| BenefitsLink Retirement Plans Newsletter |   |
December 8, 2004
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New IBM Hires Lose Access to Defined Benefit Pension Plan, but Gain Enhanced 401(k) Plan
Excerpt: "The future of cash-balance plans literally hangs in the balance, as International Business Machines pursues an appeal of the landmark court ruling that its 1999 traditional defined benefit plan conversion to the nearly 20-year-old CB hybrid savings concept discriminates against older workers. [And,] starting on January 1, 2005, all new U.S. hires at IBM will be enrolled in a newly designed '401(k) pension' rather than the controversial cash-balance plan." (PLANSPONSOR.com; one-time registration required)
Is a 403(b) Determination Letter Program in the Offing? IRS Director of Employee Plans Responds
Excerpt: "With the recent issuance of long-anticipated IRS guidance on 403(b) plans, some have questioned whether the IRS Employee Plans Division intends to establish a determination letter program for 403(b) plans. According to Carol Gold, the IRS Director of Employee Plans, the EP 'has been considering the future possibility of a determination letter program' for 403(b) plans but is not yet ready to implement one. The EP is in the midst of establishing a new determination letter program ...." (CCH Pension & Benefits News)
Abstract of Working Paper: Has the Unified Budget Undermined the Federal Government Trust Funds?
Excerpt: "In order to ease the burden on workers during the retirement of the baby boom generation, the 1983 Social Security Reforms set payroll taxes above the level needed to pay current benefits, thus partially prefunding the baby boomers' retirement. The military and civil service retirement programs followed suit in the mid-1980s and switched from pay-as-you-go financing to funded systems. The excess income generated by these retirement programs was held in the federal trust ...." (National Bureau of Economic Research)
Bill to Phase Out Open Seasons for the Federal Thrift Savings Plan Awaits Bush's Signature
Excerpt: "Legislation that will make it easier for federal employees to manage their accounts in the Thrift Savings Plan was approved by the Senate yesterday and sent to President Bush for his signature. The measure will eliminate the TSP's twice-a-year 'open seasons,' the only time employees can change the amount they contribute from their salaries toward their retirement." (The Washington Post; one-time registration required)
CalPERS Discloses How Much the Pension Fund Paid for High-Risk Investment Funds
Excerpt: "The nation's largest pension fund disclosed for the first time yesterday how much it paid the venture capitalists, hedge fund managers and others who handle its riskiest specialized investments, and how well those investments performed in recent years. The information, which had been secret, was released by the California Public Employees' Retirement System, or CalPERS, to settle a lawsuit by the California First Amendment Coalition, a small nonprofit group that had argued that ...." (The New York Times; one-time registration required)
The Social Security Administration Has Posted the Section 419 Notice on Possible Benefit Reductions (PDF)
1 page. Excerpt: "The Social Security Administration has posted the Section 419 Notice at www.socialsecurity.gov/form1945. Beginning on and after January 1, 2005, state and local governments who hire individuals in positions not covered by Social Security must provide the Section 419 Notice to such individuals. The Notice explains the possible reduction of their future Social Security benefit because they are taking a non-Social Security covered position." (National Council on Teacher Retirement)
Another Question is Answered in the Who's the Employer Q&A Column
Husband and wife work for same company; husband owns 100%. They have a minor child. They obtain a divorce. Wife continues working for the company. Is she still an HCE for future plan years? (BenefitsLink.com)
Links to Items on Executive Comp, Benefits in General
Understanding the Section 457(b) Nonqualified Deferred Compensation Plan
Excerpt: "Code Section 457 applies to an employer-sponsored retirement plan maintained by a state, local government or tax-exempt organization (other than a governmental unit), so anyone working for an organization of this type is eligible to participate in this type of retirement plan. These plans are commonly referred to as nonqualified deferred compensation plans." (Marco Island Eagle)
The Segal Company's 2005 Reporting & Disclosure Calendar for Multiemployer Plans in Printable Form (PDF)
23 pages. Excerpt: "This year, for the first time, [The Segal Company] created an easy-to-print, multiple-page PDF version of the 2005 Reporting & Disclosure Calendar for Multiemployer Plans." (The Segal Company)
