| BenefitsLink Retirement Plans Newsletter |   |
February 14, 2007
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IRS Clarifies Notice 2007-7 on Rollovers to Nonspouse Beneficiaries (Effect of Min. Distrib. Rules) (PDF)
2 pages; clears up an ambiguity that appears to have arisen due to the ordering of the Q&A's in Notice 2007-7. Excerpt: "The general rule of Q&A-19 was not intended to override the special rule in Q&A-17. . . . [Q&A-19] describes the general rule for determining required minimum distributions in the case of a nonspouse beneficiary rollover. . . . [Q&A-17] describes a special rule that is an exception to the general rule . . . . " (Internal Revenue Service)
Overview: Terms for Resolving 412(i) Audits (PDF)
Excerpt: "Through extensive dealings with the IRS in handling 412(i) plan audits, we have learned the outline for the resolution of these cases." (Reish Luftman Reicher & Cohen)
CPA Firm Required to Pay Restitution and Ensure Audit Training in ESOP Case
Excerpt: "The U.S. Department of Labor has obtained a consent judgment and order requiring the firm of Ahlstrom & Baker CPAs in Los Alamitos, California, to pay $5,000 in restitution to the employee stock ownership plan (ESOP) of Rehab Consultants of Florida Inc. (RCI) and ensure that all personnel conducting plan audits possess appropriate knowledge and continuing education training." (Health Plan Law blog by Attorney Roy F. Harmon III)
Alaskan Borough Balks at Pension Bills
Excerpt: "Officials from the Fairbanks North Star Borough are questioning the calculations used to determine the retirement payments that cities, school districts and other public employers make each year. In doing so, they are also wondering publicly whether employers can legally or ethically pay the high bills being sent by the state's retirement board." (Fairbanks Daily News-Miner)
Russell Pension Report 2007: The Current State of Corporate Pension Provision in America (PDF)
15 pages. Excerpt: "According to the recently released Russell Pension Report 2007, a report that offers insight into the current state of pension provision in America, corporate pension plans are more likely than ever to pursue unique objectives and asset allocation strategies." (Russell Investment Group)
Overview: IRS Revises Mortality Tables for 2007 Current Liability
Excerpt: "The IRS has released final regulations that provide mortality tables used to determine current liability for defined benefit pension plans. The regulations, which generally relate to the minimum funding requirements of Code Sec. 412 prior to enactment of the Pension Protection Act (PPA; P.L. 109-280), apply to plan years beginning on or after January 1, 2007." (Wolters Kluwer Law & Business)
New Mexico Governor Still Doesn't Like Lawmakers' Pension Boost
Excerpt: "Lawmakers are making another run this year at beefing up their pension benefits. But Gov. Bill Richardson has indicated he may veto it again." (AP via KOB-TV, LLC)
ERIC Files Amicus Brief with Supreme Court on Floor Offset Plans
Excerpt: "ERIC . . . filed an amicus brief with the Supreme Court in Xerox v. Miller on behalf of petitioner Xerox's request for certiorari. The case is being appealed by Xerox from a Ninth Circuit decision that invalidated the method used by Xerox for determining benefits in their floor offset plan." (The ERISA Industry Committee)
Pension Transferred to IRA Still Protected: Creditors Can't Claim Funds, Appellate Court Determines
Excerpt: "The ruling is the first by a California appellate court on the protection of pension funds from creditors once the funds are removed from a pension plan. Employees can make tax-free transfers of money from their pensions or other employer-supported accounts to their own tax-deferred IRAs." (San Francisco Chronicle)
IRA Rollover Provision Included in President's FY 2008 Budget
Excerpt: "President Bush's newly released budget for Fiscal Year 2008 includes a provision to make the IRA Rollover provision permanent, as well as several other charitable giving incentives." (Association of Fundraising Professionals)
Hewitt Global Retirement Update, February 2007 (PDF)
2 pages. Excerpt: "Our Global Retirement Update summarizes recent legislative developments and trends related to retirement and financial management and highlights recently passed and pending legislation that may require employers to take action to comply with new rules or review existing plans." (Hewitt Associates)
Overview: PBGC and DOL Provide Guidance to Defined Benefit Plans (PDF)
5 pages. Excerpt: "These developments affect sponsors of qualified defined benefit plans that are subject to PBGC premium and DOL disclosure requirements, including cash balance plans and multiemployer plans. Governmental plans and plans sponsored by churches that do not elect to be covered by ERISA ('nonelecting church plans') are not subject to these rules." (Prudential Retirement)
Overview: IRS Provides Guidance for Hybrid Plans (PDF)
5 pages. Excerpt: "These developments affect sponsors of and participants in hybrid plans, such as cash balance plans and pension equity plans. These developments also affect sponsors of qualified defined benefit pension plans that are considering converting their traditional defined benefit plan to a hybrid plan design." (Prudential Retirement)
Opinion: Desire for Big SS Personal Accounts Shouldn't Trump Concerns about Ballooning Costs
Excerpt: "I've been criticized, most recently by Larry Hunter in the New York Sun, for my January 25 article on National Review Online arguing that conservatives need to maintain a strategic perspective on the rising tax burdens that will follow from a failure to fix Social Security.: (Carrie Lukus via National Review Online)
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Links to Items on Executive Comp, Benefits in General
