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| April 23, 2008 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
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| SunGard's Document Management Services (DMS) |
| Rely on SunGard as your back office resource for EGTRRA restatements. If you have 500 or more retirement plan documents, turn to SunGard's expert DMS staff to cost-effectively create, amend and restate your plans. Outsource some or all of the processes you currently maintain in-house. Let us focus on your plan documents, so you can focus on growing your business.
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[Opinion] American Benefits Council Letter to Senate Regarding Fair Pay Restoration Act, S. 1843 (PDF)
2 pages. Excerpt: "I am writing on behalf of the American Benefits Council (the Council) to express concern regarding S. 1843, which would overrule the U.S. Supreme Court's decision in Ledbetter v. Goodyear Tire and Rubber Co. . . . The proposed legislation could raise serious retirement plan issues that we believe are unresolved in the current draft S. 1843. Under the bill, each payment of compensation or benefits that is lower as a result of past discrimination is deemed a new act of discrimination and thus an employee could file a charge or sue many years after the original action giving rise to the claim actually occurred." (American Benefits Council)
[Opinion] The Downside to 401(k) Loans (PDF)
Excerpt: "401(k) conventional wisdom is that loans are just a part of any well-rounded 401(k) plan. Because TRI-AD tends to be a leader rather than blindly following conventional wisdom, we are going to express the opinion that largely unfettered access to 401(k) accounts is counter to the plans' purpose of providing a way for participants to save successfully for retirement." (TRI-AD)
[Guidance Overview] Presentation on Common Prohibited Transactions for Portfolio Management and Trading (PDF)
34 pages. The presentation asks, and answers, Is the Broker-Dealer a Fiduciary – ERISA or Otherwise? What are ERISA Prohibited Transactions? Types of Exemption, and more. (Morgan, Lewis & Bockius LLP)
[Guidance Overview] Update on DOL Audit Profiling & Investigational Focus
Excerpt: "What does the EBSA investigate? Fiduciary Duty of Loyalty and Prudence (ERISA Section 404(a), 29 U.S.C. Section 1104(a) - Fiduciary duties - Prudent man standard of care) Prohibited Transactions: Certain transactions between the plan and parties-in-interest are prohibited absent an exemption (ERISA Section 406(a), 29 U.S.C. Section 1106(a) - Prohibited Transactions - Transactions between plan and party in interest) Conflicts of Interest (ERISA Section 406(b), 29 U.S.C. Section 1106(b) - Prohibited Transactions - Transactions between plan and fiduciary)" (Health Plan Law blog by Attorney Roy F. Harmon III)
[Guidance Overview] If an Individual Rolls Over Two IRA Distributions in a 12-Month Period, What Are the Consequences?
Excerpt: "An IRA owner is allowed to roll over just one distribution from the same IRA, or the same assets, in a 12-month period. According to the instructions for filing Form 5498, an IRA custodian/trustee should report (or correct any reporting already completed) any ineligible rollover contribution as a regular contribution. This required reporting serves to make the second (or third, etc.) distribution from a single IRA in a 12-month period, taxable." (Wolters Kluwer)
[Guidance Overview] Employee Plans Compliance Resolution System Update Expected 'Soon'
Excerpt: "An updated version of Rev. Proc. 2006-27 . . . will not be a major overhaul of the old procedure, . . . but will contain a number of smaller changes that taken together will have a significant effect on the program." (Wolters Kluwer)
Inmate Pension Quirk Unique to Hillsborough County, Florida
Excerpt: "Pension contributions were an unintended consequence of a Hillsborough County program, born in the 1970s, that hires inmates into undesirable county jobs, such as ditch digging and roadway cleaning. The program saved the county $533,000 in 2006, Public Works director Bob Gordon said. It could save even more if the county didn't have to treat the inmate workers as public employees potentially entitled to pensions." (St. Petersburg Times)
The Plan to Save Early Retirement - Economist Teresa Ghilarducci Argues We Needn't Be Chained to Our Desks Forever
Excerpt: "Teresa Ghilarducci isn't one for conventional wisdom. In her upcoming book, 'When I'm Sixty-Four: The Plot Against Pensions and the Plan to Save Them,' the New School University economist argues that a rich nation ought to be able to ensure a secure old age. And she has a radical proposal for making that happen." (Money Magazine via CNNMoney.com)
Retirement Plan Expert Says Use 401(k) Loan to Eliminate Credit Card Debt
Excerpt: "Consumers stung by the sudden doubling of their minimum required monthly credit card payments are finding new ways to eliminate credit card debt by replacing their card debt with cheaper alternatives such as 401(k) loans . . . ." (Neotrope®)
