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Retirement Plans Newsletter

March 1, 2010

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The ASPPA 401(k) Summit | March 14 – 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.

Sponsored by ASPPA

[Official Guidance]
Text of IRS Notice 2010-23: FBAR Reporting of 'Commingled Fund' for 2009 or Earlier Years Means Only Mutual Funds (PDF)
Excerpt: "Persons with a financial interest in, or signature authority over, a foreign commingled fund that is a mutual fund are required to file an FBAR unless another filing exception, as provided in the FBAR instructions or other relevant guidance, applies. The IRS will not interpret the term 'commingled fund' as applying to funds other than mutual funds with respect to FBARs for calendar year 2009 and prior years. Thus, the IRS has determined that it will not apply its enforcement authority adversely in the case of persons with a financial interest in, or signature authority over, any other foreign commingled fund with respect to that account for calendar year 2009 and earlier calendar years. A financial interest in, or signature authority over, a foreign hedge fund or private equity fund is included in the administrative relief provided in the preceding sentence."
(Internal Revenue Service)

[Guidance Overview]
FBAR Update -- IRS Grants Extension for Some Filers until June 30, 2011
Excerpt: "Notice 2010-23 provides welcome relief with respect to numerous U.S. persons that may have otherwise been required to file FBAR in connection with employee benefit plans and IRAs. The extended filing deadline is a particularly positive development for investment fiduciaries of employee benefit plans, many of whom will likely be eligible for a complete reprieve from any FBAR filing obligation until June 30, 2011. The extension is similarly helpful in connection with plans and IRAs where foreign investments are limited to commingled funds. Unfortunately, however, the new extension does not apply to all plan- or IRA-related filings."
(Groom Law Group)

[Guidance Overview]
FBAR Update -- FinCEN Releases Proposed Regulations and Requests Comments
Excerpt: "The proposed regulations provide welcome filing relief for governmental plans, retirement plan participants and IRA owners, and for individual employees of registered investment advisors advising registered mutual funds. However, the proposed regulations do not provide any relief for plan investment fiduciaries and fail to provide any guidance relevant to the reporting of plan foreign accounts on fiduciaries' personal income tax returns -- an issue that must be resolved before the April 15, 2010 federal income tax filing deadline."
(Groom Law Group)

[Guidance Overview]
U.S. Department of Labor Provides Guidance on Reporting Obligations of 403(b) Plan Sponsors
Excerpt: "Employers should revisit their plans to determine whether they are subject to the new Form 5500 reporting requirements, which include new audit and reporting obligations."
(McDermott Will & Emery)

[Guidance Overview]
Basics of the Form 5500 Filing Requirements for 403(b) Plans
Excerpt: "In final rules released in late 2007, the Department of Labor (DOL) eliminated the exemption that 403(b) plans long enjoyed on reporting most financial information for the 5500. This rule goes into effect for the 2009 reporting year and means even more work remains ahead for 403(b) plans this year."

[Guidance Overview]
SEC Implements Measures to Educate Investors about Proxy Matters
Excerpt: "The Securities and Exchange Commission (SEC) launched several educational measures to increase investor knowledge of proxy issues and to encourage greater participation in corporate elections."
(International Foundation of Employee Benefit Plans)

Tax Traps in Roth IRA Conversions
Excerpt: "The Roth IRA conversion floodgates are open. But while the attraction of 'tax-free forever' can be powerful, Roth conversions can trigger unintended tax traps and financial problems that are often not addressed until it's too late. Here are five of the most common traps:"
(Ed Slott in Financial Planning)

Collective Investment Trusts Make a Comeback Within 401(k) Plans
Excerpt: "[T]he market's turmoil . . . , along with some high-profile lawsuits, has turned a spotlight on mutual funds' pricing, and that has spurred a resurgence in a product that many 401(k) plans had historically neglected: collective investment trusts. That's good news for banks, since CITs must legally have a bank or trust company as a trustee."
(US Banker)

New Jersey Senate Takes on Pension Reform
Excerpt: "If voters approve the ballot question, the state and other public employers would be bound to make one-seventh of their pension contribution in the next fiscal year, and they would be required to increase the contribution by one-seventh every year until the entire portion is being paid in FY2017."

