| BenefitsLink Retirement Plans Newsletter |   |
December 7, 2004
Today's sponsor: Kiplinger
(Click on company name or banner to learn more.)
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(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
401(k)s -- Managed Accounts and Fees
Excerpt: "When it comes to discretionary management of 401(k) accounts, the pricing is all over the map - and in some cases, off the charts. With providers charging asset-based fees ranging from 0.05% to 1.5%, Brian Tarbox, who helped bring about a Department of Labor advisory opinion that laid the foundation for managed accounts in 401(k)s, thinks that under most circumstances, the higher fees are 'not justifiable.'" (Investment News)
PLAN SPONSOR's 2004 Defined Contribution Survey
Excerpt: "A record 3,975 plan sponsors responded to our survey this year, running the gamut of plan sizes, representing a 22% increase in usable responses from the 2003 survey.' Target site has links to the Plan Sponsor Magazine Cover Story on the Survey, Industry Snapshots, Provider Listings, Best in Class awards for the small, medium and large markets, and Methodology. (PLANSPONSOR.com; one-time registration required)
Pension Benefit Guaranty Corporation Raises Top Annual Benefit 2.8% to $45,614
Excerpt: "The federal agency that protects private sector pension plans announced yesterday that the maximum annual benefit for plans taken over in 2005 will be $45,614 for workers who wait until age 65 to retire. The Pension Benefit Guaranty Corp. said that figure represents an increase of 2.8 percent from the 2004 maximum annual benefit of $44,386. It was the largest one-year increase in the maximum for workers retiring at age 65 since a 5.5 percent jump in 2002." (AP via The Washington Post; one-time registration required)
Overview: IRS Releases Phased Retirement Rules (PDF)
4 pages. Excerpt: "The IRS has issued significant new proposed regulations on phased retirement programs under qualified defined benefit or money purchase pension plans (but not Section 457(b) plans). The proposed rules set forth the criteria for paying a pro rata portion of an accrued benefit to a participant who has partially retired. A phased retirement program would be permitted on a dual-status basis under which a participant would be treated as partially retired and partially employed." (Mellon)
Independent Group Creates ERISA Fiduciary Guild with Goal of Objective Oversight of Retirement Plans
Excerpt: "Stephen J. Lansing, a certified employee benefit specia.list, Matthew D. Hutcheson, certified consultant and Brooks Hamilton, an ERISA attorney, have joined forces to form an independent fiduciary organization designed to restore confidence in the retirement plan market through a high level of education, camaraderie, and accountability." (financial-planning.com)
Opinion: the Direction of Retirement Policy Reform in the United States
Excerpt: "While virtually everyone understands the global nature of terrorism, few people recognize that many of the long-term economic problems our country faces also are global. None is greater than the crushing economic pressures the industrial world's retirement and health-care systems -- Social Security and Medicare in the U.S. -- face in the decades ahead." (Pat Boone via The Washington Times)
Question on Retirement Plan Loans/Withdrawals and Financial Education
Excerpt: "Question: Our retirement plan does not offer loans; hardship withdrawals are available. The withdrawal is processed when the employee requests it, with no questions asked. Can a financial education provider act as a gatekeeper and help educate employees about options to the hardship withdrawal? Answer: Financial education can play a major role in deterring employees from taking hardship withdrawals by educating them on the downsides and by providing them with alternatives to consider." (Workindex.com)
Social Security Reform Tops Bush Domestic Plan
Excerpt: "The White House signaled yesterday that Social Security reform will be the domestic focus of President Bush's second term, saying for the first time that adding to the national debt in the short term is an inevitable aspect of incorporating private retirement accounts into the system." (The Washington Times)
Opinion: Inventing a Crisis in Order to Privatize Social Security
Excerpt: "Privatizing Social Security - replacing the current system, in whole or in part, with personal investment accounts - won't do anything to strengthen the system's finances. If anything, it will make things worse. Nonetheless, the politics of privatization depend crucially on convincing the public that the system is in imminent danger of collapse, that we must destroy Social Security in order to save it." (The New York Times; one-time registration required)
What is the Employee Plans Compliance Resolution System (EPCRS)? -- Answer Revised 12/03/04
Excerpt: "EPCRS is the overall name for the three IRS programs that correct operational and plan document errors affecting qualified plans, 403(b) plans, SEPs, and SIMPLE IRAs. EPCRS -- which includes the Self-correction Program (SCP), the Voluntary Compliance Program (VCP), and the Closing Agreement Program (CAP) -- is updated on a recurring basis. The latest update can be found in Revenue Procedure 2003-44, issued in June 2003." (McKay Hochman Co., Inc.)
Links to Items on Executive Comp, Benefits in General
Overview: Impact of WFTRA on the Definition of Dependent for Employee Benefit Plan Purposes (PDF)
3 pages. Excerpt: "This Mintz Levin publication reviews the [Working Families Tax Relief Act of 2004] rewrite of Code §152 to define the term 'dependent' to mean either a 'qualifying child' or a 'qualifying relative.' It also reviews consequences of the Acts' provisions regarding dependents including: Group Health Plans, Dependent Care Assistance Plans, 401(k) Plan Hardship Distributions, 457 Plan Unforeseeable Emergencies, [and] Non-Qualified Deferred Compensation Plans." (Mintz Levin Cohn Ferris Glovsky and Popeo P.C.)
