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April 1, 2009 |
| Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy. |
www.ftwilliam.com (Advert.)
What you need to know about EFAST II On April 22nd, ftwilliam.com will provide a preview of the new EFAST II filing system. We will review registration requirements for plan sponsors and electronic confirmation of filings by DOL. Attendees will also learn how the ftwilliam.com 5500 software will leverage the EFAST II system to provide new features such as workflow management and client portal capabilities. Stop by our website and sign up for our webinar today www.ftwilliam.com! |
[Official Guidance]
Technical Update on ERISA Section 4010 Reporting; Alternative Form-of-Payment Assumption for Determining Benefit Liabilities
Excerpt: "On March 16, 2009 (at 74 FR 11022), PBGC published in the Federal Register a final rule that amends PBGC's regulation on Annual Financial and Actuarial Information Reporting (29 CFR Part 4010) to implement amendments made to ERISA section 4010 by the Pension Protection Act of 2006 and to make other changes. The final rule is effective April 15, 2009." (Pension Benefit Guaranty Corporation)
[Guidance Overview]
IRS Recent Yield Curve Guidance (PDF)
1 page. Excerpt: "The guidance states that employers can rely on a reasonable interpretation of the funding rules for valuing their pension liabilities until the first plan year following the date the funding regulations are finalized. Further, the guidance states that using the full yield curve as of any of the 'lookback months' for 2009 plan years will be considered a reasonable interpretation. Therefore, for a calendar year plan with a January 1, 2009 valuation date, the IRS will not challenge the use of a monthly yield curve for January 2009, or for any one of the four months immediately preceding January 2009." (Buck Consultants)
[Guidance Overview]
IRS Takes 'Reasonable' Approach on Yield Curve
Excerpt: "Defined benefit plan sponsors today got some good news from the Internal Revenue Service (IRS), as the agency said it will allow companies to uses the spot yield curve (used for measuring pension assets and liabilities) for 2009 without regard to what they used in prior years." (PLANSPONSOR.com; free registration required)
[Guidance Overview]
Public Sector Retirement Plan Compliance Wrap-up (PDF)
Excerpt: "This Bulletin discusses the following major public sector provisions of [The Worker, Retiree and Employer Recovery Act of 2008 (WRERA)]: Rate of Return for Crediting Interest, Rollovers, Temporary Waiver of Required Minimum Distributions, and Self-Funded Plans Eligible for Special Tax Exclusion for Retired Public Safety Officers under PPA'06. This Bulletin also provides information about extensions by the Internal Revenue Service (IRS) of several important compliance deadlines for public sector retirement plans." (The Segal Group, Inc.)
[Guidance Overview]
Major Provisions of the Final 403(b) Regulations and Effect on Plans
Excerpt: "What Employers Should Do Now: Review 403(b) plan documents . . . . With respect to 'non-ERISA' plans, analyze the impact of the final regulations . . . . Review eligibility provisions and employer contribution data to ensure compliance with the 'universal availability' and nondiscrimination rules." (Littler Mendelson P.C.)
[Guidance Overview]
How Much Information Is Enough to Decide a Breach of Fiduciary Duty Lawsuit?
Excerpt: "Is a motion to dismiss a good tool for disposing of major breach of fiduciary duty lawsuits? In essence, should it be treated as a mini-summary judgment proceeding, that tests the sufficiency of the case's theories against, not the detailed facts of a specific case, but instead against the world as a whole as understood by the court? Or are these cases instead ones that are better decided by - and both litigants and the development of the case law better served by - a decision on the actual factual merits of a case, after drilling down into the conduct in question?" (Stephen Rosenberg of The McCormack Firm, LLC)
[Guidance Overview]
Waiver of 2009 Required Minimum Distributions from Individual Account Plans
Excerpt: "There are many questions about the implementation of the waiver, but the only official guidance issued so far is IRS Notice 2009-9, which addresses a limited set of questions. This Compliance Alert summarizes the relevant portions of the available guidance with respect to DC plan participants and beneficiaries." (The Segal Group, Inc.)
