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Retirement Plans Newsletter

August 27, 2010

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[Guidance Overview]
IRS Handout on Abusive Tax Avoidance Transactions and Emerging Issues Presentation (PDF)
17 pages. Excerpt: "The [August 27, 2010 phone] Forum will focus on potential abusive schemes and new emerging issues including insurance funded plans, schemes involving defined benefit pension plans, S Corporation ESOP abuses, ROBS compliance issues, reversion and distribution schemes, management company promotions, abuses involving union plans and other issues of concern. IRS EP will also discuss strategies to proactively detect and deter abuse, including the use of Promoter Investigations."
(U.S. Internal Revenue Service)

[Guidance Overview]
On the Subject of Being a Non-ERISA 403(b)
Excerpt: "Since the final 403(b) regulations in July of 2007, there have been questions about how a non-ERISA 403(b) arrangement may maintain the status of being exempt from ERISA. This article addresses that issue."
(McKay Hochman Co.)

[Guidance Overview]
Overview for Plan Sponsors and Fiduciaries of New Requirements for Service Provider Arrangements
Excerpt: "The regulations impose information disclosure requirements on providers of certain types of services to certain types of ERISA plans. The regulations also explain what are reasonable termination provisions for services contracts."
(McGuireWoods LLP)

[Guidance Overview]
September Deadline Set for Refiling Pension Overpayment Suit
Excerpt: "[The U.S. District Court] ordered that if a new suit against [the defendant] is not filed under [ERISA] by that date, [the court's] order throwing out ING's original case filed under Illinois state law will become permanent. The court ruled that the state law claims against Barrington in the original suit would be pre-empted by ERISA."

[Guidance Overview]
Court Orders Rehired Lucent Technologies Employee Readmitted to DB Plan
Excerpt: "[A U.S. District] ruled that committee members had ignored a section of the plan documents for the Lucent Retirement Income Plan . . . allowing such re-entry to the service-based DB program if Lucent rehired a temporarily laid-off employee within three years."

Text of Agenda for September 14-15 Joint Hearing on Lifetime Income Options for Retirement Plans (PDF)
2 pages. A live webcast of the hearing will be available on EBSA's Web site.
(U.S. Employee Benefits Security Administration)

Lifetime Income Options for Retirement Plans Hearing Agenda Unveiled
Excerpt: "The hearing was designed to hear testimony regarding: certain participant concerns affecting the choice of lifetime income relative to other options; information to help participants make choices on the management and spend down of retirement benefits; disclosure of account balances as monthly income streams; the fiduciary safe harbor for selection of lifetime income issuers or products; and alternative designs of in-plan and distribution lifetime income options."

FASB Proposed Accounting Standards Update Re: DC Plan Loans (PDF)
16 pages. Comments due by September 7, 2010.
(FASB via The SPARK Institute)

19% Decline in U.S. Retirement Benefits Seen Over 10 Years
Excerpt: "According to Towers Watson's industry-specific analysis -- including defined benefit (DB) and defined contribution (DC) plans, as well as retiree medical and life insurance plans -- the value, as measured by percentage of pay, of total retirement benefits for U.S. workers dropped 19% between 1998 and 2008."
(Towers Watson)

States Watching Minnesota Pension Lawsuit
Excerpt: "A legal battle in Minnesota next month will test the ability of states to change benefits of current retirees. The outcome could prompt other cash-strapped states to follow suit or grind a fleeting movement to a sharp halt."
(Franklin Center for Government & Public Integrity)

Retirement Industry Acronyms and Abbreviations
Excerpt: "Like many industries, the retirement profession is acronym and abbreviation crazy. [] compiled this list of the more common acronyms and abbreviations to help those who are not familiar with their meaning."
(, LLC)

Caterpillar to Move Non-Union Workers to 401(k) Plan
Excerpt: "Caterpillar Inc. . . . will switch more than half its 50,000 U.S. employees to 401(k) accounts from defined benefit plans to save the company money."
(Pensions & Investments; registration may be required)

Public Pensions and Our Fiscal Future
Excerpt: "Few Californians in the private sector have $1 million in savings, but that's effectively the retirement account [guaranteed] to many government employees."
(Arnold Schwarzenegger via The Wall Street Journal)

Pension Time Bomb: The Shadow Hanging Over GM's Turnaround
Excerpt: "The net effect is that the pension time bomb is still ticking. If GM earns robust profits, . . . the bomb won't detonate. Otherwise -- well, in a worst-case scenario, GM winds up back in bankrup.tcy, with PBGC intervention both unavoidable and more expensive than it would have been last year. And that could necessitate a bailout from Congress, because of the PBGC's own deficits. "
(The Washington Post; free registration required)

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Benefits in General; Executive Compensation

SEC Adopts Proxy Access Rules
Excerpt: "[on August 25, 2010], the SEC adopted proxy access rules at an open Commission meeting by a 3-2 vote and posted its 451-page adopting release. Neither the adopting release nor Proxy Access generally has an automatic or direct impact on executive compensation."
(Michael Melbinger via Winston & Strawn LLP)

Webcasts and Conferences

"401(k) Plans: What Every Practitioner Should Know" - Dallas
in Texas on September 29, 2010
presented by SunGard Relius

"401(k) Plans: What Every Practitioner Should Know" - Des Moines
in Iowa on September 27, 2010
presented by SunGard Relius

"403(b) Plan Design Workshop" - Chicago
in Illinois on October 1, 2010
presented by SunGard Relius

"403(b) Plan Design Workshop" - Kansas City
in Kansas on September 30, 2010
presented by SunGard Relius

"Cross-tested/Safe Harbor 401(k) Plan Design Workshop" - Chicago
in Illinois on September 30, 2010
presented by SunGard Relius

"Cross-tested/Safe Harbor 401(k) Plan Design Workshop" - Cincinnati
in Ohio on September 29, 2010
presented by SunGard Relius

"Cross-tested/Safe Harbor 401(k) Plan Design Workshop" - Kansas City
in Kansas on September 29, 2010
presented by SunGard Relius

Webinar: Questions Your Healthcare Vendor Doesn't Want You to Ask
Nationwide on August 31, 2010
presented by Optimatum Group LLC

Press Releases

U.S. Labor Department Sues Tampa Bay, Florida, Construction Contractor to Recover 401(k) Savings Plan Losses
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

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