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July 18, 2008

Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy.

Today's sponsor is ASPPA

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ASPPA Annual Conference

How do the elections this fall affect you as a pension professional?
Attend the ASPPA Annual Conference in Washington, DC October 19-22 and find out. Network with over 1600 pension professionals, attend more than 60 interactive workshops and hear the latest election talk from our Keynote Speakers James Carville and Mary Matalin. Don't wait, register now and be a part of it all with ASPPA.

[Guidance Overview] Assessing the Implications for U.S. Plans of the IASB's Preliminary Views on Changes to IAS 19 (PDF)
4 pages. Excerpt: "Measurement of the obligation and annual cost for the majority (perhaps two-thirds or more) of U.S. pension and many retiree welfare plans would change under the [International Accounting Standards Board's] preliminary views." (Towers Perrin)

[Guidance Overview] List of Required Amendments for DC and DB Plans Since the Gust Restatement, Revised 7/8/2008 (PDF)
4 pages. (Datair Employee Benefit Systems, Inc.)

[Guidance Overview] Hewitt's Global Retirement Update, July 2008 (PDF)
3 pages. (Hewitt Associates)

[Guidance Overview] Taxpayer Required to Include SEP Distribution in Gross Income, According to Tax Court
Excerpt: "A taxpayer was required to include in his gross income a $25,000 distribution from his individual retirement account-based simplified employee pension (SEP) that the taxpayer failed to roll over to another IRA. In addition, the taxpayer was liable for the IRC Sec. 72(t) 10% additional tax on premature distributions. These were the conclusions of the U.S. Tax Court in Atkin v. Commissioner (Docket No. 5266-05. T.C. Memo. 2008-93)." (Wolters Kluwer)

[Guidance Overview] 'Why Do Spouses Have to Be the Automatic Beneficiary of a Retirement Plan?'
Excerpt: "[The Retirement Equity Act of 1984] amended Title I of ERISA to require written consent of both the employee and his or her spouse to waive the survivors' annuity option in a defined benefit plan. Under certain conditions, this rule also applies to defined contribution plans." (National Benefits Services, Inc.)

[Guidance Overview] Updating Your ERISA Retirement Plan for Section 415 Changes
Excerpt: "With certain exceptions, the final regulations are applicable to limitation years beginning on or after July 1, 2007. For most plans, this means that the final regulations took effect as of January 1, 2008. Generally, plans are required to be amended to comply with the Section 415 final regulations. The plan amendments must be made by the employer's deadline for filing its income tax return (including extensions) for tax year 2008 (sometime in 2009)." (Aiken and Aiken)

[Guidance Overview] IRS May Not Exercise Participant's Early Distribution Election to Collect on Levy
Excerpt: "IRS Office of Chief Counsel issued an Advice Memorandum concluding that the Service is not entitled to exercise a taxpayer's right to suspend membership in a state retirement fund in order to obtain immediate distribution where the taxpayer has not reached retirement age. Office of Chief Counsel, Internal Revenue Service, Memorandum No. 200819001, Released May 9, 2008." (Deloitte via

[Guidance Overview] Use of Plan Assets to Promote Collective Bargaining Objectives Violates ERISA
Excerpt: "According to U.S. Chamber President and CEO, Thomas J. Donohue, unions are becoming increasingly aggressive in using plan assets 'as a financial battering ram' in organizing campaigns and contract negotiations. The Department of Labor's Advisory Opinion makes clear that ERISA does not allow the interests of the plan participants to be subordinated to such objectives." (Employee Benefits Institute of America)

States Eye Cycle of Retiring, Rehiring
Excerpt: "The practice -- called 'double dipping' -- lets tens of thousands of state and local workers retire, collect pension benefits and then keep working, often at the same job. . . . Double-dipping is legal in nearly every state under existing pension and hiring rules. It is especially common among educators, police officers and others who retire young after 20 to 30 years on the job." (USA TODAY)

PBGC's 2007 Annual Report (PDF)
76 pages. Excerpt: "The size of PBGC's deficit is an important consideration, but that number is just a snapshot that can change at any moment with movements in interest rates or asset values. The more important consideration is whether the Corporation has a realistic plan to meet its long-term obligations." (Pension Benefit Guaranty Corporation)