[Guidance Overview]
Towers Perrin U.S. Legislative Tracking Charts -- Retirement and Executive Compensation -- Updated March 30, 2009 (PDF)
5 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)
The 10 'Most Common and Damaging Financial Decisions' That Will Wreck Your Retirement
Excerpt: "More Americans are in a panic over their retirement planning than at any other time in history because of stock market uncertainty, and many are making expensive mistakes, says the Dallas-based National Center for Policy Analysis, a conservative think tank. 'Out of fear and the best intentions, we are seeing too many people reacting to a bad economic situation and liquidating their own retirement,' said Pamela Villarreal, senior policy analyst at the center. The group has identified 10 of 'the most common and damaging financial decisions' that can wreck your retirement . . . ." (The Dallas Morning News)
Planning a Retirement Without Dividends to Help Pay for It
Excerpt: "[R]elying solely on regular checks from dividend-paying stocks or funds for retirement income is an outdated strategy, with little chance of supporting someone for, say, 30-years. This would be the case, even if dividends were not been disappearing at a record pace (as they have in recent months). For one thing, relying on dividend payers will probably result in a portfolio that's too concentrated in areas like financial stocks, which paid the most in dividends until recently. Financial companies accounted for more than 30 percent of the Standard & Poor's 500 Index's dividend income in 2007, but now account for just 10.6 percent." (The New York Times; free registration required)
The Actuarial Balance of the Pay-as-You-Go Pension System: 'American' Model versus 'Swedish' Model
Excerpt: "The aim of this paper is to show the advisability of making it compulsory to draw up an actuarial balance in pay-as-you-go pension systems so as to improve their transparency and solvency. This is in line with the trend seen in some developed countries of trying to introduce actuarial analysis methodology into the field of public pay-as-you-go pension system management. The paper also aims to shed some light on the two main methods used by government Social Security departments to draw up the actuarial balance, focusing especially on their methodology and actuarial issues." (Social Science Research Network)
Labor Secretary, Plaintiffs, Interest Groups Call for Rehearing in Plan Fee Fiduciary Liability Case
Excerpt: "The plaintiffs in Hecker v. Deere & Co. on March 9 filed a petition for rehearing in the U.S. Court of Appeals for the Seventh Circuit's February 12th ruling affirming the dismissal of claims for allegedly improper revenue sharing and excessive fees in the defendants' Section 401(k) plan. The plaintiffs had alleged that investment options offered by the plan included excessive and unreasonable fees and costs, and that the plan did not adequately disclose information about revenue sharing and costs to the plan participants. The plaintiffs argue that a panel rehearing should be granted because the three-judge panel 'misapprehended the law' by holding that providing an array of retail mutual funds satisfied Deere's duty of prudence under ERISA." (The ERISA Industry Committee)
Recession Puts a Major Strain on Social Security Trust Fund: As Payroll Tax Revenue Falls, So Does Surplus
Excerpt: "With unemployment rising, the payroll tax revenue that finances Social Security benefits for nearly 51 million retirees and other recipients is falling, according to a report from the Congressional Budget Office. As a result, the trust fund's annual surplus is forecast to all but vanish next year -- nearly a decade ahead of schedule -- and deprive the government of billions of dollars it had been counting on to help balance the nation's books." (The Washington Post; free registration required)
The Pension Benefit Guaranty Scandal That Isn't (at Least Not Yet)
Excerpt: "The Boston Globe had a story Monday (which is making the rounds today) about the Pension Benefit Guaranty Corporation's decision last year to switch from investing mostly in fixed-income securities to a mix of 45% fixed-income, 45% equities, 5% real estate and 5% private equity. . . . There's a big difference between deciding to put and actually putting, though, and while the Globe reported that the agency 'refused to say how much of the new investment strategy has been implemented,' a quick look at the PBGC's Annual Management Report (available here) for the fiscal year that ended in September reveals that the answer is probably not much." (Time Inc.)
New Math for IRA Savings
Excerpt: "Usually, the last thing anyone giving financial advice needs to do is to tell Americans to dodge taxes. . . . Yet there's a way to completely avoid paying taxes on retirement savings, and it's perplexingly unpopular. With a Roth IRA, your retirement investments grow tax free. If you get a statement showing you have $200,000 in a Roth IRA, that amount -- and not some lesser figure you have to guesstimate after trying to adjust for taxes -- is what you've got, and you can spend it whenever and however you please. But just 19 percent of working Americans have Roth IRAs, even though 90 percent are eligible for them, according to Fidelity." (SmartMoney)
The Stock-Market Meltdown Has Dealt a Crushing Blow to Retirement Plans: Brace for Repercussions.
