BenefitsLink |
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| January 30, 2009 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
Today's sponsor is DATAIR Employee Benefit Systems, Inc.
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[Guidance Overview]
Supreme Court Clarifies That a Former Spouse's Benefits Are Governed by Plan's Express Terms
Excerpt: "To assist plan administrators and employers in utilizing the Kennedy decision to make benefit administration less complicated, employers need to review the terms of their benefit plans to ensure that the benefit distribution rules and beneficiary designation provisions are clear and unambiguous. Also, other important plan-related forms, such as beneficiary designation forms, should be reviewed to insure that they are clear and properly notify participants of the decisions they are undertaking." (McDermott Will & Emery)
[Guidance Overview]
Order Awarding Pension Benefits After 30-Year 'Quasi-Marriage' Constituted a QDRO
Excerpt: "A court order awarding pension benefits following the dissolution of a 30-year 'quasi-marriage' constituted a qualified domestic relations order (QDRO) under ERISA. This was the decision of the Ninth Circuit U.S. Court of Appeals in Owens v. Automotive Machinists Pension Trust (No. 07-35253)." (Wolters Kluwer)
Procedures Updated for Furnishing of Technical Advice by EP/EO Technical Offices
Excerpt: "The IRS has issued updated procedures for the furnishing of technical advice memoranda (TAM) by Employee Plans (EP) Technical or Exempt Organizations (EO) Technical offices to EP and EO Examinations Area managers, EP and EO Determinations managers, or Appeals Area Director in the employee plans (including actuarial matters) and the exempt organizations areas. The procedure also explains a taxpayer's rights when an EP or EO Examinations Area manager, an EP or EO Determinations manager, or an Appeals Area Director requests technical advice regarding a tax matter." (Wolters Kluwer)
TE/GE Procedures for Issuing Rulings Updated
Excerpt: "The IRS has updated its procedures for employee plans (EP) and exempt organizations (EO) to obtain guidance on issues under the jurisdiction of the Commissioner, Tax Exempt and Government Entities Division (TE/GE). The IRS provides such guidance in the form of letter rulings, closing agreements, compliance statements, determination letters, opinion letters, advisory letters, information letters, revenue rulings, and oral advice. The revenue procedure, which is effective January 5, 2009, contains the IRS's general procedures applicable to letter ruling request from employee plans and exempt organizations." (Wolters Kluwer)
Planning for Retirement? Web Calculators Weak on Health Costs, According to Report
Excerpt: "Consumers face the challenge of estimating retirement savings needs. This issue paper . . . explores how 12 web calculators handle health costs in planning retirement income. They found that the calculators reviewed provide different estimates and use different variables in their calculations. Most don't provide consumers with much information to help them understand and estimate their health care spending needs in retirement." (AARP)
Rate Your 401(k)
Excerpt: "Have you ever wondered how your 401(k)'s company match, fees, and investment choices compare to those offered by other employers? Now there's a place where you can dish all the juicy financial details online. BrightScope Inc. [http://www.brightscope.com/], an independent data analysis firm, launched the nation's first online 401k rating system today." (U.S. News & World Report)
Baltimore, Md, Considers Cuts to Pension Benefits
