Retirement Plans Newsletter |
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| June 3, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy | ||
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[Guidance Overview]
Pension Legislation in the States During 2009 (as of May 1, 2009)
Excerpt: "This report summarizes major pensions and retirement enactments in the state legislatures as of April 20, 2009. At that time, nearly 40 of the 50 state legislatures and the Legislature of Puerto Rico remained in session. This report is therefore an incomplete review of what will have been enacted by the end of legislative sessions, most of which will have ended by July 1, 2009." (State Legislatures Magazine, National Conference of State Legislatures)
[Guidance Overview]
Letter Ruling Illustrates Need for Care to Preserve Beneficial Taxation of ESOP Stock Distributions
Excerpt: "It is not necessary to physically distribute a stock certificate to the former employee, if he immediately sells the stock back to the employer. However, it is crucial that the ESOP, the distribution documents and the operating procedures clearly provide that the employee is receiving stock from the ESOP and is immediately selling the stock to the employer. The ruling DOES NOT consider the situation where the ESOP itself purchases the stock from the terminated employee, instead of a purchase by the employer." (Warner Norcross & Judd LLP)
Major Auto Parts Supplier Intends to End Salaried Employees' Pension Plan
Excerpt: "Financially troubled auto parts manufacturer Delphi Corp. said it intends to shed its underfunded pension plan for salaried employees and retirees as part of a plan to emerge from bankrup.tcy reorganization." (Business Insurance)
No Bond Safe from Obama's 'Shared-Sacrifice' Plan
Excerpt: "Bondholders have a new risk to contend with -- the Obama administration's policy of 'shared sacrifice.'" (David Reilly on Bloomberg.com)
Jobs That Still Offer Traditional Pensions
Excerpt: "Traditional pensions that pay out guaranteed benefits for life aren't easy to come by these days, as most employers have long since abandoned their traditional pension plans in favor of 401(k)'s. Still, there are some holdout industries that continue to reward lifelong employees with gold-plated retirement benefits. Here are a few places to look for jobs that may offer the coveted traditional pension." (U.S. News & World Report)
Five Years of Corporate Pension Plan Funding Gains Gone in Market Collapse
Excerpt: "The top 100 U.S. corporate pension plans saw their funded status drop by nearly 30 percentage points in 2008, giving up all gains of the previous five years." (Workforce.com)
SEC Staff to Recommend Change for 12(b)-1 Fees - Investment News
Excerpt: "Securities and Exchange Commission Chairman Mary Schapiro has asked SEC staff to prepare a recommendation to change Rule 12(b)-1, she said [on Tuesday, June 2] at a Senate appropriations subcommittee hearing on the commission's fiscal 2010 budget request." (Investment News; free registration required)
Pennsylvania Legislators Unanimously Pass Pension Forfeiture Bill; Accelerates Effective Date of Cessations
Excerpt: "[Pennsylvania] House lawmakers voted unanimously Monday to more quickly cut pension benefits access for state employees who plead guilty to crimes." (CitizensVoice.com)
[Opinion]
Text of Comments Filed to Date re DOL/SEC Hearing on Target Date Funds and Similar Investment Options
The web page of hypertext links is published by the Employee Benefits Security Administration. (Employee Benefits Security Administration, U.S. Department of Labor)
[Opinion]
The Staying Power of Pensions in the Public Sector (PDF)
Excerpt: "This article explores why DB plans have 'staying power' in the public sector, from the perspective of employers, employees, and taxpayers. It concludes that pensions are an effective way to meet the objectives of all three stakeholder groups, suggesting that the public sector ought not to mimic the private sector trend away from DB pensions." (National Institute on Retirement Security)
[Opinion]
SPARK Institute Comments on Proposed 403(b) Prototype Document Program and Model Language (PDF)
14 pages. Excerpt: "The SPARK Institute believes that the most significant revision that is necessary to expand the availability of the prototype program is to permit the use of a vesting schedule in the prototype plan." (SPARK Institute)
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Links to Items on Executive Comp, Benefits in General
[Guidance Overview]Companies Should Consider Installing New Deferral Plans Before July 1 to Maximize 2009 Compensation Deferral Opportunities
Excerpt: "Although §409A imposes strict rules on the timing of employee deferral elections, there may still be opportunities for companies to establish nonqualified deferred compensation arrangements for certain 2009 compensation amounts. This may particularly be the case with respect to certain performance bonuses for calendar year 2009." (BNA Tax Management Inc.)
