Retirement Plans
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February 10, 2006
Today's sponsor: APSCREEN, Employee Locator

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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)

IRS Employee Plans News, February 9, 2006, Special Edition (PDF)
2 pages. Excerpt: "This Special Edition announces the issuance of the proposed regulations on designated Roth accounts and updated frequently asked questions, announces that the Employee Plans Compliance Unit is up and running, and, also, highlights the opening of the Determination Letter Program for Cycle A individually designed plans." (U.S. Internal Revenue Service)

Overview; IRS Provides KETRA Guidance (PDF)
5 pages. Excerpt: "This guidance applies to qualified plans, ERISA 403(b) plans, and governmental section 457(b) plans and to participants in those plans who were directly affected by Hurricane Katrina. It also applies to affected participants in non-ERISA 403(b) programs." (Prudential Retirement)

Overview: Safe Harbor 401(k) Plans for 2006
Excerpt: "The recently issued final 401(k) and 401(m) regulations are effective for plan years beginning on or after January 1, 2006 unless the sponsor elects to implement them sooner. For the first time, we will have regulations that address the operation of safe harbor 401(k) plans." (McKay Hochman Co., Inc.)

SIMPLE IRA, SIMPLE 401(k) and Safe Harbor 401(k) Comparison Chart Updated
The chart was updated January 26, 2006. (McKay Hochman Co., Inc.)

FAQs Regarding Designated Roth Accounts
Excerpt: "These FAQ's are based on the final regulations, Designated Roth Contributions to Cash or Deferred Arrangements Under Section 401(k) released January 3, 2006 and proposed regulations, Designated Roth Accounts released January 26, 2006." (U.S. Internal Revenue Service)

Know the Hidden Escape Hatch in Your 401(k)
Excerpt: "Frustrated by the limited investment choices available in your employer's retirement plan? Don't fret. You might not have to wait until retirement to unlock the investment potential of those retirement plan assets." (The Olympian Online)

Bill to Close Colorado PERA to New Hires Rejected by House Committee
Excerpt: "A bill proposing the Colorado Public Employees' Retirement Association (PERA) be closed and a defined contribution plan be implemented instead was rejected by the state house's Business Affairs and Labor Committee." ( one-time registration required)

Capital Market Update: Funded Ratio Moves Up in January 2006 (PDF)
4 pages. Excerpt: "Strong equity markets and an increase in long bond yields combined to make January a very positive month for pension plan financing. The funded ratio for our benchmark plan increased by 3.0 percentage points . to 85.5%." (Towers Perrin)

Overview: President Signs Act Including Increases to PBGC Premiums (PDF)
2 pages. Excerpt: "Although the Act does not include any changes to the variable-rate premium, legislation impacting this premium is under consideration." (Gardner Carton & Douglas LLP)

4010 Temporary Gateway Test
Excerpt: "As provided in Technical Update 06-1, ERISA section 4010 reporting is waived for information years ending on or after December 31, 2005, and on or before June 30, 2006, provided no filing would be required if, for purposes of the 4010 Gateway Test, the PFEA 85% Corporate Rate is used for valuing vested benefits for plan years ending on or after December 31, 2005." (U.S. Pension Benefit Guaranty Corporation)

Overview: IRS's 2005 Cumulative List -- Changes in Plan Qualification Requirements
Excerpt: "It is of particular interest for individually designed plans of employers whose taxpayer identification numbers end with 1 or 6 (Cycle A plans) because they are the first to be restated for the Economic Growth and Tax Relief Reconciliation Act (EGTRRA). The changes must be incorporated into Cycle A plans and submitted to the IRS between February 1, 2006, and January 31, 2007." (McKay Hochman Co., Inc.)

President Signs Deposit Insurance Reform Bill
Excerpt: "This bill provides for legislative reforms to modernize the Federal deposit insurance system. Among other things, provisions in the modernization legislation would: ... Increase the deposit insurance limit for certain retirement accounts to $250,000, and indexes that limit to inflation; ...." (Wolters Kluwer Financial Services)

Text of Rev. Proc. 2005-66 -- Staggered Remedial Amendment Period Revenue Procedure (PDF)
31 pages. Excerpt: "Rev. Proc. 2005-66 describes the new remedial amendment cycles that apply to pre-approved and individually designed plans. The IRS is accepting applications for Cycle A individually designed plans beginning 02/01/06 and ending 1/31/07 (postmark date). The deadline for defined contribution pre-approved plan applications ended on 1/31/06. Information on the updated submission process is provided." (U.S. Internal Revenue Service)

