Retirement Plans Newsletter |
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| October 14, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy | ||
ASPPA (Advert.)
Attention all Retirement Plan Professionals! The 2009 ASPPA Annual Conference (November 1 – 4) is bigger and better than ever. Join 1,600 of your peers at the exquisite Gaylord National Resort and Conference Center on the historic Potomac River. Take advantage of over 60 interactive workshops presented by nationally renowned experts and top practitioners from all facets of the retirement plan industry, including representatives from the IRS and DOL. Advance your knowledge. Enhance your credibility. Expand your network of like-minded professionals! This is the industry’s top venue for all retirement plan professionals - - with up to 24 hours of ASPPA CE credit, ERPA CPE credit and core/non-core JBEA credit hours for Enrolled Actuaries, including professionalism credits. In this rapidly changing environment, it’s never been more important to attend. Register today and stay at the top of your game! |
[Official Guidance]
IRS 'Employee Plans News' - October 2009 Special Edition (PDF)
2 pages; contains hypertext links to the new final funding regulations, and a notice of an upcoming October 28 webcast about the required minimum distribution rules and the new 402(f) notice. (Internal Revenue Service)
[Guidance Overview]
Regulation Deadline Approaches for Section 403(b) Plan Sponsors
Excerpt: "Section 403(b) tax-sheltered annuity plans became subject to an updated and revised set of regulations effective Jan. 1, 2009. One of the requirements of the new regulations is that the plan sponsor must maintain a written plan document that satisfies the regulations' various rules and conditions[.]" (McGuireWoods LLP)
[Guidance Overview]
Cash Balance Plan Sponsor Liable for Deficient Disclosures, Appeals Court Rules
Excerpt: "A cash balance plan sponsor is liable for deficient communications about wearaway periods, the US Second Circuit Court of Appeals has ruled in a summary opinion with no precedential effect (Amara v. CIGNA). The appeals court upheld the lower court's order to determine benefits after a pre-PPA cash balance conversion using an 'A+B' approach (instead of the plan's opening balance approach) because the SPD didn't sufficiently alert participants to possible wearaways. The court did not reinstate the traditional formula, which plaintiffs argued was the proper remedy for a faulty '204(h)' notice." (Mercer LLC)
[Guidance Overview]
Final Funding Regs and Benefit Restriction Notices for Single Employer Defined Benefit Plans (PDF)
2 pages. Also, information on a Phone Forum on Retirement Plan Distributions will be held October 28, 2009; Join Martin Pippins and Rhonda Migdail, from IRS Employee Plans Rulings & Agreements, for a 90 minute forum on recent retirement plan guidance. The forum will cover: the new required §402(f) notice; rollovers, including the expanded Roth rollover rules; the 2009 required minimum distribution (RMD) waiver; RMD rules for governmental plans; and paid time off contributions." (Internal Revenue Service)
Hispanics and Retirement: Challenges and Opportunities (PDF)
20 pages. Excerpt: "Hispanics in the United States face an especially difficult challenge in maintaining their standard of living throughout their retirement. This is due to several factors. On average, Hispanics in the U.S. today have lower levels of educational attainment, less earning power, and a lower level of savings than non-Hispanics. Hispanics in the United States are less likely than non-Hispanics to have an employer-sponsored retirement plan, which puts them at a disadvantage for accumulating retirement income." (The Hispanic Institute / Americans for Secure Retirement)
The Fall and Rise of Household Saving (PDF)
14 pages. Excerpt: "In the 1970s, the average personal saving rate was 9.6%. At one time, in 2005, it was less than 1%. For the 40 months between January 2005 and April 2008, the personal saving rate averaged 1.8%. That it was so low for an extended period of time would seem to be cause for worry. In the past, Congress has indicated a desire to promote household saving by, among other things, creating individual retirement accounts, and saving is an important consideration in proposals to reform Social Security. In May 2008, the personal saving rate began to rise. It is too early to tell with any certainty whether that represents the reversal of the long-term decline. What may seem unusual is that the recent rise in household saving occurred at a time of general economic weakness. While policymakers hope to stimulate aggregate demand with an expansionary fiscal policy, the increase in household saving resulted in more than $300 billion less in consumer spending than would have occurred had the saving rate not risen." (U.S. Congressional Research Service)