What Is a Dependent? Under the New Working Families Tax Relief Act of 2004, That Is!
Excerpt: "Perhaps it's time that George Orwell's book '1984' should be re-titled '2004'. The fact that in 2004 we have seen the need to define who is a child and who is a spouse is truly Orwellian, and Bob Dylan's song, The Times They Are a Changin' is even more meaningful to us now! The new Working Families Tax Relief Act of 2004 (WFTRA '04) has given us a new uniform definition of 'dependent', who shall from this day forth be known as a 'Qualifying Child' or as a 'Qualifying Relative.'" (McKay Hochman Co., Inc.)
Supreme Court Rules That Same-Sex Benefits for Philadelphia City Workers Ok
Excerpt: "The city acted within its powers six years ago when it extended benefits to the same-sex 'life partners' of its employees, the state Supreme Court ruled yesterday. The Supreme Court overturned a two-year-old Commonwealth Court decision that held that the city had overstepped its authority in the 1998 ordinance that awarded same-sex couples employee benefits." (The Philadelphia Inquirer; one-time registration required)
New Form 8-K Rules Increase Scope/Accelerate Filing Deadline of Executive Compensation Disclosures (PDF)
3 pages. Excerpt: "In March 2004, the Securities and Exchange Commission ... revised the Current Report on Form 8-K (effective August 23, 2004), to broaden the scope of required disclosures and to accelerate the filing deadline to four business days after a triggering event. (SEC Release Nos. 33-8400; 34-49424; March 16, 2004) The SEC's renewed interest in material contracts with executives and the hiring and termination of employment of principal corporate officers is expected to translate...." (Pillsbury Winthrop LLP)
Full Text: Executive Compensation Reform and the Limits of Tax Policy (PDF)
24 pages. Excerpt: "Congress recently enacted its most significant effort in decades to reform executive deferred compensation. The new legislation rewrites the tax rules for billions of dollars that corporate managers defer outside the tax-qualified pension, 401(k), and other retirement plans that cover rank-and-file employees. But the legislation misses the mark for effective reform.' A summary of the report is at http://www.urban.org/url.cfm?ID=311113. (Urban Institute)
Home Depot Dangles a Broad Benefits Package to Woo Older Workers
Excerpt: "More Americans over 50 are working today than at any time in decades. Their numbers have risen seven percentage points in the past decade, reaching 46% last year. Home Depot wants these older workers to staff its 1,700-plus stores in North America and Puerto Rico. Earlier this year, the Atlanta-based chain formed a national hiring partnership with AARP to help fill 35,000 jobs it plans to add in 2004. That accounts for a big chunk of the 100,000 new workers the company expects to ...." (PLANSPONSOR.com; one-time registration required)
The 5th Circuit Rules on Rogers v. San Antonio (5th Cir., 12/2/04) (PDF)
36 pages. The 5th Circuit Court ruled that USERRA grants military reservists the right to equal, but not preferential treatment with respect to job upgrade benefits. (Findlaw)
Newly Posted Events
2004 Form 5500 - Review and Current Issues
in Illinois on March 10, 2005
presented by ASPPA Benefits Council of Chicago
Leadership Summit on Disease Management and Chronic Care
in District of Columbia on April 4, 2005
presented by World Congress
Online Course - Retirement Plan Services: Investments
Nationwide on January 3, 2005
presented by American Bankers Association
Online Course - Retirement Plan Services: Investments
Nationwide on June 20, 2005
presented by American Bankers Association
Online Course - Retirement Plan Services: Laws & Regulations
Nationwide on May 2, 2005
presented by American Bankers Association
Online Course - Retirement Plan Services: Plan Type and Design
Nationwide on March 14, 2005
presented by American Bankers Association
Outsourcing Employee Benefits Functions
Nationwide on December 8, 2004
presented by Employee Benefits Institute of America Inc. (EBIA)
Newly Posted Press Releases
Dietrich Launches ‘DietrichDirectQuote’ Online Fixed Annuity Quotes
(Dietrich & Associates, Inc.)
Newly Posted or Renewed Job Openings
Connections Quality Assurance Manager
for Hewitt Associates
in IL
Benefits Implementation Manager
for Hewitt Associates
in IL
Leaves Administration Consultant
for Hewitt Associates
in IL
Benefits Service Manager
for Hewitt Associates
in IL
Defined Contribution Project Manager
for Hewitt Associates
in NJ
DB Benefits Operations Manager
for Hewitt Associates
in CA
YSA Requirements Analyst
for Hewitt Associates
in FL
New Business Installation Administrator
for Transamerica
in CA
Institutional Trust & Custody Relationship Manager
for U.S. Bank
in MN
Financial Analyst
for Kindred Healthcare
in KY
Wellness Coordinator
for Kindred Healthcare
in KY
Project Manager
for Dickerson Employee Benefits
in CA
Health Benefits Program Administrator
for City of Bellevue
in WA
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