Excerpt: "Prompted by hefty increases in pension costs for an already financially strapped city, Mayor Sheila Dixon said Wednesday that officials were considering cutting benefits and increasing employee contributions as part of an overhaul of Baltimore's retirement system." (The Baltimore Examiner)
Retirement Strategies: The Three Best Ways to Rescue Your 401(k)
Excerpt: "There are plenty of ways to react, ranging from indifference to outright panic. Neither extreme will prove productive. However, there are some options in between that will form the foundation of any sound retirement plan rebuilding strategy. After reviewing a plethora of options, Money Morning offers you the three best ones. Retirement Rescue Tip No. 1: Don't Cash Out. . . . Retirement Rescue Tip No. 2: Balance and Rebalance. . . . Retirement Rescue Tip No. 3: It's a Marathon, Not a Foot Race." (Money Morning)
U.S. Pension Funds Have Lowered Investment Return Expectations
Excerpt: "U.S. pension funds are projecting sharply reduced investment returns from major asset classes through 2013, according to new research from Greenwich Associates. A Greenwich press release said overall, corporate pension funds interviewed from July to October 2008 indicated they had reduced investment returns on plan assets to 7.4% annually in 2008 from 8.2% in 2007, and public funds cut overall portfolio return expectations to 7.6% from 8.5%." (PLANSPONSOR.com; free registration required)
Reader's Digest 'Recession Plan' Includes Match Suspension
Excerpt: "The Reader's Digest Association, Inc. has informed employees that it will adopt a global 'Recession Plan' to strengthen its financial performance in the current economy, which includes a the suspension of company matching contributions to its U.S. 401(k) plan. Other cost-savings measures in the plan include a reduction of approximately 8% of its current global workforce and unpaid time off for employees in both Fiscal 2009 and 2010 where permitted by laws and agreements, according to a news release." (PLANSPONSOR.com; free registration required)
Seattle Times Requesting Union Cooperation in Freezing Pensions
Excerpt: "Struggling Seattle Times Co. said Wednesday it will ask some of its unionized workers to allow the freezing of future accruals to their pension funds. In a five-page memo to employees obtained by the Seattle Post-Intelligencer, Times Co. Senior Vice President Alayne Fardella said a freeze would improve the company's financial situation this year. Earlier this month, The Hearst Corp., which owns the Post-Intelligencer, put the newspaper up for sale and said it would stop printing the newspaper in 60 days if no buyer is found." (PLANSPONSOR.com; free registration required)
Minnesota Firm Slaps State Street with Subprime Suit
Excerpt: "State Street has been hit with another federal court lawsuit alleging it took positions in risky subprime mortgage-backed securities in its Daily Bond Market fund, without telling anyone it had done so. Apogee Enterprises, a Minneapolis-based glassware manufacturer, charged that the investment decisions State Street made regarding the bond fund represented breaches of State Street's fiduciary duties under the Employee Retirement Income Security Act (ERISA) that ended up costing its 401(k) plan more than $5 million." (planadvisor)
[Opinion]
Groom Comments on 2009 Suspension of Required Minimum Distribution Rules (PDF)
5 pages. Excerpt: "Groom Law Group submitted the attached letter to the IRS to request additional clarifying guidance with respect to the 2009 suspension of the required minimum distribution rules for defined contribution plans described in Code section 401(a), 403(b) plans, governmental 457(b) plans, and IRAs provided under the Worker, Retiree, and Employer Recovery Act of 2008." (Groom Law Group)
[Opinion]
Are Certain Reactions to the Investment-Advice Regulations Ill-Advised?