Effort to Return to DB Stalls in Alaska
Excerpt: "Key legislators who control the future of the bills that would bring Alaska state workers back to a traditional defined benefit pension plan haven't moved them from their committees."

Do You Really Want To Be A 401(k) Consultant?
Excerpt: "there are several major changes that will have notable consequences on the retirement plan marketplace. So, it is easy to become discouraged in working in this area. But, true 401(k) consultants see these issues as opportunities rather than obstacles. Those financial advisors who are willing to adapt their practices to service the small- to mid-sized plans may be well positioned to dominate in the marketplace."
(On Wall Street)

CalPERS Pension Fund to Review Assumed Actuarial Rate of Return
Excerpt: "CalPERS, the biggest U.S. public pension fund, will review its assumed actuarial rate of return of 7.75 percent and will make a recommendation to its board whether to lower it in December, a spokesman said on Sunday."
(New York Times; free registration required)

New Fiduciary Considerations for U.S. Public and Private Pension Plan Governance: A Look at New OECD Guidelines
Excerpt: "Updated guidelines for pension fund governance have been approved by the Organisation for Economic Co-operation and Development. Although pension plan governing bodies are not required to adopt these 2009 guidelines, they indicate world trends and may be useful to governing bodies overseeing pension plans across borders."
(Groom Law Group)

Too Many Choices Is Problem That Can Paralyze
Excerpt: "Understanding how we choose could guide employers and policy makers in helping us make better decisions. For example, most of us know that it's a wise decision to save in a 401(k). But studies have shown that if more fund options are offered, fewer people participate. And the highest participation rates are among those employees who are automatically enrolled in their company's 401(k)'s unless they actively choose not to."
(New York Times; free registration required)

California Candidate for Governor Calls for Defined Contribution Accounts for New State Hires
Excerpt: "On pension reform, we need to align public employee retirement benefits to those available in the private sector. New state workers should receive a 401(k)-style defined-contribution plan. For most existing state workers, we need to increase the retirement age from 55 to 65, require longer vesting periods, and ask them to contribute more to their retirement benefits."
(Orange County Register)

Pension Protection Act implementation, fee disclosure proposals, complex correction programs, and more. A never ending stream of regulations and other guidance has been hitting 401(k) practitioners. Need some help keeping up? EBIA’s 401(k) Plans manual analyzes and explains the new developments, puts them in context, and offers practical guidance on how to deal with the constantly shifting environment for 401(k) plans.

Executive Compensation; Benefits in General

Government Mulls Contractor Rules on Wages, Benefits
Excerpt: "Wages and benefits offered by a company could influence whether it is chosen to do work for the federal government under new rules being considered by the Obama administration."
(Workforce Management)

Webcasts and Conferences

"403(b): The Burning Questions" Web Seminar
Nationwide on March 17, 2010
presented by SunGard Relius

COBRA Workshop
in Washington on March 24, 2010
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Frozen Plan Solution - A.I.M. to Exit Webcast
Nationwide on March 2, 2010
presented by Mercer

HIPAA Workshop
in Washington on March 25, 2010
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Making the Most of the New §409A Correction Procedures - Webinar
Nationwide on March 24, 2010
presented by Seyfarth Shaw LLP

New Mental Health Parity Rules: What They Mean to Your Organization Webcast
Nationwide on March 25, 2010
presented by International Foundation of Employee Benefit Plans

U.S. Health Spending Trends: 2009 through 2019 Webcast
Nationwide on March 17, 2010
presented by Society of Actuaries

Press Releases

BAN Smart Partners Meet In San Diego
Benefit Advisors Network

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