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Retirement Plans Newsletter

May 12, 2010

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[Official Guidance]
Text of 2009 Form 5500-EZ: Annual Return of One-Participant Retirement Plan (PDF)
2 pages. Excerpt: "This form is required to be filed under section 6058(a) of the Internal Revenue Code."
(U.S. Internal Revenue Service)

[Guidance Overview]
DOL's Additional Guidance for Multiemployer Retirement Plans (PDF)
4 pages. Excerpt: "The final civil penalty regulations apply to sponsors of multiemployer defined benefit pension plans in endangered status or critical status that fail to adopt a funding improvement plan or rehabilitation plan as required by the Pension Protection Act of 2006."
(Prudential Retirement)

[Guidance Overview]
The 401k Audit: How to Stay Out of the DOL Spotlight (PDF)
10 slides. Excerpt: "Verify [that] the payroll department understands the definition of compensation; Use forfeitures balances and bring the balance to zero at least once a year; Verify employee contributions are remitted ASAP . . . ."
(Salmon Sims Thomas)

[Guidance Overview]
Court Dismisses 401(k) Fee Claims, Rejects DOL View on ERISA 404(c) Protection
Excerpt: "ERISA does not require fiduciaries of even large 401(k) plans 'to get the best deal imaginable' on plan fees, a federal court in Pennsylvania has ruled . . . . Dismissing claims against the plan sponsor and trustee, the court found the plan offered a sufficient mix of 70 funds with fees ranging from 0.1 to 1.21 percent. The court rejected the Labor Department's view of ERISA Section 404(c), finding fiduciaries bear no liability for participants' choices from a broad range of funds . . . ."
(Mercer LLC)

Minnesota Senate Last Week Approved an Omnibus Pension Bill
Excerpt: "An amendment that would place employees hired after July 1 in defined contribution plans, to which employees and the state would contribute, was proposed, but sources from the [Teachers Retirement Association] say the amendment was defeated."

Pensions and Retirement Plan Enactments in 2010 State Legislatures: Preliminary Report
Excerpt: "This is a preliminary version of NCSL's annual report of state pensions and retirement legislation, designed to communicate the great amount of significant retirement legislation states have already enacted in 2010."
(National Conference of State Legislatures)

Retirement Income Adequacy at Large Companies (PDF)
7 pages. Excerpt: "The study assesses projected retirement resources at retirement versus financial needs during retirement, using actual data of more than 2 million employees, real retirement benefit plan designs at 84 large U.S. companies, and current employee savings behavior."
(Hewitt Associates)

Basic Requirements and Best Practices for Today's Plan Sponsors (PDF)
8 pages. Excerpt: "This paper provides guidance to help plan sponsors understand their role as a fiduciary, [and] highlights strategies to minimize fiduciary and compliance risk . . . ."

2010 403(b) Plan Survey Highlights
Excerpt: "11.5 percent of plans have an automatic enrollment feature. . . . 43.5 percent of plans with automatic enrollment have a default deferral of 3 percent of pay and 19.6 percent have a default deferral of 2 percent of pay."
(Profit Sharing / 401k Council of America)

Value of Assets in Multiemployer Plans Dropped an Average of 22.1% from the Beginning of 2008 to 2009
Excerpt: ". . . The National Coordinating Committee for Multiemployer Plans (TNCCMP) argued that its members had suffered every bit as much as other pension programs from the economic downturn and need Congressional funding relief as much as other pension plans."

Recession no Hindrance to 403(b) Transformation, According to Survey
Excerpt: ". . . 56.8% of plan sponsors made changes to their plans because of new regulations . . . ."

Defined Contribution Institutional Investment Association's Response to IRS Request for Information on Lifetime Income Options in DC Plans
24 pages. Excerpt: "An important first step is for the entire retirement industry to begin to communicate accumulated retirement values in retirement income terms, e.g., how much lifetime income will a given level of savings produce?"
(Defined Contribution Institutional Investment Association)

Defined Contribution Institutional Investment Association's Comments on Proposed Regulation of Investment Advice to Plan Participants
5 pages. Excerpt: "Plan participants benefit from plan sponsors providing fiduciary oversight of plan economics, and being knowledgeable about the breakdown of all plan costs and sources of revenue, including but not limited to investment management, record keeping and other administrative expenses."
(Defined Contribution Institutional Investment Association)

Investment Company Institute Response to RFI on Lifetime Income Options (PDF)
31 pages.
(Investment Company Institute)

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Executive Compensation; Benefits in General

[Official Guidance]
What Should Be On 2010-11 Guidance Priority List? IRS Wants to Know (PDF)
4 pages. Excerpt: "[T]he Guidance Priority List [is used] each year to identify and prioritize the tax issues that should be addressed through regulations, revenue rulings, revenue procedures, notices, and other published administrative guidance."
(Internal Revenue Service)

Federal Government's Office of Personnel Management's Workplace Flexibility Program Will Start in June
Excerpt: ". . . [N]early 400 OPM employees from a range of job functions will be permitted to work wherever and whenever they choose as long as their work gets done."

Webcasts and Conferences

23rd Annual Flexible Benefits Administrators' Symposium
in California on August 4, 2010
presented by Employers Council on Flexible Compensation (ECFC)

Advanced Roth IRA Conversion Issues and Strategies Webcast
Nationwide on May 13, 2010
presented by CCH, a Wolters Kluwer business

After the Fall: The Role of Investment Advice in Retirement Recovery
in California on May 20, 2010
presented by Western Pension & Benefits Conference - Orange County Chapter

Compliance Basics and More Workshop
in Alabama on June 10, 2010
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

How to Amend 401(k) Plans to Increase Employees' Retirement Income
in Maryland on June 3, 2010
presented by Worldwide Employee Benefits Network -- Baltimore chapter

Northeast Area Benefits Conference
in Massachusetts on July 12, 2010
presented by American Society of Pension Professionals & Actuaries (ASPPA)

Northeast Area Benefits Conference
in New York on July 13, 2010
presented by American Society of Pension Professionals & Actuaries (ASPPA)

Press Releases

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