Overview: Stock Option Backdating: New Disclosure Guidance (PDF)
2 pages. Excerpt: "New guidance from the SEC staff should facilitate resolving option backdating errors. On January 16, 2007, Carol A. Stacey, Chief Accountant Division of Corporation Finance, posted a sample letter to CFOs providing guidance to companies on disclosing and filing such errors. The letter builds on the accounting guidance given by the SEC's Office of Chief Accountant in its September 19, 2006 release." (Porter, Wright, Morris & Arthur LLP)
A Review of Same-Sex Benefits for University Employees
Excerpt: "Since the spread of state amendments to bar g.ay marriage, a concern of many g.ay and les.bian college employees had been that the measures would be used to limit their employee benefits, and the Michigan ruling may be the most dramatic evidence yet that those fears reflect a real danger." (Inside Higher Ed)
Overview: IRS Revised Form 990 Instructions Regarding Compensation Paid by 'Related Organizations' (PDF)
2 pages. Excerpt: "Line 75c of Form 990 requires exempt organizations to report compensation paid to their directors, officers, highest-compensated employees and highest-compensated independent contractors (for ease of reference, 'Covered Individuals') by 'related organizations.'" (Drinker Biddle & Reath LLP)
Blame-the-Lawyer Stratagem Fails in ERISA Suit Against Fund Trustees
Excerpt: "A New Jersey federal judge's dismissal of legal malpractice and breach-of-fiduciary-duty claims against counsel in an ERISA case shows that trustees sued for misfeasance can't easily pass the buck to their lawyers." (New Jersey Law Journal via Law.com)
2006 Washington State Employee Benefits Survey (PDF)
27 pages. Excerpt: "Each year the Labor Market and Economic Analysis branch of the Employment Security Department surveys a large number of Washington employers about fringe benefits offered to employees. In the survey, employers are asked several detailed questions about medical insurance, retirement plans, and paid leave. The desired end result is to then provide job seekers, employers, and policy makers with reliable estimates for decision making." (Washington State Employment Security Department)
Ex-Pats Get Tax Guidance from IRS
Excerpt: "The Internal Revenue Service and U.S. Treasury have released guidance on the estimated tax penalty for citizens or residents of the United States living and working abroad." (PLANSPONSOR.com; free registration required)
Employee Benefit Offerings Can Improve Business Success
Excerpt: "Employers realize strong benefits can attract great talent and retain key employees, thus reducing turnover cost. Some even understand that benefits done right can improve the company's bottom line." (BenefitNews Connect)
Overview: Employment Tax Ramifications of Participating in IRS's Backdated Stock Options Initiative
Excerpt: "On February 8, 2007, the Internal Revenue Service (IRS) announced a new initiative . . . which permits employers to pay the 20% additional tax and interest on behalf of their employees in connection with the grant of certain backdated or discounted stock options (or other stock rights) which were exercised in 2006." (Littler Mendelson, P.C.)
Newly Posted Events
Employers' Key to Wellness Forum
in Michigan on February 22, 2007
presented by Detroit Regional Chamber
Participant Forms and Notices - 6 Cities Added
Nationwide on February 21, 2007
presented by SunGard Relius
Providing Investment Advice After the Pension Protection Act
in Pennsylvania on February 28, 2007
presented by ASPPA Benefits Council of Delaware Valley
Newly Posted Press Releases
Great-West Retirement Services® to Pilot RolloverSystems to Support Benefit Distribution Processing, Automated Rollovers
Great-West Retirement Services
New “International Pensions” Section Debuts On Pension Rights Center’s Web Site
Pension Rights Center
Workplace Options Reminds Employers of the Importance of Providing Support to Nursing Mothers
Workplace Options
CalSTRS Seeks Third Party Administrator for New Deferred Compensation Plan Services
California State Teachers' Retirement System (CalSTRS)
Executive Cash Compensation Rises 29% According to New ERI Economic Research Institute/CareerJournal.com Study
ERI Economic Research Institute
Employers' Key to Wellness Forum Feb. 22
Detroit Regional Chamber
Small Business Health Care Debate Moves Beyond AHPs; Kerry Leads Discussion of Comprehensive Health Care Reform to Ease Costs for Small Businesses
U.S. Senate Committee on Small Business and Entrepreneurship
Four Enemies to a Secure Retirement
Weiss Research, Inc.
Newly Posted or Renewed Job Openings
Benefit Calculation Developer
for Vanguard
in PA
Plan Consultant
for Diversified Investment Advisors
in NY
Defined Contribution Client Account Manager
for New York Life Investment Management - Retirement Plans Services
in MA
401(K) Professional
for Pentegra Retirement Services
in NY
Benefit Plan Administrator
for M Benefit Solutions
in OR
Inside Sales Consultant
for T Rowe Price
in MD
Shared Services Manager
for Regional Bank Holding Company
in KS, OK, TX
Sales Executive (Retirement Plans)
for BenefitStreet
in CA, KS
Plan Manager
for The Hartford
in CT
DC Implementation Business Analyst
for CitiStreet
in MA
Benefits Analyst
for Equity Risk Partners
in CA
Senior Defined Contributions Analyst
for Affiliated Computer Services/HRO Division
in MA
Health and Welfare Analyst
for Affiliated Computer Services/HRO Division
in NJ
Defined Contributions Specialist
for Affiliated Computer Services/HRO Division
in MA
Defined Contributions Analyst
for Affiliated Computer Services/HRO Division
in MA
Compliance Consultant
for MassMutual Financial Group
in MA
Pension Administrator
for Jim Hallinan Pension Consulting, LLC
in CT
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
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