BenefitsLink |
 |
 |
| December 4, 2007 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
Today's sponsor is www.ftwilliam.com
(Click on company name or banner to learn more.)
| Need Form 5500 software? |
| Go to www. Ftwilliam.com and sign up for our free online demo to see how ftwilliam.com can make your life easier.
- All forms and schedules as well as SAR are included Contact sales@ftwilliam.com or call 800.596.0714 for more |
(a) New Guidance Documents
Text of PBGC Technical Update 07-3: Minimum Lump Sum Assumptions for Terminating Single-Employer Plans; Effect of Pension Protection Act of 2006
Excerpt: "This Technical Update 07-3 provides guidance on lump sum valuation issues for single-employer plans that terminate in a standard termination pursuant to ERISA section 4041, with a termination date prior to, and a final distribution date on or after, the effective date of changes in the interest rate and mortality table used in calculating minimum lump sum values under the Pension Protection Act of 2006 ('PPA 2006')." (Pension Benefit Guaranty Corporation)
(b) News
Fewer PBGC Retirees Getting Full Earned Benefits
Excerpt: "Eighty-four percent of the retirees who receive benefits from the federal pension insurance program receive the full benefit amount they earned under their retirement plans, according to the 2006 edition of the Pension Benefit Guaranty Corporation's Pension Insurance Data Book, which was released last week. In a 1999 study, the figure was 94 percent." (Occupational Health & Safety)
NTSAA Calls for Help in Developing 403(b) Data Standards
Excerpt: "The National Tax Sheltered Accounts Association (NTSAA) announced it is establishing a working group to devise data standards that will enable information about 403(b) plan transactions to be provided to plan sponsors and administrators, as necessitated by recent IRS regulations." (PLANSPONSOR.com; free registration required)
(c) Summaries of Guidance; Filed Comments
Overview of Defined Contribution Plan Sponsor Considerations for the New Year (PDF)
3 pages. Excerpt: "This issue of Fast Focus is a summary list of key provisions, both optional and mandatory, from the Pension Protection Act of 2006 (PPA) and other laws affecting defined contribution plans. Plan sponsors need to consider how the mandatory provisions affect their current plan design, and whether to make changes necessary to take advantage of the optional provisions." (Chang Ruthenberg and Long PC)
American Benefits Council Comment Letter to IRS on Benefit Restrictions (PDF)
6 pages. Excerpt: "We strongly urge Treasury and the Internal Revenue Service (the 'Service') to issue guidance very promptly stating that, until plan years beginning at least six months after finalization of these regulations, good faith compliance with a reasonable interpretation of either the statute or the Proposed Regulations will constitute compliance with the benefit restriction rules." (American Benefits Council)
Notice 2007-94 Provisions on Guidance Cutoffs Mean Cycle C Plan Document Revisions Can Be Completed and Ready in February 2008
Excerpt: "The 2007 Cumulative List states that, when reviewing Cycle C plans, the IRS will not consider guidance issued after October 1, 2007. . . . This means my Cycle C plan documents can be completed and ready in February, at the beginning of Cycle C, because this year [unlike the rules for Cycle B plans in 2006] there is no further guidance to wait for." (Pension Protection Act Blog)
Overview: SEC Proposes New 'Layered' Prospectus Disclosure and Delivery (PDF)
5 pages. Excerpt: "In announcing these proposed changes, the SEC stated that its objective was to move toward a 'layered' disclosure regime, whereby certain key information would be easily available to all investors in a standardized format to facilitate comparisons among funds and to employ the Internet to provide more detailed information to investors." (Paul, Hastings, Janofsky & Walker LLP)
Does Your Qualified Retirement Plan Need to Be Amended This Month? (PDF)
4 pages. Excerpt: "Recent IRS guidance has reminded plan sponsors of deadlines for amending qualified retirement plans. Some amendments must be completed by December 31, 2007 (for calendar-year plans). Others must be completed by January 31, 2008 (for Cycle B plans). Still others must be completed by the deadline for filing the plan sponsor's 2007 tax return ('interim' amendments). This advisory identifies those plans that must be amended now or in the near future." (Alston & Bird LLP)