[Guidance Overview]
IRS Provides Guidance on PPA Rules for Employer-Owned Life Insurance (PDF)
4 pages. Excerpt: "The Internal Revenue Service has published guidance, in question-and-answer format, on a number of outstanding issues arising under the new rules for certain employer-owned life insurance contracts enacted in the Pension Protection Act of 2006 (PPA). New Notice 2009-48 provides the first substantive guidance on these provisions." (Sutherland)
[Guidance Overview]
Recent Cross-Border Pension Developments
Excerpt: "At a recent conference of international pension lawyers in Athens, Greece, a panel comprised of Peter Schonewille with the European Commission in Brussels, Koen Van Duyse of TiberGhien, a Belgian tax boutique, and David Powell of the Groom Law Group in Washington, D.C., compared how the OECD model tax treaty, various EU state tax treaties and the US model tax treaty operate with respect to mobile executives and cross-border pension pooling of assets. " (Groom Law Group)
[Guidance Overview]
Spotting Section 409A Issues in Executive Separation Agreements
Excerpt: "When an executive's employment is terminated, the executive is often asked to sign a separation agreement. Typically, in these agreements an executive waives potential claims against his or her employer in return for severance and other benefits. Advisers for employers and executives in this situation should be aware of potential issues under Section 409A of the Internal Revenue Code." (Groom Law Group)
Alive and Well in 2009? 'Reasonable Compensation' Requirement for Deductibility of Executive Pay
Excerpt: "2009 may well be the year of reasonable compensation limitations. Recent outrage by Congress and the public over bonuses paid to AIG employees and over 'excessive' compensation in general, has produced a climate in which reasonable compensation limits may become meaningful." (BNA Tax Management Inc.)
Administration's Budget Proposal Targets Employer-Owned Life Insurance
Excerpt: "Employers would have less future incentive to buy corporate-owned life insurance (COLI) or bank-owned life insurance (BOLI) if a provision in President Obama's 2010 budget proposal becomes law. The provision would eliminate tax deductions for interest payments allocable to policies on officers, directors and employees (other than 20 percent owners)." (Mercer)
Get Used to a Working Retirement
Excerpt: "There is a major social and cultural message in the current economic collapse to the future retirees of the U.S.: Forget retirement." (BusinessWeek)
Cautions To Employers Considering a Multiemployer Plan
Excerpt: "Are you a small employer that has been faced with the possibility of participating in a multiemployer plan for your union employees? If so, before you sign up, you should carefully consider the pros and cons (especially cons!) of such a plan." (Chang, Ruthenberg & Long)
Press Releases
Older Worker Confidence in Retirement Security Drops Sharply, Watson Wyatt Survey FindsWatson Wyatt
Employ Social Security Strategies as Part of Retirement Planning
Prudential Financial, Inc.
In A Troubled Economy, Executives Agree Effective Employee Communications Must Be Tailored, Personal and Customized
Buck Consultants, an ACS Company
IASB Proposes to Clarify the Accounting for Prepayments for Pension Plans
International Accounting Standards Board (IASB)
(Click to post your press release)
Employee Benefits Jobs
Pension & Retirement Plans Directorfor Nationwide Financial Services Firm Specializing in Retirement Plans
in FL
Medical Claims Adjuster
for UFCW Unions and Employers Health and Welfare Plan of Central Ohio
in OH
Pension Administrator
for Keystone Benefits Group, Inc.
in PA
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