403(b) Investment Options - More Is Not Always Better
Excerpt: "When it comes to the size of a 403(b) plan's investment lineup, more isn't always better. That is particularly true now that 403(b) sponsors will be required to exercise the same due diligence about their investment options as their 401(k) cousins have always had to do, panelists said at an investment options discussion . . . ." (PLANSPONSOR.com; free registration required)
Macy's Fiduciary Breach Suit Will Stay in Ohio
Excerpt: "Macy's Inc.'s motion to move a fiduciary breach suit on behalf of a class of participants in its 401(k) plan has been denied by the U.S. District Court for the Southern District of Ohio." (PLANSPONSOR.com; free registration required)
Average Investor Lives Somewhere Between 'Ignorance Is Bliss' and 'Knowledge Is Power'
Excerpt: "[C]onsider two recent and very different studies of investors, one concerning knowledge and its ability to provide and create control, and the other about surrendering control, presumably due to a lack of knowledge. When juxtaposed, the two studies make for an intriguing landscape, giving investors food for thought about just what position they want to assume on the financial horizon." (MarketWatch)
[Official Guidance] IRS Issues Notice of May 29, 2008 Hearing on Proposed Regs About Determination of Assets and Liabilities for Single-Employer DB Plan Funding (PDF)
3 pages. Excerpt: "The public hearing is being held on May 29, 2008, at 10 a.m. The IRS must receive outlines of the topics to be discussed at the hearing by May 8, 2008." (Internal Revenue Service)
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Links to Items on Executive Comp, Benefits in General
[Official Guidance] Text of First Periodic Update to IRS 2007-2008 Priority Guidance Plan (PDF)
49 pages. Excerpt: "The attached update sets forth the guidance on the original 2007-2008 Priority Guidance Plan that we have published. Although the update may indicate that a particular item on the plan has been completed, it is possible that one or more additional projects may be completed in the plan year relating to that item. The update also includes 61 items of additional guidance, some of which have already been published.' See section entitled EMPLOYEE BENEFITS and section entitled EXECUTIVE COMPENSATION, HEALTH CARE AND OTHER BENEFITS, AND EMPLOYMENT TAXES. (Internal Revenue Service)
Survey Shows Middle East Companies Considering Employee Benefits
Excerpt: "Employee benefits such as pensions and medical, life and disability insurance are gaining more attention in the Middle East as the number of multinational companies and expatriate workers in the region increases, according to a Mercer survey." (Workforce Management; free registration required)
IRS Solicits 2008-2009 Guidance Priority List Recommendations
Excerpt: "In Notice 2008-47, the Department of Treasury and Internal Revenue Service invite public comment on recommendations for inclusion on the 2008-2009 Guidance Priority List. The list is used to identify and prioritize tax issues to be addressed, to focus resources on important tax admniistration items, to increase voluntary compliance and to clarify areas of tax law." (International Foundation of Employee Benefit Plans)
TIAA-CREF Endorses Legislation Calling for Domestic Partner Benefits
Excerpt: "TIAA-CREF today announced its support for H.R. 1820, Tax Equity for Health Plan Beneficiaries Act of 2007, introduced by Congressman Jim McDermott (D-WA) in the House and S. 1556, Tax Equity for Domestic Partner and Health Plan Beneficiaries Act of 2007, introduced by Senator Gordon Smith (R-OR) in the Senate." (Business Wire via PR-inside.com)
Benefit Trends: Change Is the New Constant
Excerpt: "To set the backdrop for the forces at work today in employee benefits, consider this statement by a president of one firm listed in the Dow Jones Industrial Average. In a recent PBS interview, he said, 'We no longer view ourselves as an American company; we act as a global company in all of our decision-making.' Executives of two other DJIA firms recently pointed out in presentations that 'less than half of our workforce is now in the United States -- but 95 percent of our health care costs are.'" (The Wall Street Journal)
Newly Posted Press Releases
Most Companies Oppose Single-Payer Health Care System, State Coverage Mandates
Watson Wyatt
Great-West Retirement Services® Joins With Ceridian To Ease 401(k) Administration For Small Businesses
Great-West Retirement Services
Tips To Help Protect Non-Traditional Families Facing Retirement Planning Hurdles
MassMutual
The Online 401k Adds 15 New Financial Advisor Partners
The Online 401(k)
CDM Retirement Consultants Renews Contract With CFFM
CDM Retirement Consultants, Inc.
Poster Compliance Center Advises U.S. Employers That Public Comment Period for Federal FMLA Has Ended
Poster Compliance Center
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