Excerpt: "[W]herever one comes out on the PPA's new exemptions and the DOL's rulemaking in connection therewith, it seems hard to argue with the basic point that participants in participant-directed plans need high-level help and guidance regarding their management of these most-important investment assets. I would prefer that the open questions on this critical matter get resolved by a careful examination of the statute and what informed it, not through highly charged, emotional descriptions of what we now have before us and how we got to this point. But (with apologies for the grammar that's about to follow), that's just me." (Pension & Benefits Blog)
[Opinion]
What to Do About Social Security
Excerpt: "[A] compromise would result in good policy. Social Security needs to be brought into balance, and reasonable spending cuts would do less economic damage than tax increases. Long-term investment is still a good idea for young people. Besides, the ideological divide over 'carve-out' and 'add-on' accounts is absurd: whether the accounts are inside or outside Social Security is largely a question of accounting. And who knows? Cooperation on Social Security could pave the way for bipartisan solutions on everything from tax reform to Medicare, by building good will and showing that such accomplishments are possible." (The New York Times; free registration required)
BLAZE SSI Corp. (Sponsor)
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| GTS OnDemand - Pay per Plan - No Annual Fee - from BLAZE SSI |
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Links to Items on Executive Comp, Benefits in General
[Guidance Overview]
IRS Guidance on Deferred Compensation from Offshore Funds (PDF)
5 pages. Excerpt: "On January 8, the Internal Revenue Service (IRS) issued preliminary guidance on the taxation of deferred compensation from offshore investment partnerships and other tax-indifferent entities. Notice 2009-8, which is intended to provide interim guidance under Internal Revenue Code Section 457A until formal regulations are adopted, answers critical questions raised after the initial enactment of Section 457A and affirms that Section 457A is intended to have a wider scope in many respects than the counterpart provision on deferred compensation, Section 409A." (Pillsbury Winthrop Shaw Pittman LLP)
[Guidance Overview]
New Tax Rules Proposed for Employee Stock Purchase Plans
Excerpt: "The Internal Revenue Service and Treasury Department have proposed new regulations for Internal Revenue Code ('Code') Section 423 employee stock purchase plans ('ESPPs'). The proposed regulations are the first comprehensive update of existing ESPP tax rules that have been in effect since the 1960s. In addition, the proposed regulations contain important guidance for employers that maintain or that are considering implementing ESPPs. The proposed regulations are scheduled to become effective on January 1, 2010 but may be relied on for periods prior to that date." (McGuireWoods LLP)
[Guidance Overview]
Net Exercise of Stock Options Becomes Attractive as Result of Changes in Accounting Standard (PDF)
2 pages. Excerpt: "Conclusion: Because of the positive changes provided by new accounting standards, net exercises of stock options are an attractive and practical benefit. Net exercises are administratively less burdensome for the sponsor and a cost-free additional benefit for participants. Before implementing any net exercise provisions, companies should consider the tax, securities law, accounting and plan amendment issues that may be implicated by a new net exercise provision." (Kelly, Hannaford & Battles P.A.)
Case Law and Recommendations on Contingent Workers and Employee Benefits (PDF)
Excerpt: "The author reviews case law developments and offers recommendations on how companies and contingent workers might best deal with the issues involved. This is an update of an earlier version of this chapter for the third edition of ERISA Litigation, published by The Bureau of National Affairs in 2008, incorporating all legal developments that occurred through the end of 2007." (The Bureau of National Affairs, Inc. via Janich Law Group)
ERISA Fiduciary Liability Risks Loom Large in Times of Financial Crisis
Excerpt: "The Insurance Journal has published a very useful article by Brian S. Martin, partner in the Insurance and Coverage section of the Houston office of Thompson, Coe, Cousins & Irons L.L.P. The article provides an overview of several areas of risk in the employment setting and insurance coverages which may aid in managing those risks." (Health Plan Law)
Newly Posted Events
Avoiding 401(k) Mistakes - A Common Sense Approach
Nationwide on February 5, 2009
presented by ASPPA (American Society of Pension Professionals & Actuaries)
It's My Money and I Want it Now!
Nationwide on February 19, 2009
presented by ASPPA (American Society of Pension Professionals & Actuaries)
Newly Posted Press Releases
White Paper 'The Successful Retirement Advisor Part II' Published
MassMutual Retirement Services
New Tools Help With New Retirement Plan Reporting Rules
Principal Financial Group
BLAZE SSI & George Taylor Announce GTS OnDemand
BLAZE SSI Corp.
Altigro Acquires Global Pension Services
Altigro Pension Services
401k Rating System and Disclosure Website Launched
BrightScope
Swiss Re's Employer Stop Loss Product Offers US Companies Cost Savings for Self-Funded Health Insurance Plans
Swiss Re
Newly Posted or Renewed Job Openings
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Primary Administrator for Qualified Retirement Plans
for Kidder Benefits Consultants, Inc.
in IA
Handy Links:
- View Today's Active Message Threads
- Using the Web for Employee Benefits Research (hypertext article)
- Employee Benefits Library
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