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| December 12, 2007 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
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(a) New Guidance Documents
(None today.)
(b) News
House Bill Extends Pilots' Retirement Age
Excerpt: "The House voted unanimously Tuesday to extend the retirement age for commercial pilots to 65, changing a 1960 Federal Aviation Administration regulation forcing pilots to leave the cockpit at age 60." (The Washington Post; free registration required)
Eliminate 401(k) Waiting Periods, Say Congressmen
Excerpt: "Congress should seriously consider changing retirement savings plan law to eliminate waiting periods so employees can enroll immediately in 401(k) and other defined contribution plans, two lawmakers said . . . ." (Business Insurance)
(c) Summaries of Guidance; Filed Comments
Overview: IRS Provides Model Language for 403(b) Plans
Excerpt: "The IRS has issued model plan language for use by public school employers in adopting or amending a 403(b) plan, which reflects the final 403(b) regulations issued on July 26, 2007 . . . ." (Wolters Kluwer Financial Services)
Overview: PBGC Announces Flat-Rate Premium for 2008 Payment Years
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) has announced the Single-Employer Program's inflation adjusted flat-rate premium will be $33.00 per participant in 2008, up from $31 this year." (Deloitte via BenefitsLink.com)
(d) Trends, Surveys, Research
Fiduciary Focus: The 12 Days of Christmas of a Modern Prudent Fiduciary
Excerpt: "On the first day of Christmas my true love said to me: According to Nobel laureate Harry Markowitz, the father of modern portfolio theory, the fundamental problem faced by all investors (including fiduciaries that are responsible for other people's money) is that any investment decisions they arrive at are made under conditions of uncertainty." (Morningstar)
Small Employers and SEP-IRAs Can Be a Good Match
Excerpt: "SEP-IRAs deliver retirement benefits without the higher cost and administrative burden of 401(k)s. Employers contribute to them on behalf of workers once per year, based on the performance of the company. There is no set contribution rate, unlike the standard practice of employee payroll deductions and guaranteed company matches in 401k(s). SEP-IRAs are most commonly used by small businesses owners, such as consultants, realtors, psychologists, IT contractors or physician groups." (Employee Benefit News; free registration required)
(e) Policy, Opinion, Advocacy
Private Pensions: Low Defined Contribution Plan Savings May Pose Challenges to Retirement Security, Especially for Many Low-Income Workers (PDF)
65 pages. Excerpt: "This report addresses the following issues: (1) What percentage of workers participate in DC plans, and how much have they saved in them? (2) How much are workers likely to have saved in DC plans over their careers and to what degree do key individual decisions and plan features affect plan saving? (3) What options have been recently proposed to increase DC plan coverage, participation, and savings?" (U.S. Government Accountability Office)
Opinion: The Long Overdue Florida Public Pension Clean-Up
Excerpt: "[We at Benchmark Financial Services] estimate that approximately $1 billion has been lost by Florida public pensions as a result of broker- consultant schemes. Tragically Florida taxpayers have had to contribute more to fund these underperforming retirement plans for state workers. Florida public pensions have suffered for decades as their broker-consultants profited." (Benchmark Financial Services, Inc.)
Financial Illiteracy -- A National Priority
Excerpt: "Too many Americans are insufficiently educated about money. All aspects of money -- credit, interest, savings, investing, taxes. You need look no further than the front page of the newspaper for evidence that over-their-head homebuyers didn't understand the exotic mortgages on which they're now defaulting. . . . The problem is so dire, in fact, that Congress deemed April 'Financial Literacy Month.'" (The Motley Fool)
Overview: SEC Proposes New Summary Prospectus for Mutual Funds to Help 401(k) Participants and Other Investors Compare Funds
Excerpt: "SEC identified numerous specific areas in proposed amendments where it seeks comments from the public and, in particular, from investors. If the proposed amendments are adopted, all initial registration statements on Form N-1A and all post-effective amendments that are annual updates to effective registration statements on Form N-1A which are filed 6 or more months after the effective date will be expected to comply." (Deloitte via BenefitsLink.com)
Links to Items on Executive Comp, Benefits in General
Overview: New Incentive Stock Option and Employee Stock Purchase Plan Filing Requirements (PDF)
3 pages. Excerpt: "Under new filing requirements, employers are required to furnish information returns to the Internal Revenue Service (IRS) regarding the exercise of incentive stock options (ISOs) and the transfer of shares acquired under an Employee Stock Purchase Plan (ESPP) that occur on or after January 1, 2007. The IRS has not yet provided guidance as to the exact information required, the format in which the required information is to be provided, or the due date of the information returns. Unless the IRS decides to postpone the effective date, we anticipate that the deadline for filing the returns will be February 28, 2008." (Morgan, Lewis & Bockius LLP)
How Does the New Legislation Allowing a One-Time Transfer from an Existing IRA Affect an HSA?