Current Wave of 401(k) Fee Lawsuits May Be a Harbinger of Things to Come
Excerpt: "The complaint's accusations include charging excessive fees, SJP and VLP effectively setting their own compensation by disbursing plan assets to themselves via Charles Schwab Trust Co. without the sponsor's knowledge, and failing to adequately disclose the revenue-sharing they received. Because the providers effectively exercised fiduciary control over the plan for the purposes of enriching themselves, the complaint says, they violated ERISA. The complaint compares the recordkeeping fees it says were charged by VLP with those of its replacement, Allen, Gibbs & Houlik, L.C. (AGH). If the plan 'had engaged AGH in 2007 instead of VLP to provide recordkeeping services, compensation paid to the recordkeeper for the Plan would have been $2,425 instead of $15,106,' the complaint says, adding that the services provided were 'virtually identical.'" (PLANSPONSOR.com; free registration required)
Asset-Allocation Funds As Retirement Plan Investments: Questions to Ask
Excerpt: "Asset-allocation fund solutions have, to put it mildly, exploded on the retirement plan scene -- aided in no small measure by the sanction of the Department of Labor (DOL) final regulations regarding qualified default investment alternatives (QDIAs). However, the recent market turmoil has drawn a fresh, heightened scrutiny to the philosophy and structure of these popular defined contribution choices and, certainly for plan sponsors, reminded us all that there are differences -- significant differences, in fact -- in how these vehicles are constructed, how they are managed, and even the philosophies underpinning those designs. Now, the 'right' answer for your program will, in many respects, be unique to your program. On the other hand, there are certain basic questions that plan sponsors should know the answers to in choosing an asset-allocation solution." (PLANSPONSOR.com; free registration required)
California Pension Reform Group Goes After Public Employee Plan Abuses
Excerpt: "A California pension reform watchdog group is adding language to its ballot initiative that would prohibit double-dipping, the practice of retired public employees who return to government jobs and simultaneously collect taxpayer-funded retirement benefits and paychecks. The revised measure also will ask voters to ban spiking, a legal means under which employees inflate their retirement through the addition to their pension formula benefits such as car allowances, unused vacation or sick leave. Marcia Fritz, initiative sponsor and president of California Foundation for Fiscal Responsibility, said her group added the restrictions after it learned of the practices through Bay Area News Group's extensive coverage of the issue." (Contra Costa Times)
Baltimore, MD, Police, Fire Pension Costs Could Double Next Year
Excerpt: "An unusual pension benefit for police and firefighters could cost Baltimore $164.9 million next year, nearly double what the city is now paying and a figure that the city's finance director says taxpayers cannot afford. After years of calls for pension reform, board members who oversee the nearly $2 billion system said their Tuesday vote that passes the whopping bill on to City Hall is a message that the fund is close to a breaking point and needs attention." (The Baltimore Sun)
Is There a 401(k) Fix?
Excerpt: "[Roger Ferguson Jr., chief executive of the investment firm TIAA-CREF, has a solution.] Unsurprisingly, his solution is the one his company already sells -- a 401(k)-like plan that Ferguson says has done a better job of boosting retirement savings than the original. The three-and-a-half-million retirement accounts in the TIAA-CREF system have an account that is on average 50% higher than the average 401(k). Ferguson pitched his company's solution to the retirement savings problem to TIME's Stephen Gandel." (Time Inc.)
DATAIR Employee Benefit Systems, Inc. (Advert.)
