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September 30, 2008

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

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[Official Guidance] Text of IRS Notice 2008-85: Updated Static Mortality Tables for Years 2009 Through 2013 (PDF)
19 pages. Excerpt: "These tables apply for purposes of calculating the funding target and other items for valuation dates occurring during calendar years 2009 through 2013. This notice also includes a modified 'unisex' version of the mortality tables for use in determining minimum present value under § 417(e)(3) of the Code and § 205(g)(3) of ERISA for distributions with annuity starting dates that occur during stability periods beginning in calendar years 2009 through 2013." (Internal Revenue Service)

[Official Guidance] Text of Rev. Proc. 2008-62: Use of DB Plan-Specific Substitute Mortality Tables (PDF)
27 pages. Modifies Rev. Proc. 2007-37; incorporates changes from the final regulations under Code section 430. Requests for approval filed on or after December 1, 2008 must comply with the new procedures. Earlier-filed requests may comply with the new procedures or alternatively may satisfy the requirements of the proposed regulations and Rev. Proc. 2007-37. (Internal Revenue Service)

[Guidance Overview] Proposed Regs Require Defined Contribution Plans to Disclose Fee and Investment Information to Participants Beginning January 1, 2009 (PDF)
7 pages. Excerpt: "The proposed effective date of the new requirements is plan years beginning on and after January 1, 2009. While it's possible the DOL may defer this effective date, the DOL has indicated it intends to finalize the regulations before the end of this year. It's likely that final regulations will be similar to the proposed version in many respects." (Alston & Bird LLP)

[Guidance Overview] September 30th Deadline for Obtaining Adjusted Funded Target Attainment Percentage Actuarial Certification
Excerpt: "The IRS is reminding defined benefit plan sponsors that are subject to Code Sec. 436 and which have calendar plan years that they must obtain an actuarial certification of the plan's adjusted funded target attainment percentage (AFTAP) for 2008 prior to October 1, 2008." (Wolters Kluwer)

[Guidance Overview] Recently Revised IRS Correction Program Offers Retirement Plan Sponsors Incentives To Correct Plan Errors Voluntarily
Excerpt: "EPCRS is designed to offer plan sponsors incentives to identify and correct plan errors voluntarily. Correcting errors in accordance with EPCRS can help a plan sponsor avoid the loss of the tax-favored status of a plan and the imposition of significant monetary penalties that might otherwise be imposed if the error was discovered by the IRS on audit. There are three distinct components of EPCRS: (i) the Self-Correction Program ('SCP'); (ii) the Voluntary Correction Program ('VCP'); and (iii) the Audit Closing Agreement Program ('Audit CAP')." (Bond, Schoeneck & King, PLLC)

[Guidance Overview] Federal Court Denies Class Certification In Major ERISA Revenue Sharing Class Action Suit
Article by Sidley Austin's Insurance Class Action Defense and ERISA Litigation Practices; originally published on 5 September 2008. Excerpt: "In a first-of-its-kind victory for the financial services industry, a federal district court in Iowa has denied class certification in an ERISA class action suit that challenged so-called 'revenue sharing' associated with retirement plans. Ruppert v. Principal Life Ins. Co.,No. 4:07-cv-0344-JAJ (S.D. Iowa Aug. 27, 2008). The case concerned whether 'revenue sharing' payments from mutual funds violated the Employee Retirement Income Security Act of 1974 (ERISA)." (Mondaq)

Are You Risking Your Own Retirement to Care for a Parent?
Excerpt: "According to a study last year by the health care coordinator Evercare and the Maryland-based nonprofit National Alliance for Caregiving (NAC), about half of all those caring for someone older were helping them out financially -- at an estimated average level of $5,531 a year. That worked out to more than 10 percent of the median income of the group surveyed, with those earning lower incomes often carrying the heaviest burden." (AARP)

The Decline of Career Employment
Excerpt: "[S]ome indication that people might be willing to work longer comes from the fact that the century-long downward trend in the labor force participation of older men has clearly ceased, with participation rising slightly since the mid-1990s. But the changes to date fall far short of what is required to offset declining Social Security benefits and modest 401(k) balances – an increase in the average retirement age from the current 63 to an estimated 67." (Center for Retirement Research at Boston College)

Taiwan's Labor Insurance Pension System Reformed
Excerpt: "New revisions to labor laws in Taiwan will take effect on January 1, 2009, and will enable workers to receive a regular monthly pension after retiring. Premiums are expected to double by 2028, resulting in a jump in the effective cost for employers of providing labor insurance." (Watson Wyatt Worldwide)

Resources for Information About Treasury's Temporary Guarantee Program for Money Market Funds
Excerpt: "The Treasury has issued FAQs concerning the government's recently announced guarantee program for money market funds." (Attorney B. Janell Grenier via

Maryland Local Governments Fret over Possible Pension Cost Shift
Excerpt: "Local Maryland government officials say they will be in a tough spot if Governor Martin O'Malley tries to shift the state's $622 million teachers' pension costs to the cities and counties to help the state out of its dire financial straits." (; free registration required)