Excerpt: "This has already had some short-term effects, notably employees fleeing to safer investments or abandoning 401(k) plans altogether. What it will take to restore their comfort level in equities, and what impact their understandable skittishness will have on their overall retirement strategies, remains to be seen. But far more profound may be the impacts still to come: lawsuits, new regulations, and the specter of an aging workforce that, like a bad party guest, shows no inclination to leave." (CFO.com)
Ageing and the Payout Phase of Pensions, Annuities and Financial Markets
Excerpt: "This paper reviews the impact of aging on private pensions, in particular on the payout phase, assesses the part that annuities can play in financing retirement, and examines the role of financial markets in facilitating the allocation on assets accumulated in defined contribution pension plans. A comprehensive set of recommendations for discussion is provided at the end of the paper." (Social Science Research Network)
Colorado Governor Signs Bill Reshaping State Retirement System
Excerpt: "The Public Employees' Retirement Association will take over two other Colorado state employee retirement plans under a bill signed into law Tuesday by Gov. Bill Ritter. PERA oversees retirement plans for the majority of the state's public workers now, but some others have their money in a defined contribution plan or optional deferred compensation plan through the state. Senate Bill 66 by Sen. Lois Tochtrop, D-Thornton puts those plans under PERA oversight, saving the state some $221,000 a year in administration expenses and eliminating 2.5 full-time equivalency positions." (Denver Business Journal via bizjournals.com; free registration required)
ASPPA (Advert.)
Stay Up To Date at the 2009 Great Lakes Benefits Conference, April 20-21, 2009 Today’s ever changing environment requires you to stay up to date. Get the most for your time and money with ASPPA and the IRS at this annual event. Featured sessions include plan investments and fiduciary responsibility in a troubled economy, current issues impacting EGTRRA restatement and practice management for TPA’s. Join other employee benefit professionals this year in Chicago, IL. Register now and save at www.asppa.org/greatlakes. |
Links to Items on Executive Comp, Benefits in General
[Guidance Overview]
Informal Discussions with IRS Reveal Favorable Interpretation of Severance Pay Withholding Rules
Excerpt: "Rather than paying lump sums, some employers structure severance payments as salary continuation, often basing the duration of the salary continuation on the individual's length of service. Although this approach has certain advantages, such as spreading the employer's cost over time, many payroll professionals have interpreted the IRS regulations as requiring far greater federal income tax withholding on salary continuation payments than was required when the individual received the same amounts as regular wages. Our informal conversations with the IRS, however, reveal that withholding can continue at the same rate as applied before the employee's termination." (Deloitte via BenefitsLink.com)
[Guidance Overview]
Keeping Compensation Committees on an Even Keel in Difficult Times
Excerpt: "There is no denying that these are difficult times for compensation committees, and the continued public focus on executive compensation is not going to dissipate anytime soon. Committee members have, however, been through tough times before. Those who apply what they learned 'the last time around' and practice the eight strategies as discussed in this article will have the basic tools they need to cope with the sea change that is affecting executive pay in every industry." (The Segal Group, Inc.)
[Guidance Overview]
Towers Perrin U.S. Legislative Tracking Charts -- Human Resources -- Updated March 30, 2009 (PDF)
4 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin)
Employee Benefits Getting the Recession Axe?
Excerpt: "National Employee Benefits Day is tomorrow. But it's not a cause of celebration for many. Coverage of health insurance and retirement security are becoming more worrisome issues for both employers and employees in small businesses than ever before." (The Wall Street Journal)
Webcasts and Conferences
(Click to post your webcast or conference)Complying With the New COBRA Subsidy: Advanced Administration Issues
Nationwide on April 16, 2009
presented by EBIA / Thomson Reuters
Disability Claims in a Down Economy
Nationwide on May 20, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)
Distinguished Lecture Series in Employee Benefits Law: "ERISA Among the Ruins - The Future of Retirement Savings After the Financial Crisis"
in Illinois on April 7, 2009
presented by The Center for Tax Law and Employee Benefits at The John Marshall Law School in Chicago
Employee Benefits Law and Practice Update: Spring 2009
Nationwide on April 29, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)
ERISA Fiduciary Responsibility Update for Plan Fiduciaries, Employers & Administrators
Nationwide on June 5, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)
Executive Compensation: Strategy, Design, and Implementation
in New York on June 18, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)
Press Releases
(Click to post your press release)Council Lauds IRS Defined Benefit Pension Guidance
American Benefits Council
FutureOffice Network Presents April Smartcast: New COBRA Updates
Davidson Marketing Group -- FutureOffice Network
Employee Benefits Jobs
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Defined Benefit Plans Unit Leader
for Southern California Pipe Trades Administrative Corporation
in CA
Senior Sales Position
for Delta Health Systems
in AZ
Defined Benefit Business Analyst
for Enterprise Iron
in ANY STATE
Plan Analyst for DC Plan Administration
for Acuff & Associates, Inc.
in TN
401(k) Plan Administrator
for TPA Firm located in South Florida
in FL
Retirement Plan Administrator
for Noble-Davis Consulting, Inc.
in OH
Daily Record Keeping Specialist
for AKT Retirement Plans Services
in OR
Defined Contribution Assistant
for The Standard
in OH
401(k) Administrator
for GAP-Pension Inc.
in NJ
EmployeeBenefitsJobs.com (Sponsor)
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