| BenefitsLink Retirement Plans Newsletter |   |
May 5, 2005
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Health and welfare issues * 401(k) plans Employee compensation * Actuarial pension issues Health Savings Accounts * Legal & fiduciary issues You don't want to miss this one! Register online today. Brought to you by WP&BC and ASPPA. |
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Overview: IRC Section 402A Provides for Designated Roth Contributions to 401(k) Plans (PDF)
3 pages. Excerpt: "Proposed regulations providing guidance on the implementation of Roth 401(k)s were issued by the Internal Revenue Service on March 1, 2005. Final regulations are expected to be issued this year in time for plan sponsors to amend their plans to add Roth 401(k) contributions for 2006, if they so desire. [The target page provides discussion on the advantages and disadvantages of the Roth 401(k).]" (Transamerica Retirement Services)
Proposed Regulations Breathe Life Into the Roth 401(k) Plan--With Roth 403(b) Coming Next
Excerpt: "On March 2, 2005, the IRS issued proposed regulations for Roth contributions to 401(k) plans, rekindling interest in the subject. The rules regarding Roth contributions to 401(k) plans are summarized [on the target page]. [Ice Miller expects] similar regulations to be issued for Roth 403(b) shortly." (Ice Miller)
ERIC Update on, and Broad Outline of, Boehner Pension Bill
Excerpt: "Conversations with key Congressional staff indicate that House Education and Workforce Chairman John Boehner (R-OH) is still on track to introduce a pension funding & hybrid plan bill in the coming weeks. While timing of introduction is dependent on progress on the Congressional budget resolution as well as policy negotiations under way with the chairman of the House Ways and Means Committee Bill Thomas (R-CA), current expectations are that the bill will be introduced in 4-5 weeks." (The ERISA Industry Committee)
Trustee/Fiduciary: Prudent Man Rules -- Few Bright Shining Lines Guide Fiduciary Concerns
Excerpt: "In one of those structural oddities, plan fiduciaries are expected to operate a plan as if they had an investment policy, but are not actually required to have reduced that policy to a formal document. Ironically, it has become something of a truism that, if a plan comes under audit by the Department of Labor, the first thing sought is an investment policy statement." (PLANSPONSOR.com; one-time registration required)
Selecting and Monitoring Investment Professionals (PDF)
10 pages. Excerpt: "This article addresses salient legal issues confronting plan fiduciaries today in connection with the investment of employee benefit plan assets." (Benefits & Compensation Digest via International Foundation of Employee Benefit Plans)
Can Social Security Plans Age Gracefully? A Look at Plans Around the World
Excerpt: "Adair Turner, the head of the UK Pensions Commission, explains why pension reform will work only if people retire later and save more." (The McKinsey Quarterly)
Pre-Release Draft: Reforming Social Security: Lessons from Thirty Countries (PDF)
39 pages. Excerpt: "Since 1980, more than 30 countries around the world have adopted some kind of privately managed plan, usually based on personal accounts, as part of their social security systems. Each has done so in a different way. As the United States considers Social Security reform, including some form of personal accounts, it may be useful to examine options that other countries have implemented." (National Center for Policy Analysis)
Who Would Benefit If 30-Year Bonds Come Back?
Excerpt: "After a 3 1/2-year hiatus, the Treasury Department is considering reissuing 30-year bonds to help finance the federal government's budget deficits. A decision on whether to issue new 30-year bonds will be made Aug. 3, the Treasury Department said." (San Antonio Express-News; one-time registration may be required)
Companies Rethink Offering Company Stock in Their Retirement Plans
Excerpt: "It used to be that buying your employer's stock was a sign of pride, a vote of confidence or even a chance to get rich quick. But today, many employees are just as likely to file a lawsuit over company stock, alleging that their employers encouraged them to make what turned out to be a bad investment. As a result, some employers are closely reviewing their procedures for offering company stock in retirement plans. Others are giving thought to freezing the stock options altogether." (Workforce Management; one-time registration required)
Commentary: Tax Court Holds Worker is Independent Contractor for SEP Deduction Purposes
Excerpt: "One of the interesting aspects of the case ... was the discussion of benefits and how the '[r]eceipt of employee benefits is an important factor in determining whether an employer-employee relationship exists' .... The court pointed out that the State Department's provision of annual leave for the individual as well as reimbursement for 50% of the individual's health insurance costs pointed towards 'employee' status, while the absence of retirement benefits, or other employee ...." (Attorney B. Janell Grenier via BenefitsBlog.com)
Opinion: How Bush's Version of 'Progressive Indexing' Would Kill Social Security
Excerpt: "George W. Bush has come out in favor of a proposal for cutting Social Security benefits called 'progressive price indexing.' Or has he? On May 1, White House Chief of Staff Andrew Card appeared on Meet the Press. A proposal by Robert Pozen '... is really not necessarily the president's plan,' Card noted. 'It's directionally consistent with the president's plan.' So what does Pozen say, and where does Bush differ?" (Slate)
Another Question is Answered in the Who's the Employer Q&A Column
What are the functions of management? (BenefitsLink.com)
House Passes Bill to Raise Limit on Bank Deposit Insurance -- to $260,000 for Retirement Accounts
Excerpt: "The first increase in a quarter-century in the $100,000 account limit on federal bank deposit insurance would occur under a bill approved by the House, but its future is less certain in the Senate, .... The House overwhelmingly passed the measure Wednesday raising the ceiling on federal bank deposit insurance to $130,000, and to double that amount, $260,000, for individual retirement accounts and 401(k) plans held in banks." (AP via The New York Times; one-time registration required)
Tomorrow's Retirement Education & Advice: Multichanneled, Automated, Integrated—But Will It Be Used?
Excerpt: "As American workers struggle to fund their own retirement, the investment advice they get for their retirement plan investments is increasingly important. Ultimately, its quality may have a greater impact on their ability to retire than the quality, or the number, of the investment options available to them. After all, access to great investments cannot compensate for failing to use them, saving too little, or making bad asset allocation decisions, ...." (PLANSPONSOR.com; one-time registration required)
Links to Items on Executive Comp, Benefits in General
Overview: Significant ADEA Developments Affecting Employee Benefits (PDF)
4 pages. Excerpt: "Several recent court rulings significantly increase the risks of ADEA litigation against employers over employee benefits." (Groom Law Group)
Overview: Bankrup.tcy Reform Bill Enacted (PDF)
4 pages. Excerpt: "President Bush has signed the Bankrup.tcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) into law, generally effective for bankrup.tcy filings on or after October 17, 2005. .... BAPCPA also contains numerous provisions affecting employee benefits – e.g., retirement benefits, executive compensation and health insurance – in both individual and corporate bankrup.tcy filings. This For Your Information focuses on the benefit provisions of the new law." (Mellon Financial Corporation)
Newly Posted Press Releases
President Names Chair, Three Members To PBGC Advisory Committee
(Pension Benefit Guaranty Corporation (PBGC))
EBRI’s Salisbury Wins Lifetime Achievement Award
(Employee Benefit Research Institute (EBRI))
UMB Healthcare Services Division Announces Investment Options for Health Savings Account Services
(UMB)
Newly Posted or Renewed Job Openings
Benefits/Compensation Analyst
for Howrey Simon Arnold & White, LLP
in DC
Pension Administrator/Trust Accountant
for Primark Benefits
in CA
Pension Administrator
for Growing Pension Company
in MD
Handy Links:
- View Today's Active Message Threads
- Search BenefitsLink
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
Copyright 2005 BenefitsLink.com, Inc.; except that you may reprint this newsletter in full (including this sentence) without obtaining our permission.
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