Excerpt: "This one-time (once in a lifetime) provision allows an individual to use his/her IRA to make a regular contribution, including a catch-up contribution, to his/her own HSA." (Wolters Kluwer Financial Services)
Overview: IRS Limited Correction Program Under Code Section 409A (PDF)
4 pages. Excerpt: "If the requirements of the Notice are met: Certain operational failures that are corrected during the year the failure occurs will not result in section 409A violations. Certain operational failures that occur in years before 2010 and involve only limited amounts (e.g., $15,500 or less in 2007/2008) may be corrected within two years. Only the amounts involved in such a failure will be subject to adverse treatment under section 409A." (Groom Law Group)
Employer Costs for Employee Compensation, September 2007 (PDF)
Excerpt: "Employer costs for employee compensation for civilian workers averaged $28.03 per hour worked in September 2007, the U.S. Department of Labor's Bureau of Labor Statistics reported today. Wages and salaries, which averaged $19.56, accounted for 69.8 percent of these costs, while benefits, which averaged $8.47, accounted for the remaining 30.2 percent." (U.S. Bureau of Labor Statistics)
Watson Wyatt's 2007/2008 Report on Executive Pay -- Debunking Executive Compensation Myths (PDF)
16 pages. Excerpt: "[The study] demonstrates the overall effectiveness of the U.S. executive pay model by finding that CEOs' realizable pay and corporate performance are highly correlated. It also confirms that executive stock ownership and stock options create strong alignment with shareholder interests and provide powerful incentives to maximize shareholder value." (Watson Wyatt Worldwide)
Overview: IRS Reverses Previous Ruling on Exclusion for Governmental Pension Distributions Used to Pay Public Safety Officers' Retiree Medical Premiums to Self-Insured Plans
Excerpt: "Citing pending technical changes to the Pension Protection Act and special considerations involving eligible retired public safety officers, IRS reversed its position on whether payments to a self-insured accident or health plan would qualify for the exclusion from income provided under Code Section 402(l) as added by the Pension Protection Act." (Deloitte via BenefitsLink.com)
Overview: IRS Limited Relief for Certain Section 409A Operational Failures
Excerpt: "[W]hile Notice 2007-100 may be helpful to some taxpayers under limited circumstances during the transition period, its greater significance is as a first step toward a post-transition-relief corrections program." (Deloitte via BenefitsLink.com)
Newly Posted Events
IRS Issues 403(b) Guidance
Nationwide on December 13, 2007
presented by Convergent Retirement Plan Solutions, LLC
Newly Posted Press Releases
Hewitt Survey Reveals Dwindling Popularity of the Annual Holiday Bonus
Hewitt Associates LLC
ExpertPlan Named One of New Jersey's 50 Fastest Growing Companies by NJBIZ Magazine
ExpertPlan
U.S. Department of Labor Obtains Court Order Restoring Assets To Huntersville, North Carolina-based Trucking Company's Profit-sharing Plan
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
RolloverSystems to Provide Rollover Support and Services to DailyAccess Retirement Plan Clients
DailyAccess Corporation
Navellier Funds Added to CPI Retirement Platform
CPI Qualified Plan Consultants, Inc.
National Business Coalition on Health Releases 2008 eValue8(tm) RFI
National Business Coalition on Health
More Than Half Of Americans Say They Are Not Saving Adequately
Wachovia Corporation
Today's Young Workers Expected to Reach Retirement Age with Little 401(k) Savings
U.S. House Education and Labor Committee
Newly Posted or Renewed Job Openings
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401(k) Client Relationship Manager
for The Douglas Group
in CA, NJ, PA
Defined Contribution/401(k) Administrator
for Boyce & Associates, Inc.
in AZ
Senior Relationship Manager -- Client Services
for Boyce & Associates, Inc.
in AZ
Signing Bonus / Senior DC Plan Administrator
for Berlin, Ramos & Company
in MD
Pension Administrator
for Silverhawk Retirement Services
in AZ
WRS Relationship Manager II
for Wachovia Corporation
in PA
Supervisor, Operations
for The Newport Group
in WI
401(k) Plan Administrator
for Beyer Barber Company
in PA
Pension Administrator
for Means & Associates, LLC
in CA
Implementation Specialist
for The Newport Group
in FL
401(k) Administrator
for Continental Benefits Group, Inc.
in NJ
Defined Contribution Plan Administrator
for Benefit Consulting Group Inc
in NY
Asset Transfer Administrator
for Vanguard
in PA
Handy Links:
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- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
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