The Segal Company's 2005 Reporting & Disclosure Compliance Calendar for Multiemployer Plans
Excerpt: "The Segal Company's 2005 Reporting & Disclosure Calendar for Multiemployer Plans summarizes compliance requirements for qualified, single employer benefit plans. [There is] a brief description of each requirement and information about such details as the plan(s) affected, filing requirements and due dates ...." (The Segal Company)
Retirees Return to the Workplace, but This Time It's on Their Own Terms
Excerpt: "While some other companies are rewriting their retirement policies to keep older workers from retiring, Eli Lilly and Procter & Gamble identified a different talent pool: retired professionals who wanted to return to work on a limited basis. In surveys, older workers say they would like to scale back their hours, in 'phased retirement,' rather than leave altogether. Some need the money; others want the challenges or camaraderie." (The New York Times; one-time registration required)
Advocates Hail Pennsylvania Court's Ruling on Same-Sex Benefits As Significant
Excerpt: "Monday's Pennsylvania Supreme Court ruling that extended benefits to same-sex partnerships did not alter the state's definition of marriage as a bond between a man and a woman. But advocates for g.ay and les.bian rights said yesterday that the court's ruling clearly defined same-sex partnerships as having a legal status separate from marriage." (The Philadelphia Inquirer; one-time registration required)
Comments on Executive Pay as Covered by Broc Romanek at TheCorporateCounsel.net Blog
Excerpt: "If you practice in the executive compensation arena, you need to be reading Broc Romanek who is following developments pertaining to a new wave of executive compensation lawsuits. .... One such lawsuit names the CEO, other executives, directors and the general counsel and 'seeks to recover money for the corporation almost solely on the basis that no corporate director could in good faith have allowed executives to have collected the amount of money that was paid' to them." (Attorney B. Janell Grenier via BenefitsBlog.com)
Letter to Treasury Requesting Guidance Under Section 409A of P.L. 108-357 re: NQDC Plans (PDF)
7 pages. Excerpt: "On behalf of the HR Policy Association, I am writing to provide additional information and request additional guidance on the implementation of new Internal Revenue Code section 409A under section 885 of the American Jobs Creation Act, P.L. 108-357. These comments expand on and supplement our comments dated October 29, 2004." (HR Policy Association)
New Book: Pay Without Performance-- the Unfulfilled Promise of Executive Compensation
Excerpt: "Out-of-control executive compensation schemes are 'widespread, persistent, and systemic,' and new reforms won't clean up the mess, argue law professors Lucian Bebchuk and Jesse Fried. Q&A and book excerpt." (Working Knowledge)
Commentary: JPMorgan Creates a New Option for Stock Options
Excerpt: "JPMorgan Chase & Co. is about to blaze a new path with employee stock options, showing you can do something socially responsible and useful, while also making a profit. In the last couple of years, JPMorgan has done major deals on stock options with Microsoft Corp. and Comcast Corp. Both companies offered to buy packages of options previously granted to employees. Then those packages were re-bought by Morgan, after first stripping away forfeiture and other provisions unique ...." (Bloomberg News)
Newly Posted Events
Certified Retirement Services Professional (CRSP) Exam
in North Carolina on June 18, 2004
presented by Institute of Certified Bankers
Certified Retirement Services Professional (CRSP) Exam
in South Carolina on January 29, 2005
presented by Institute of Certified Bankers
Certified Retirement Services Professional (CRSP) Exam
Nationwide on February 18, 2005
presented by Institute of Certified Bankers
Certified Retirement Services Professional (CRSP) Exam
in North Carolina on June 18, 2005
presented by Institute of Certified Bankers
Certified Retirement Services Professional (CRSP) Exam
Nationwide on August 5, 2005
presented by Institute of Certified Bankers
HSAs for Beginners
Nationwide on October 21, 2004
presented by Employee Benefits Institute of America Inc. (EBIA)
Newly Posted or Renewed Job Openings
Enrolled Actuary
for Long Island Employee Benefits Group, Ltd.
in NY
Benefits Service Manager
for Hewitt Associates
in IL, WI
Sales Representative
for National Retirement Services, Inc. (NRS)
in CA
Sr. Director of Sales
for Convergys
in ANY STATE, CT, DC, MA, MD, NJ, NY, PA
Account Executive Director- Retirement Services
for Principal Financial Services
in MI
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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