(d) Trends, Surveys, Research
LaRue Case Should Worry Plan Sponsors
Excerpt: "The Supreme Court's consideration of LaRue v. DeWolff this past Monday is likely to send shivers down the spines of retirement plan sponsors from coast to coast. At issue is whether an individual can sue to recover investment losses resulting from an administrative mistake and whether plans would have to pay real money to correct such mistakes." (Employee Benefit Advisor; free registration required)
Redrawing the Route to Retirement with the New 'Super 401(k)'
Excerpt: "[The] new super 401(k) is at the cutting edge of a trend that's reshaping retirement benefits. Traditionally, employees have wielded decision-making authority over their own 401(k)s, by electing whether and how to invest. But as a growing number of employers have scaled back or eliminated defined-benefit pension plans, government and corporate policymakers have realized 401(k) participants haven't done a very good job of managing their savings. Emboldened by recent legal and regulatory changes that shield employers from lawsuits, more are starting to make changes to 401(k) plans with the goal of taking the decision-making out of employees' hands." (BusinessWeek)
Employee Ownership Update for December 3
NCEO Executive Director Corey Rosen discusses a Supreme Court case on the standing of individual plan participants to sue; the DOL's elimination of the Form 5500 Schedule E filing requirement for ESOP companies; falling retirement plan participation; and Winston Churchill on employee ownership. (National Center for Employee Ownership)
Some Effects of the New 403(b) Rules
Excerpt: "The new 403(b) regulations -- which take effect January 1, 2009, and make 403(b)s work much like 401(k)s -- will provide opportunities for advisors, plan sponsors, and participants . . . ." (Investment Advisor)
Pension Fund Litigation Could Slow Investments
Excerpt: "Litigation against pension sponsors and managers is skyrocketing, and some think it may be only the tip of the iceberg. Such is the momentum that the president of Pension Governance LLC, Susan Mangiero, this week is launching pensionlitigationdata.com, a Web site that will contain information on the 1,500 lawsuits currently pending against those managing and overseeing pension plans." (The New York Sun)
Congressional Pensions Explained
Excerpt: "Here are the basics: Members of Congress (House and Senate) take part in a defined benefit plan (once retired, they receive a specific monthly benefit based on years of service). They do not retire at full pay and their pension is a contributory plan -- that is, they have a significant amount deducted from their salary each month to help defray the cost of their pension benefits. This defined benefit plan is comparable to pensions offered by big companies like General Motors except that in some instances the companies underwrite the entire cost of the plan." (FoxNews.com)
Lawmakers Push Pension Clout for `Terror Free' Market
Excerpt: "Legislators from four different states have written the governors of the 50 U.S. states and 277 leaders of all the state legislatures suggesting divestment from companies doing business in Syria, Iran, North Korea and Sudan." (Bloomberg News)
PPA Permits Advisers to Help Retirement Plans in Different Ways
Excerpt: "Investment advisers can thank the 2006 Pension Protection Act for giving them a new opportunity. Advisers can now create business models aimed at the $17 trillion that baby boomers will manage over the next two decades as they work toward retirement." (Investment News; free registration required)
South Miami Files Claim Against Merrill Lynch
Excerpt: "Merrill Lynch, accused of conflicts of interests in its role as consultant to government pension plans, is the subject of an arbitration claim brought this week by South Miami. Rather than looking out for the interests of city employees, Merrill Lynch pursued an investment strategy intended to generate excessive fees and commissions for itself, the board of trustees for South Miami's pension plan claims. The plan seeks more than $1.5 million in damages from Merrill Lynch." (The Miami Herald via Human Resource Executive Online; free registration required)