DATAIR 5500 / PBGC / 1099-R / 5300 / FAS 158 Software Pension Reporter System. Easy to use PC based software for EFAST2 electronic filing. Full instructions and expert support. Choose from 4 modules:
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Links to Items on Executive Comp, Benefits in General
[Guidance Overview]Year-End Deadline for Bonus and Performance-Based Equity Fast Approaching
Excerpt: "An important deadline for amending executive bonus and other performance-based compensation arrangements is approaching quickly. Public companies should review performance-based arrangements (e.g., bonus plans and equity awards) now to ensure compliance with changes announced by the Internal Revenue Service (IRS) under section 162(m) of the Code. Generally, any necessary amendments to address these changes should be made by December 31, 2009." (Groom Law Group)
IRS Begins 409A Audits!
Excerpt: "Frighteningly, the IRS is already conducting audits of companies' compliance with the complex requirements of Code Section 409A. [A redacted copy of an Information Document Request from the IRS] asks more than 15 separate questions on 409A compliance, including . . . ." (Michael Melbinger via Winston & Strawn LLP)
Voluntary Benefits Still Big Part of Enrollment Season
Excerpt: "A new poll shows the continuing popularity of workplace voluntary benefits, and 73% of employers offering voluntary benefits include term life policies. A news release from the International Foundation of Employee Benefit Plans (IFEBP) about the poll said other common options include: vision insurance (53%), long-term care insurance (51%), long-term disability insurance (50%), accident insurance (49%), and dental insurance (48%)." (PLANSPONSOR.com; free registration required)
Webcasts and Conferences
"EFAST2: The Future of Form 5500" in Appletonin Wisconsin on November 18, 2009
presented by SunGard Relius
"EFAST2: The Future of Form 5500" in Syracuse
in New York on November 18, 2009
presented by SunGard
"ERISA Workshop" in Appleton
in Wisconsin on November 19, 2009
presented by SunGard Relius
"ERISA Workshop" in Syracuse
in New York on November 19, 2009
presented by SunGard Relius
"Plan Forms, Notices, and Amendments: Streamlined, Effective, Timely" in Appleton
in Wisconsin on November 18, 2009
presented by SunGard Relius
"Plan Forms, Notices, and Amendments: Streamlined, Effective, Timely" in Syracuse
in New York on November 18, 2009
presented by SunGard Relius
Abandoned Plan Program Workshop
in Pennsylvania on October 22, 2009
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Do's and Don't's for the ERISA Fiduciary
Nationwide on November 12, 2009
presented by Anthony A. Dreyspool, Esq.
HIPAA and Other Health Benefits Laws: Compliance Assistance Seminar
in Oklahoma on May 19, 2010
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
HIPAA HITECH Compliance: Getting into the Weeds
in California on October 19, 2009
presented by ABA Joint Committee on Employee Benefits
The New Interim Final Rule on GINA Protections, the Mental Health Parity Law and CHIPRA
Nationwide on October 20, 2009
presented by ABA Joint Committee on Employee Benefits
Update on Health Care Reform
Nationwide on October 19, 2009
presented by ABA Joint Committee on Employee Benefits
(Click to post your webcast or conference)
Press Releases
Fight to Preserve Flexible Spending Accounts Moves to the House of RepresentativesEmployers Council on Flexible Compensation (ECFC)
Watson Wyatt Data Services Releases 2009/2010 Survey Report on Nonqualified Benefit Policies & Practices
Watson Wyatt Data Services
Senate Finance Committee-approved Measure Offers Most Promising Approach to Health Care Reform, But Concerns Remain
American Benefits Council
Robust Voluntary Products Play A Significant Role In The Overall Benefits Package
International Foundation of Employee Benefit Plans
ING Launches My Retirement Outlook – Unique Web Planning Tool That Integrates Defined Benefit Analysis
ING Retirement Services
New GINA Regulations Will Require Changes to Many Wellness Programs
Miller Johnson
New Mental Health Parity Regulations Delayed
Miller Johnson
(Click to post your press release)
Employee Benefits Jobs
Account Executive - Compliancefor Third Party Administrator
in NC
Plan Administrator / Client Account Manager
for Northwest Plan Services, Inc.
in WA
Regional Managed Care Network Administrator
for EBMS Inc.
in MT
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