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June 24, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy

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[Official Guidance]
Summer 2009 Issue of 'Employee Plans News' from IRS (PDF)

13 pages. Excerpt: "This edition contains the following articles: . . . Two-Year Adoption/Submission Period for DC Pre-Approved Plans Expires on April 30, 2010 . . . The EPCU Insider . . . Free Phone Forums . . . A New Look for EP Large Case Program Web Page . . . Employee Plans Published Guidance . . . Calendar of EP Benefits Conferences." (Internal Revenue Service)


[Official Guidance]
Rev. Rul. 2009-18: List of Obsolete Revenue Rulings and Notices Pertaining to 403(b) Programs (PDF)

3 pages. Excerpt: "[The final 403(b) regulations issued in 2007 noted] that since the prior set of section 403(b) regulations were issued in 1964, a number of guidance documents had become outdated due to numerous intervening statutory revisions enacted in section 403(b). In this section, the Internal Revenue Service (IRS) listed a number of documents that it proposed to obsolete after these regulations became final. The IRS received no comments regarding this prior notice to obsolete these documents." (Internal Revenue Service)


[Guidance Overview]
A Decided Victory for Plan Fiduciaries in Company Stock Case as Court Follows Lead of Hecker v. Deere

Excerpt: "In denying the plaintiffs' Motion for Summary Judgment and granting the defendants' Motions for Summary Judgment, the court held as follows: (1) Regarding the plaintiffs' argument that the plan failed to meet ERISA Section 404(c) by not disclosing 'in advance that liability would be shifted to Plaintiffs under the 404(c) plan', the court held that language in a prospectus satisfied that requirement. (2) Regarding the plaintiffs' argument that the plan failed to meet 404(c) by not adequately describing the investment objectives and the 'risk and return' characteristics of the investment options offered by the plan, the court pointed to a general benefits pamphlet which had been distributed to employees and contained a chart describing the investment alternatives." (ERISA Fiduciary Guidebook)


Legislation Calls for More Transparent Disclosures of 401(k) Fees
Excerpt: "Representatives George Miller (D-Calif.) and Rob Andrews (D-N.J.) reintroduced the 401(k) Fair Disclosure for Retirement Security Act (H.R. 1984). Senators Herb Kohl (D-Wis.) and Tom Harkin (D-Iowa) reintroduced the Defined Contribution Fee Disclosure Act (S. 401). And on June 10, Representative Richard Neal (D-Mass.) introduced a modified version of the Defined Contribution Plan Fee Transparency Act (H.R. 2779). . . . All three bills would impose new reporting and disclosure requirements for individual account balance plans, including new disclosures from service providers to plan sponsors and from sponsors to plan participants and beneficiaries. [The chart in the target document] summarizes some key provisions with significant implications for employers." (Watson Wyatt Worldwide)


Consumers Should Take 401(k) Plan Loans Instead of Consumer Loans, Study Contends
Excerpt: "The cost for a non-401(k) plan loan is the after-tax interest rate that is paid to the outside vendor. In contrast, the lower interest rate for a 401(k) plan loan is paid to the participant's account, causing it to grow. The authors noted that a participant who is trying to maximize 401(k) plan contributions but is constrained by the contribution limits 'might prefer a 401(k) loan with a sufficiently high interest rate simply as a way to get more assets into the tax-favored account.'" (Wolters Kluwer)


Employers' Response, or Lack of, to the Retirement Income Savings Challenge (PDF)
Excerpt: "The survey results indicate that, in today's 401(k) world, employers continue to see retirement-related initiatives as a way to attract and retain employees but are essentially unresponsive to the need to retire employees in an orderly and predictable fashion." (Center for Retirement Research at Boston College)


IRS Final List of Out-of-Date 403(b) Documents
Excerpt: "The Internal Revenue Service (IRS) has finalized its list of guidance documents issued in the last 45 years dealing with 403(b) plans declared obsolete in light of the agency's recent comprehensive rules rewrite." (PLANSPONSOR.com; free registration required)


Safe Harbor 401(k) Contributions Made to an ESOP: More Details
In the second installment of her column on the National Center for Employee Ownership's Web site, Nancy Dittmer returns to the topic of safe-harbor 401(k) contributions made to an ESOP. (National Center for Employee Ownership)


Rep. Pomeroy Shares Pension Funding Reform Thoughts
Excerpt: "North Dakota Democratic U.S. Representative Earl Pomeroy on Tuesday unveiled a wide variety of possible approaches to helping defined benefit pension plans make it through the down economy. Among the notions Pomeroy is pondering, according to the 'discussion draft' released by his office, are: A loosening of restrictions on asset smoothing by expanding the corridor which currently limits the smoothed values to stay within 10% of the fair market value (FMV) of plan assets." (PLANSPONSOR.com; free registration required)



TIAA-CREF (Advert.)

