF)
November 23, 2004. Excerpt: "The ERISA Industry Committee ('ERIC') is pleased to submit the following recommendations for guidance under Internal Revenue Code § 409A, regarding nonqualified deferred compensation. Section 409A was added to the Internal Revenue Code by § 885 of the American Jobs Creation Act of 2004 (the 'AJCA'). Section 409A overhauls the federal income tax treatment of a wide variety of nonqualified deferred compensation arrangements." (The ERISA Industry Committee)
Committee Request for Written Comments on H.R. 5395 -- the Tax Technical Corrections Act of 2004
Excerpt: "Congressman Bill Thomas (R-CA), Chairman of the Committee on Ways and Means, today announced that the Committee is requesting written public comments for the record from all parties interested on H.R. 5395, the 'Tax Technical Corrections Act of 2004.'" (U.S. House Committee on Ways and Means)
2004 Worldwide Benefits Management Survey: Multinationals' Biggest Challenges - Costs and Risks (PDF)
24 pages. Excerpt: "Our latest worldwide benefits management survey was conducted between March and July of 2004. A total of 134 organizations in a wide range of industries responded to the survey, with European companies making up slightly over half (53%) the sample and North American companies comprising 42%. The average company surveyed has almost 30,000 employees worldwide." (Towers Perrin)
Newly Posted Press Releases
2005 Supplement to Governmental Plans Answer Book Now Available
(Calhoun Law Group, P.C.)
Hay Group Announces Medicare Part D Employer Survey: December 5, 2004 Deadline
(Hay Group)
Newly Posted or Renewed Job Openings
Insurance – Operations Manager
for Zenith Administrators
in NV
Chief Compliance Officer - Employee Benefits
for CitiStreet
in FL, MA
Insurance – Claims Supervisor
for Zenith Administrators
in NV
CS Project Manager
for Hewitt Associates
in IL
Attorney - Employee Benefits Firm
for HaynesHitesman PC
in KS, MO
ERISA Consultant
for BISYS Retirement Services
in MN
Employee Benefits Position-Tax Senior
for Deloitte & Touche LLP
in MI
WM HR Specialist - Recruitment
for Hewitt Associates
in IL
Workforce Management HR Specialist
for Hewitt Associates
in IL
Executive Director Benefits Finance
for Time Warner
in NY
Pension Administration Project Manager
for Hewitt Associates
in IL
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research
- Employee Benefits Library
Copyright 2004 BenefitsLink.com, Inc.; except that you can reprint this newsletter in full (if you also include this boilerplate part) without obtaining our permission.
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Editor and Publisher: David Rhett Baker, J.D.
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