PA County Official Vows More Court Action over Troubled Pension Fund
Excerpt: "A group of employees and retirees of Luzerne County (PA) have vowed to sue to recoup the more than $3 million in legal fees spent to prosecute an unsuccessful civil racketeering case over earlier pension plan losses." (PLANSPONSOR.com; free registration required)
Alternative Investments Not So 'Alternative' Anymore
Excerpt: "Results of a recent survey by Russell Investments indicate alternative investments -- hedge funds, private equity, and real estate -- are becoming more mainstream for pension funds, foundations, and endowments around the world." (PLANSPONSOR.com; free registration required)
U.S. Financial Jitters Lead to Retirement Savings Reductions by Participants
Excerpt: "Just over one in 10 American workers (11%) said they plan to cut back their retirement plan contribution rate as part of a general belt-tightening during the holiday season." (PLANSPONSOR.com; free registration required)
The Case for Life Cycle Investing
Excerpt: "With the growing interest in life cycle investing, it's sometimes hard to forget that practitioners and theoreticians recently argued exactly the opposite: that equity exposure should be constant, and not declining, over the investor's life cycle. Among practitioners, for example, Benjamin Graham's default allocation for high-net-worth investors was half equities and half fixed income, independent of age." (On Wall Street)
(e) Policy, Opinion, Advocacy
Book Review: Fighting the Good Fight on 401(k)s
Excerpt: "David Loeper's MISSION is to keep 401(k) plan participants from getting ripped off. In his new book, Stop the 401(k) Rip Off, (Bridgeway Books, 2007), Loeper rails against the hidden fees in 401(k) plans and attempts to arm participants with the ability to uncover the fees and approach their employer about offering less expensive funds in their plans." (Investment Advisor)
Sponsored by: ASC & the ASC Institute
(Click on company name or banner to learn more.)
| Easily and quickly prepare your 2008 notices, including safe harbor and automatic enrollment notices! |
| DGEM is ready to generate your EGTRRA plan documents as well as your 2008 notices TODAY!
The response to our recent demonstrations of ASCi's Document Generation & Management (DGEM) system has been overwhelmingly positive. Document providers are jumping at the opportunity to save time and money by using this state of the art Internet based document system. Don't miss your opportunity! Click above to see for yourself why so many people are making the switch to the ASCi DGEM system. |
| (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) |
Links to Items on Executive Comp, Benefits in General
Text of IRS Notice Allowing Correction of Certain 409A Operational Failures, and Proposed Ongoing Corrections Program (PDF)
Excerpt: "This transition relief and additional guidance includes: (1) Methods for correcting certain operational failures during the taxable year of the service provider in which the failure occurs to avoid income inclusion under § 409A(a). (2) Transition relief limiting the amount includible in income under § 409A(a) for certain operational failures occurring in a service provider's taxable year beginning before January 1, 2010, that involve only limited amounts. (3) An outline of, and request for comments on, a potential corrections program that would permit service recipients and service providers to limit the amounts required to be included in income under § 409A(a) due to certain operational failures." (Internal Revenue Service)
Feds Unveil Potential 409A Compliance Relief
Excerpt: "Federal officials on Monday issued additional guidance on how section 409A nonqualified deferred compensation programs can fix certain types of plan problems." (PLANSPONSOR.com; free registration required)
Overview of Section 409A Corrections Program per IRS Notice 2007-100
Excerpt: "Corrections relief is provided to plans that make unintentional errors, such as mistakenly paying out deferred compensation earlier than required by a plan. Plans that correct under this guidance within the service recipient's tax year can avoid adverse tax consequences. Plans that do not qualify for such relief, but nevertheless correct before January 1, 2010, can avoid some of the adverse consequences of plan failure." (CCH Tax Newsletter)