Hearing: Your Money, Your Future: Public Pension Plans and the Need to Strengthen Retirement Security and Economic Growth
Excerpt: "U.S. Senator Robert P. Casey (D-PA) convened a hearing of the Joint Economic Committee (JEC) to examine the public and private sector impacts of defined benefit pension plans in the public sector. The hearing entitled, 'Your Money, Your Future: Public Pension Plans and the Need to Strengthen Retirement Security and Economic Growth' was held Thursday, July 10 at 10:00am in Room 106 of the Dirksen Senate Office Building. The panel of experts discussed the recent changeover from defined benefits to defined contributions plans and its effect on employees' retirement income and the U.S. economy." (U.S. Congress Joint Economic Committee)

Text of the 401(k) Plan Debit Card Bill (PDF)
4 pages. Excerpt: "To amend the Internal Revenue Code of 1986 to provide that no loan may be made from a qualified employer plan using a credit card or other intermediary and to limit the number of loans that may be made from a qualified employer plan to a participant or beneficiary." (U.S. Senate via American Benefits Council)

Eliminating 401(k) Matches Might Actually Lead to a Savings Boon
Excerpt: "Some researchers are suggesting that employers can put in place automatic enrollment plans and eliminate their 401(k) matches without any adverse effect on participation or contribution rates. In fact, researchers are suggesting that an employer might be better off using the matching-contribution money to minimize 401(k) plan fees, reduce health-care costs or pay for other employee benefits." (MarketWatch via FOX News Network, LLC)

Groups Urge Supreme Court to Uphold QDRO Ruling
Excerpt: "In a motion for permission to file a friend of the court brief, the American Benefits Council, The ERISA Industry Committee (ERIC), and the National Association of Manufacturers (NAM) asked the U.S. Supreme Court to affirm a finding by the 5th U.S. Circuit Court of Appeals that a divorce decree was not a waiver of an ex-spouse's right to benefits." (; free registration required)

New Calculator Reveals Savings Damage from 401(k) Loans
Excerpt: "The National Center for Policy Analysis (NCPA) has developed a calculator that shows 401(k) participants just how expensive taking a plan loan can be. . . . The calculator can be accessed at" (; free registration required)

DOL Issues FAQs on Schedule C Reporting for 2009 Form 5500
Excerpt: "The FAQs provide guidance to plan administrators and service providers to assist in complying with the requirements of the 2009 Form 5500 Schedule C, including guidance on indirect and non-monetary compensation and electronic disclosure of fee information by service providers." (Employee Benefits Institute of America)

Sponsored by: The SPARK Institute

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The SPARK Institute 403(b) Plans Issues & Answers Forums

New rules that go into effect in 2009 will require major changes to 403(b) plans. The SPARK Institute 403(b) Plans Issues and Answers Forums are must-attend meetings for anyone responsible for 403(b) plans at K-12 schools, universities, hospitals, non-profits, TPAs and financial advisors. Sessions will cover fiduciary concerns, plan documents, preparing for 2009 and beyond, information sharing best practices, working with vendors and much more.

(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

[Guidance Overview] IRS Grants Tax Relief to Victims of Storms and Flooding in Missouri
Excerpt: "The IRS has announced special tax relief for taxpayers within a seven-county disaster area in Missouri affected by severe storms and flooding on June 1, 2008." (Wolters Kluwer)

ERISA Reform Legislation Effort
Excerpt: "Professor Colleen Medill at the University of Nebraska College of Law has agreed to help the Amschwand family identify members of Congress who may be interested in sponsoring legislation to amend Section 502(a)(3) of ERISA so that 'equitable' relief includes monetary relief designed to make a plan participant or beneficiary whole for injuries caused by a breach of fiduciary duty." (Workplace Prof Blog)

Newly Posted Events
(Post Yours!)

HEART Act - Complimentary Overview
Nationwide on July 17, 2008
presented by Convergent Retirement Plan Solutions, LLC

Pension, Profit-Sharing, Welfare, and Other Compensation Plans
in District of Columbia on October 2, 2008
presented by ALI-ABA (American Law Institute-American Bar Association)

Retirement, Deferred Compensation, and Welfare Plans of Tax-Exempt and Governmental Employers
in District of Columbia on September 4, 2008
presented by ALI-ABA (American Law Institute-American Bar Association)

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Pension Administrators
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