Teamsters Win 401(k) in Waste Management Strike Deal
Excerpt: "The key part of a deal solving a labor dispute between the Teamsters and Waste Management is the agreement to move the employees to a new 401(k) program. A news report from the Milwaukee Journal Sentinel said the employees are being taken out of the financially troubled Central States Pension Fund. The company will put in $1,000 to each employee's account as well as a matching contribution." (; free registration required)

Caterpillar Fee Suit Survives First Legal Hurdle
Excerpt: "A federal judge cleared the way for participants in Caterpillar's 401(k) plan to pursue their fiduciary breach claims, but only on issues other than allegations of inadequate revenue-sharing disclosures." (planadvisor)

Sponsored by: Financial Research Associates

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The Plan Sponsor Defined Contribution Summit: For Public and Private Plan

FRA's Plan Sponsor DC Summit is truly a one-of-a-kind conference designed specifically to bring together public and private pensions who either have a defined contribution plan or are looking to add one to their benefit offerings. For the first time, private and public pensions will come together and make headway in unifying the voice of defined contribution/401k plans to drive the future of employee benefits in the right direction.

(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] Considerations for Accelerating Deferrals Under 409A Transition Rules
Excerpt: "As companies enter the final stage of bringing nonqualified deferred compensation arrangements into compliance with Section 409A of the Internal Revenue Code, several transition opportunities expiring at the end of 2008 merit attention. One interesting opportunity is the ability to accelerate payment of deferred compensation into 2009. This option may deserve close consideration, given the upcoming presidential election and the potential for higher individual tax rates under a new administration. This Update reviews this issue and addresses factors to consider in deciding a strategy." (Mercer LLC)

Curbs on Foreign-Paid Nonqualified Deferred Compensation Pass Senate; Enactment May Be Near
Excerpt: "A Senate-passed tax 'extenders' package would impose harsh tax rules on nonqualified deferred compensation (NQDC) paid by some foreign companies to US taxpayers, generally effective for services performed after 2008. The bill would cover NQDC paid by a foreign company unless substantially all of its income is effectively connected with a US trade or business or subject to a comprehensive foreign income tax. US taxpayers would be taxed when the NQDC vests, even if payments are not yet due. Though the House favors an extenders bill that offsets tax breaks, the NQDC curbs may yet pass Congress." (Mercer LLC)

What Happens When We Forget To Diversify
Excerpt: "When you diversify, all you're really doing is hedging against a future unknown. It's like using crutches after you break your leg. You have to distribute your weight just right to keep from falling or putting too much pressure on any one side of your body. The same is true with your money. You have to be strategic about accumulating cash, debt and assets. If the distribution of any one of those areas is way off, you can fall." (The Washington Post; free registration required)

Fact Sheet: Your Employer's Bankrup.tcy - How It Affects Your Employee Benefits (PDF)
Excerpt: "This information sheet focuses on bankrup.tcy's effect on pension plans and group health plans." (U.S. Employee Benefits Security Administration)

New Jersey Pension Bill Signed Into Law
Excerpt: "Legislation aimed at reducing the state's pension and health-care costs in an effort to save both taxpayer money and the benefits system on which public workers rely was signed into law Monday. The bipartisan Public Employee Pension and Benefits Reform Act of 2008 . . . is projected to save the state $150 million in benefits expenses over the next 14 years." (Asbury Park Press)

Newly Posted Events
(Post Yours!)

Fiduciary Education Seminar - "Getting It Right – Know Your Fiduciary Responsibilities"
in Pennsylvania on October 30, 2008
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Newly Posted Press Releases
(Post Yours!)

PBGC Assumes Pension Plan Of Marcal Paper Mills Inc.
Pension Benefit Guaranty Corporation (PBGC)

ExpertPlan Enters Defined Benefit Market with “ExpertPlan OnePersonPlus®"

Treasury Releases New Guidance Helping Soldiers Keep Health FSAs Funds
U.S. Treasury Department

The Economy's Latest Victim: Employee Retirement Savings, Says Aon Consulting
Aon Consulting

Introducing the New Payden/Kravitz Cash Balance Mutual Fund

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Project Manager Health & Welfare Vendor Management
for Discover Financial Services
in IL

EBS Associate Actuary
for EBS Benefit Solutions (an Excellus Company)
in NY

Account Manager
for The Standard
in MA

Employee Benefits and Executive Compensation Attorney
for Leonard, Street and Deinard, P.A.
in MN

for Transamerica Life Insurance Company, an AEGON company
in IA

Director, Plan Administration
for Public Service Pensions Board of the Cayman Islands

Development Analyst
for Diversified Investment Advisors, Inc.
in MA

Manager, Contracts
for Prudential
in NJ

Assistant Director - Medical Claims
for 1199SEIU Family of Funds
in NY

COBRA Processor/Administrator
for A Progressive Growing Organization in Northwest Suburbs Of Chicago
in IL

Retirement Plan Administrator
for Creative Retirement Solutions, LLC
in CA

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