TIAA-CREF Compliance Coordinator (clickable image)

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Links to Items on Executive Comp, Benefits in General

[Guidance Overview]
Supreme Court Makes It More Difficult for Employees to Prove Age Discrimination Claims (PDF)

Excerpt: "The U.S. Supreme Court held in a 5-4 decision that a plaintiff bringing a disparate treatment claim under the Age Discrimination in Employment Act of 1967 (ADEA) must prove, by a preponderance of the evidence, that age was the 'but-for' cause of the adverse employment action. Gross v. FBL Fin. Servs., Inc., No. 08-441 (June 18, 2009). The Court's adoption of a but-for causation standard is a departure from the burden of persuasion that courts had used when analyzing ADEA claims." (Sutherland)


Employee Benefits Update, June 2009 (PDF)
The nine-page newsletter presents select compliance deadlines and reminders; retirement plan developments; and, health and welfare plan developments, with comments from Reinhart. (Reinhart Boerner Van Deuren s.c.)


[Opinion]
ERISA in the Crisis Zone

Excerpt: "In the employee benefits sector, seemingly removed from the catastrophic bank and stock crisis, the crisis zone still has yielded proposals like: Additional restrictions on 401(k) plans. A universal thrift plan that would severely erode the traditional 401(k). A universal health care system which would impose greater health care costs on employers, crowding out retirement and other benefit expenditures. This could possibly include mandated benefits. It could ultimately involve universal Medicare coverage or a government entity for the uninsured, obviously to be accomplished by increased payroll and income taxes. A major employee benefits debate would result in another nasty clash between traditional antagonists. We still have those who would support the old paradigm of equilibrium - the same people who have tried but failed to prevent continued innovation in employee benefits, as opposed those who have developed and promoted more flexible approaches." (Employee Benefit News via Passion for Subro)



Webcasts and Conferences

401(k) Safe Harbor and SIMPLE Plans
Nationwide on September 3, 2009
presented by McKay Hochman Co.

403(b) Plan Language In-Depth
Nationwide on August 5, 2009
presented by Qualified Pension Consulting, Inc.

A First Look at Approved 403(b) Prototype -- Archived
Nationwide on June 23, 2009
presented by SunGard Relius

Ethics for ERPAs
Nationwide on September 16, 2009
presented by Qualified Pension Consulting, Inc.

Introduction to DBK Plans
Nationwide on October 7, 2009
presented by Qualified Pension Consulting, Inc.

Participant Loans Overview
Nationwide on August 6, 2009
presented by McKay Hochman Co.

Professional Conduct for ERPAs
Nationwide on September 2, 2009
presented by Qualified Pension Consulting, Inc.

Qualified Plan Beneficiary Issues
Nationwide on July 16, 2009
presented by McKay Hochman Co.

Qualified Transportation Fringe Benefits
Nationwide on October 21, 2009
presented by Qualified Pension Consulting, Inc.

Reducing or Eliminating Safe Harbor Contributions
Nationwide on July 8, 2009
presented by Qualified Pension Consulting, Inc.

VCP Applications, Determination Letters and EGTRRA Restatements
Nationwide on August 19, 2009
presented by Qualified Pension Consulting, Inc.

Vesting and Partial Terminations
Nationwide on July 22, 2009
presented by Qualified Pension Consulting, Inc.

(Click to post your webcast or conference)

Press Releases

Benefit Software Inc. Announces Green e-Benefits Statements: Electronic Distribution and Storage Cuts Costs and Waste
Benefit Software Inc.

ERIC Urges Congress to First "Do No Harm" in Seeking to Reform Health Care
ERIC (ERISA Industry Committee)

Council to House Committee: Health Care Reform Legislation Should Build on Employer-based System
American Benefits Council

Fortune 500 Employers Turn to HighRoads as The President’s Budget Boosts DOL Enforcement
HighRoads, Inc.

RothRetirement.com: A New Website to Help Consumers Understand the 2010 Roth IRA Conversion Opportunity
Convergent Retirement Plan Solutions, LLC

Bridges to Excellence Announces Five New Physician Recognition Programs with Potential to Save Billions of Health Care Dollars
Bridges to Excellence (BTE)

Davidson Marketing Group, LLC Releases Sales RockStar
Davidson Marketing Group -- FutureOffice Network

(Click to post your press release)


EmployeeBenefitsJobs.com (Sponsor)

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