Retirement Plans
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November 10, 2006
Today's sponsor: Employee Benefits Institute of America Inc. (EBIA)

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EBIA's 401(k) Plans Manuals and Seminars!

A must-have resource for employers, administrators, and advisors, our 401(k) Plans manual explains the Internal Revenue Code and ERISA requirements for 401(k) plans, and it explores all sorts of plan design and administration issues. Subscribers love the depth of our legal analysis and our practical, real-world tips. Topics include eligibility, vesting, contributions, distributions, plan loans, hardship withdrawals, discrimination testing, fiduciary duties, plan investments, plan corrections, and much more.

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Text of Vanguard's Annual Survey of Defined Contribution Plan Data (PDF)
72 pages, entitled How America Saves 2006: A Report on Vanguard 2005 Defined Contribution Plan Data. Excerpt: "In this annual publication, we update our analysis of defined contribution plans and participant behavior . . . ." (Vanguard Center for Retirement Research)

Deadline Approaching for Participant Diversification Requirements
Excerpt: "[D]efined contribution plans that offer publicly traded employer stock as an investment option must now satisfy new diversification requirements. In order to inform participants of their diversification rights, ERISA requires that participants receive a written notice of their right to divest employer stock. For calendar year plans, the new participant notice must be distributed by December 1, 2006, and the new diversification rights must be offered effective as of January 1, 2007." (Buchanan Ingersoll & Rooney PC)

Overview: Tax Free Distributions from IRAs to Charities (PDF)
4 pages. Excerpt: "The Pension Protection Act of 2006 contains a provision that allows certain owners of traditional IRAs and Roth IRAs to exclude 'qualified charitable distributions' of up to $100,000 a year from their gross income. . . . The exclusion is available only for qualified charitable distributions made in 2006 and 2007." (Dean Mead)

Mexico City Approves G.ay Civil Unions; Pensions Affected
Excerpt: "The bill . . . allows same-sex couples to register their union with civil authorities, granting them inheritance and pension rights, as well as other social benefits." (AP via New York Times; one-time registration required)

401(k) Fees Can Chomp a Hole in Your Savings
Excerpt: "Retirement-plan fees have drawn more attention in recent years as the oldest of 79 million baby boomers get set to retire. Now, this scrutiny is reaching a critical mass. The Labor Department is considering requiring companies to disclose more information about retirement plan fees. Meanwhile, individual lawsuits, filed this year against companies including Lockheed Martin and Boeing, allege that employees were overcharged in their 401(k) plans." (USA Today)

Overview: EBSA Expands Class Exemption For Securities Lending By Employee Benefit Plans
Excerpt: "To further protect plans from any unnecessary costs and risks associated with the lending of securities in the different foreign jurisdictions, the final amendment imposes a new condition that requires the lending fiduciary to be a U.S. bank or U.S. broker-dealer that indemnifies the plan with respect to the difference, if any, between the replacement cost of the borrowed securities and the market value of the collateral on the date of a borrower default." (CCH Pension and Benefits)

Overview: PPA Increases ERISA Plans' Ability to Invest in Private Investment Vehicles
Excerpt: "Prior to the Act, not to be treated as managing plan assets, a private investment fund, whether in the form of a partnership, corporation or trust, had to have less than 25% of each class of its equity interests held by benefit plan investors. . . . [T]he fund manager would become subject to the complex fiduciary duty rules and prohibited transaction provisions of ERISA (and the prohibited transaction provisions of Section 4975 of the Code)." (BNA Tax Management)

Former Univ. Massachusetts President Wins Pension Increase; Definition of Compensation at Issue
Excerpt: "A former University of Massachusetts president will get a $17,000 annual pension increase after the state's highest court agreed Thursday that his housing allowance should be counted as compensation. . . . The attorney general's office [had appealed a lower court ruling against the state of Massachusetts], saying the payments were 'perks' and would set a dangerous precedent for the public pension system if they were included when setting pension payments." (AP via New York Times; one-time registration required)

Working Paper: Retirement Savings Portfolio Management
Excerpt: "We find that if investors use simple rules of thumb to choose investments, then the impact of these strategies on welfare depend to a large extent on the choice set they are offered. If larger choice sets cause them to undertake more risk, then risk tolerant individuals may tend to be made better off. If larger choice sets cause them to reduce suboptimally low levels of portfolio risk, then the increased choice set may make them substantially worse off." (University of Michigan Retirement Research Center)

Links to Items on Executive Comp, Benefits in General

Social Security and 50+ Workers: A Survey of AARP Florida Members
Excerpt: "Over half of AARP Florida members are retired and not looking for work, but nearly a third are still working. Focusing on the importance of economic security and health care as motivating factors, this mail survey of 1,089 Florida members explores why those who choose remain in the workforce do so." (AARP)

Overview: Executive Compensation and Related Person Disclosure (PDF)
7 pages. In question & answer format; a summary of changes to SEC Form 8-K regarding executive compensation that became effective on November 7, 2006. (Sutherland Asbill & Brennan LLP)

Newly Posted Events
(Post Yours!)

Documented Confusion: Restatements and Interim Amendments
Nationwide on December 12, 2006
presented by SunGard Corbel

Form 1099-R: Brave New World after Roth
Nationwide on December 5, 2006
presented by SunGard Corbel

Making the Web Work for You: Employee Benefits Greatest Hits
in Ohio on November 30, 2006
presented by WEB (Worldwide Employee Benefits Network) Cleveland Chapter

Newly Posted Press Releases
(Post Yours!)

IRS Provides Guidance on Per Diem Expense Reimbursements Paid By Employers
(Internal Revenue Service (IRS))

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

ERISA Compliance Specialist
for Associated Benefit Planners, Ltd.
in PA

Senior Legal Counsel (ERISA)
for Eastman Kodak Company
in NY

Health & Welfare Service Delivery Manager
for Constantin Control Associates
in NJ

Retirement Services Client Relations Manager
for Gallagher Retirement Services
in TX

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