Overview: IRS Guidance on Reporting and Withholding Nonqualified Deferred Compensation Plan Deferrals
Excerpt: "In what is becoming an annual ritual, the IRS delayed the requirement for companies to report nonqualified deferred compensation (NQDC) plan deferrals on Forms W-2 and 1099 for another year (see Watson Wyatt Insider, January 2007). Notice 2007-86 waives reporting requirements for calendar year 2007 for annual deferrals of compensation under section 409A (Form W-2, Box 12, Code Y and Form 1099, Box 15a)." (Watson Wyatt Worldwide)
Towers Perrin U.S. Legislative Tracking Charts -- Human Resources -- Updated November 28, 2007 (PDF)
12 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)
Tougher COLI Restrictions Explored by Congress
Excerpt: "Corporate-owned life insurance would face new restrictions under a bill sitting in a House subcommittee. HR 150 would prevent companies from taking out life insurance policies on employees, regardless of income, without telling them." (Investment News; free registration required)
IRS Notice 2007-99: Eligible Distributions from Governmental Plans for Payment of Healthcare Premiums Now Tax-Free When Paid to Self-Insured Plans (PDF)
Revises certain IRS rules implementing a PPA provision, to reflect Congressional intent; tax-free treatment formerly applied only to payment for healthcare premiums to 'insured' plans. Excerpt: "Notice 2007-7, Q&A-23, is modified as follows: Q-23. Can the accident or health plan receiving the payments of qualified health insurance premiums be a self-insured plan? A-23. Yes. An accident or health plan, which is defined under § 105(e), includes a self-insured plan. See § 1.105-5(a) of the Income Tax Regulations." (Internal Revenue Service)
Newly Posted Events
New Rules for the New Year
in Ohio on December 12, 2007
presented by ASPPA Benefits Council of Cleveland
Newly Posted Press Releases
Watson Wyatt Study Reveals Six Communication "Secrets" Of Top-Performing Employers
Watson Wyatt
PPA'06 Defined Benefit Administration Software from DATAIR
DATAIR Employee Benefit Systems, Inc.
Treasury, IRS Issue Notice Allowing 409A Corrections
U.S. Treasury Department and Internal Revenue Service
Prudential Retirement Captures Platinum Best-In-Class Award For Plan Sponsor Communications
Prudential Financial, Inc.
NTSAA Announces Plan to Establish Data Standards to Enable Compliance with New 403(b) Regulations
National Tax Sheltered Accounts Association
ING Employee Benefits Announces New Critical Illness Insurance Product
ING Group
HSA Bank Announces New Investment Options
HSA Bank
Newly Posted or Renewed Job Openings
(Post a Job | View All Jobs |
RSS Feed )
Employee Benefits Attorney
for Hershner Hunter, LLP
in OR
Enroller - Employee Benefits Meeting Presenter
for Total Benefit Communications
in ANY STATE
401(k) Plan Administrator
for Pollard & Associates, Inc.
in MD
Assistant 401(k) Administrator
for Pollard & Associates, Inc.
in MD
Retirement Plans Analyst
for AutoNation, Inc.
in FL
Pension Administrator
for Alliance Pension Consultants
in IL
Director Health & Welfare
for Buck Consultants
in OH
401(k) Plan Administrator
for Work for a big city with a small town attitude!
in TX
Junior Account Manager
for WHA Financial Solutions
in WI
Legislative Counsel
for Pension Rights Center
in DC
Plan Consultant Opportunity
for Weaver Partners, Inc.
in ANY STATE
Daily Valuation/Recordkeeping Manager
for Pension Specialists, Inc.
in CA
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
Subscribe to the BenefitsLink Health & Welfare Plans Newsletter, Too!
Sign-up form is at https://benefitslink.com/newsletter (free).
This newsletter is sent to you each workday except federal holidays.
This email has been published by:
BenefitsLink.com, Inc.
1298 Minnesota Avenue, Suite H
Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151
David Rhett Baker, J.D., Editor
Copyright 2007 BenefitsLink.com, Inc.; except that you can forward this email in full (including this boilerplate part) or otherwise reprint this email in full (including this boilerplate part) without obtaining our permission.
Anyone can receive these emails; just have them sign up at this web page: https://benefitslink.com/newsletter/
Other useful links: