Retirement Plans Newsletter
January 22, 2010

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[Guidance Overview]
IRS Final Benefit Restriction Regulations (PDF)

6 pages. Excerpt: "These developments affect sponsors of and participants in qualified single-employer and multiple employer defined benefit plans." (Prudential Retirement)

[Guidance Overview]
IRS's 2010 Schedule of Employee Plan User Fees

Excerpt: "The IRS has updated its user fee schedule in IRS Revenue Procedure. 2010-8, effective January 4, 2010, for requests for various types of employee plan letter rulings and determination letters, and other matters under the jurisdiction of the Commissioner, Tax Exempt and Government Entities Division." (Wolters Kluwer)

[Guidance Overview]
DOL Final Regulations Establishing Safe Harbor for Small Employers to Timely Deposit Elective Deferrals, Other Employee Contributions, and Participant Loan Repayments

Excerpt: "Consistent with the February 2008 proposed regulations, if the employer deposits the withheld amounts in the trust no later than the 7th business day following the date the employees would have received the contributions (payday), the regulations deem that the employer has satisfied the requirement to pay the contributions as soon as reasonably practical. The DOL adopted the proposed regulations with only minor changes." (SunGard Relius)

[Guidance Overview]
The Curious Matter of 403(b) Plan Disqualification

Excerpt: "403(b) itself only has 2 things that will cause all participant accounts to lose their 403(b) status (something I guess you could loosely call 'plan disqualification'): the plan being sponsored by an ineligible employer and the plan's contributions being discriminatory (which includes violating the universal availability rule). Period. Nothing else does it." (Robert J. Toth, Jr.)

State Legislation Affecting Public Retirement Plans, 2005-2009
Excerpt: "In general, states have made a broad range of relatively minor changes to plans, rather than undertaking fundamental change. Their goal has been to adjust rather than radically alter their retirement plans. Several of the states listed in this report have made a number of the following changes at once: Increases in employee contributions; Extending the period over which salary is calculated for the purpose of determining retirement benefits; Increases in the age or service requirement, or both, for eligibility for retirement benefits Anti-spiking provision; Reductions in or greater controls over post-retirement cost-of-living adjustments." (National Conference of State Legislatures)

When to Take Social Security: Questions to Consider (PDF)
16 pages. Excerpt: "Retirees can claim Social Security benefits at any age between 62 and 70. There are sound financial reasons to work beyond the earliest age and to delay claiming Social Security benefits if you can. Monthly benefits will be higher for the rest of your life if you wait. . . . At advanced ages, work may no longer be an option, pensions may be eroded by inflation and savings may be depleted. Maximizing Social Security benefits for the long term can offset some of the decline in other sources of support." (National Academy of Social Insurance)

Additional Data on IRA Ownership: Appendix to The Role of IRAs in U.S. Households' Saving for Retirement, 2009 (PDF)
20 pages. Excerpt: "The January 2010 issue of Fundamentals covers U.S. households' individual retirement account (IRA) ownership in 2009. The report highlights data collected by the Investment Company Institute in a recent survey of households owning IRAs. This appendix provides supplementary tables with additional detail for the January 2010 Fundamentals." (Investment Company Institute)

The Role of IRAs in U.S. Households' Saving for Retirement, 2009 (PDF)
22 pages. Excerpt: "With $3.7 trillion in assets in mid-2009, individual retirement accounts (IRAs) represented about one-quarter of U.S. total retirement market assets, compared with 15 percent two decades ago. IRAs have also risen in importance on household balance sheets. In June 2009, IRA assets were 9 percent of all household financial assets, up from 4 percent of assets two decades ago. In May 2009, 46.1 million, or 39 percent of, U.S. households reported owning IRAs . . . ." (Investment Company Institute)

Assessing the State of Defined Contribution Plans Today: A Survey of Plan Sponsors
32 pages. (AllianceBernstein L.P.)

Data Show That Automatic Enrollment in 401(k) Plans Has Led to Higher Match Rates from Large Plan Sponsors (PDF)
4 pages. Excerpt: "New research from the nonpartisan Employee Benefit Research Institute (EBRI) finds that employers adopting automatic enrollment in their 401(k) plans have also generally increased the 'employer match' to participant's accounts -- in some cases, by a significant amount. The EBRI research is the first using actual plan information on both actual auto enrollment and actual match rate information both before and after adoption of auto enrollment." (Employee Benefit Research Institute)

DOL Amicus Brief, in Support of Plaintiffs, Kanawi v. Bechtel Corporation
Excerpt: "ARGUMENT: I. ERISA Section 404(c) Does Not Provide a Defense To The Defendants' Alleged Imprudence and Disloyalty in Offering The Fremont Mutual Funds II. The District Court Articulated and Applied The Wrong Legal Standards To Plaintiffs' Prudence and Loyalty Claims, and Erred in Granting Summary Judgment on Those Claims III. Each Payment Made To FIA For Plan Assets Invested With Fremont Mutual Funds Was A Potential Prohibited Transaction" (U.S. Department of Labor)

Towers Watson U.S. Legislative Tracking Charts: Retirement and Executive Compensation, Updated January 19, 2010 (PDF)
13 pages. Excerpt: "Thousands of bills are introduced in Congress but only a select few are summarized on this chart. This selection represents our best judgment on the likelihood of enactment and the relevance of the issue for employers." (Towers Watson)

Looming Pension Liability Worries Washington State Officials
Excerpt: "Two of the retirement plans the state administers are deemed 'at risk.' They are plans that cover older teachers and public employees (Teachers' Retirement System Plan 1 and Public Employees Retirement Systems Plan 1). They are funded at 77 percent and 72 percent, respectively. Other state plans, including those that cover people working now, are funded at above 100 percent but the Office of the State Actuary warns the bad economy will put pressure on those plans, too." (SEATTLEPI.COM)

Baltimore City, MD, Council to Discuss Pension Bills
Excerpt: "Steve Bailey, co-chairman of the Baltimore County chapter of Americans for Prosperity -- a group supporting smaller government and which organized tax protest tea parties in the state -- said the two bills sponsored separately by council members Kevin Kamenetz and Joseph Bartenfelder limit the debate 'to what we consider two overly generous pension plans.' Bailey said his group plans to offer a third option and ask the council to delay a vote until all three can be considered together." (Towson Times)

New Jersey Governor Promises to Eliminate a Number of Boards and Commissions Where Political Appointees Are Able to Pad Their Public Pensions
Excerpt: "Most, if not all, of [former governor] Corzine's hires will have no job in the new Republican administration. As board appointees, however, they can add service years toward a pension -- meaning they can earn credit toward the 10-year minimum to qualify, or increase their retirement payout if they're already vested. 'This is stuff that's been done by previous governors and previous administrations to keep their friends in the pension system in order to accumulate the number of years they need to get the maximum amount of payoff they can get from the taxpayers,' Christie said." (North Jersey Media Group)

Early Bird Registration Discount Ends Today!

Early Bird Registration Discount Ends Today!

The ASPPA 401(k) Summit | March 14 Ė 16, 2010 | Orlando World Center Marriott Resort

The ASPPA 401(k) SUMMIT is bigger and better than ever in 2010! Expect 140 exciting exhibits in the hall, dozens of top-notch workshop sessions like "Plan Designs for the Age of Obama," and the presentation of the prestigious Morningstar-ASPPA 401(k) Advisor Leadership Award. The SUMMIT offers 14 hours of ASPPA Continuing Education (CE) credit and is designed to comply with various CE programs, including ERPA CPE.
For more information and to register, click here: The ASPPA 401(k) SUMMIT.


Executive Compensation; Benefits in General

[Guidance Overview]
Compliance Calendar: Significant Compensation and Benefit Due Dates for 2010 (PDF)

10 pages. Excerpt: "This compliance calendar assumes a plan administered on a calendar year-end basis by an employer with a calendar year-end fiscal year. Events that are non-annual in nature, or directly related to specific circumstances of individual participants (such as retirement forms), are not included in this calendar. In general, the information for pension plans applies to single employer plans; multiemployer plans (i.e., Taft Hartley plans) may be subject to different requirements . . . ." (Hewitt Associates)

[Guidance Overview]
IRS Correction Program for Nonqualified Deferred Compensation Plans That Violate Section 409A As a Result of Certain Plan Document Failures (PDF)

4 pages. Excerpt: "Based on the guidance and relief provided under the Notice, companies should consider taking the following steps: [1] Confirm with all business units and all relevant departments that severance, employment agreements, reimbursement arrangements, commission plans, bonus plans and deferred compensation plans have been reviewed for compliance with Section 409A. [2] . . . ." (Thompson Hine LLP)

[Guidance Overview]
Annual Information Statements and Returns for Incentive Stock Options and Employee Stock Purchase Plans and Other Reporting Requirements

Excerpt: "These statements must include specific information, which is included in our sample ISO statement and our sample ESPP statement. Information statements may either be mailed to the recipient's last known address or, if the recipient has given his or her consent to receive the statement electronically, provided in electronic format." (Orrick, Herrington & Sutcliffe LLP)

2009 Legislative and Regulatory Year in Review and the Outlook for 2010
Excerpt: "This two-[document] report, linked to at right [of target page], summarizes key legislative activity at the federal level in 2009 and discusses the legislative outlook for 2010, generally from the perspective of employer-sponsored employee benefit and HR programs. In addition, the report summarizes significant regulatory guidance in 2009." (Hewitt Associates)

Towers Perrin U.S. Legislative Tracking Charts: Human Resources, Updated January 19, 2010
11 pages. Excerpt: "Thousands of bills are introduced in Congress but only a select few are summarized on this chart. This selection represents our best judgment on the likelihood of enactment and the relevance of the issue for employers." (Towers Watson)

Webcasts and Conferences

Employee Benefits for Same-Sex Married Spouses and Domestic Partners
Nationwide on February 10, 2010
presented by ABA Joint Committee on Employee Benefits

Extension of COBRA Premium Subsidy Rules: How to Keep Turning on a Compliance Dime
Nationwide on January 21, 2010
presented by EBIA / Thomson Reuters

(Click to post your webcast or conference)

Press Releases

Data Show That Automatic Enrollment in 401(k) Plans Has Led to Higher Match Rates from Large Plan Sponsors
Employee Benefit Research Institute (EBRI)

Transamerica Retirement Services Bests Industry Peers in Prestigious Client Satisfaction Survey
Transamerica Retirement Services

Law Firm Announces Class-Action Lawsuit Against Sterling Financial
Hagens Berman Sobol Shapiro LLP

New Research Reveals Significant Differences Between Small and Large Defined Contribution Plan Sponsors in Their Understanding of Fiduciary Responsibility

Financial Research Corporation Announces Two Key Appointments
Financial Research Corporation

ShareBuilder 401k Unveils New Fee Program
ShareBuilder 401k

Noted ERISA Attorney Concludes That Great-West Retirement Services' Target Date Funds Help Sponsors Satisfy Fiduciary Duties
Reish and Reicher

(Click to post your press release)

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Newly Posted Employee Benefits Jobs

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Employee Benefit Attorney (With at Least 5 Years Experience)
for Chang, Ruthenberg & Long
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Employee Benefit Attorney With ESOP Experience
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