Duke Energy Workers Sue Over Cash Balance Conversion
Excerpt: "Nine years after it converted its defined benefit pension plan to a cash balance arrangement, Duke Energy has been hit with a federal court lawsuit alleging violations of federal age discriminations laws." ( one-time registration required)

Links to Items on Executive Comp, Benefits in General

Retirement Perspective: Nonqualified Voluntary Deferred Compensation: Through an Executive's Eyes
Excerpt: "Employers are struggling to understand the implications of recent regulations and executives are asking if is still makes sense to defer income. This Perspective details the impact and implications of the changes for employers and executives." (Mercer Human Resource Consulting LLC and Mercer Investment Consulting, Inc.; one-time registration required)

Overview: SEC Proposes Comprehensive Disclosure of All Types of Executive Pay (PDF)
5 pages. Excerpt: "The SEC proposal is a comprehensive revision of the current disclosure rules that have been in effect since 1992. The rules are intended to provide greater transparency for investors and analysts about a public company's executive compensation. As the SEC Chairman says, the purpose of the new rules is to provide 'wage clarity, not wage controls.'" (Aon Consulting)

Overview: SEC Proposes New Disclosure and Other Rules for Executive Compensation (PDF)
7 pages. Excerpt: "For the first time in 14 years, the SEC has undertaken to significantly modify the executive compensation disclosure requirements in proxy statements, annual reports, and registration statements. In addition, the SEC's proposed rules add new requirements regarding related party transactions, corporate governance, and equity ownership among officers and directors." (Dechert LLP)

ERISA Litigation: Contingent Workers and Employee Benefits (PDF)
49 pages. Excerpt: "Companies that use the services of contingent workers ... need to understand the potential legal hazards that this type of arrangement may pose to their employee benefit plans." (The Bureau of National Affairs, Inc. via Janich Law Group)

Newly Posted Events
(Post Yours!)

Bankruptcy & Defined Pension Plans: Labor & Employment Issues
in New York on March 29, 2006
presented by New York City Bar Association

Employee Compensation On the Way In, On the Way Out, What's in the Package?
in New York on March 9, 2006
presented by New York City Bar Association

Web/Telephone Seminar: 403(b) Plans
Nationwide on March 23, 2006
presented by BISYS Retirement Services

Web/Telephone Seminar: Comparing Roth and Traditional IRAs
Nationwide on March 21, 2006
presented by BISYS Retirement Services

Web/Telephone Seminar: Conversions and Recharacterizations
Nationwide on March 14, 2006
presented by BISYS Retirement Services

Web/Telephone Seminar: Establishing IRAs and IRA Amendments
Nationwide on March 28, 2006
presented by BISYS Retirement Services

Web/Telephone Seminar: IRA Contributions
Nationwide on March 7, 2006
presented by BISYS Retirement Services

Web/Telephone Seminar: IRA Excess Contributions
Nationwide on March 16, 2006
presented by BISYS Retirement Services

Newly Posted Press Releases
(Post Yours!)

Giving Credit To Your HSA (Health Savings Account)
(DataPath, Inc.)

CareCounsel Adds Subimo's Health Management Tools to Healthcare Advocacy Program

Newkirk Launches Ground-Breaking Education Series Unique New Interactive Education Approach
(Newkirk Products Inc.)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Enrolled Actuary
for National Retirement Services, Inc.
in CA

Defined Contribution (3rd party Administrator)
for RSM McGladrey
in IL

ERISA Attorney
for Employee Benefits Institute of America Inc. (EBIA)
in WA

Team Leader, Large Case, Research & Development
for The Standard
in OR

Product Manager, Disability
for The Standard
in OR

Benefits Manager
for National Basketball Association
in NJ

Benefits Manager (Defined Benefit)
for GCC/IBT-SRDF (Chicago area)
in IL

External Wholesaler
for Transamerica
in PA

E.B. Trust Administrator
for BB&T (Branch Banking and Trust)
in NC

Client Services Senior Specialist
in DC

Dental Claims Auditor - (2 Positions)
for 1199SEIU Benefit and Pension Funds
in NY

401(k) Processor
for Leggette Actuaries, Inc.
in TX

Defined Contribution Pension Plan Administrator
for The Angell Pension Group, Inc.

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Copyright 2006, Inc.; except that you may reprint this newsletter in full (including this sentence) without obtaining our permission.

Published by:, Inc.
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Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151

Editor and Publisher: David Rhett Baker, J.D.