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Retirement Plans Newsletter

October 11, 2010

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[Official Guidance]
Text of IRS Employee Plans News, October 8, 2010 Edition
The edition includes articles on 2010 Rollovers and Conversions to a Roth IRA; Self-employed? How to calculate plan contributions for yourself; Waiver for 60-day Rollover; Form 5500 Filing Tips; Free Material on New Outreach Corner on; National Save for Retirement Week (October 17-23); Critical Priorities...with Monika Templeman; DOL Corner; PBGC Insights; and, Calendar of EP Benefits Conferences.
(U.S. Internal Revenue Service)

[Guidance Overview]
Roth Conversions for 2010 Require Immediate Action by Plan Sponsors of Defined Contribution Plans
Excerpt: "These new rules are effective immediately, and if the plan is amended now to permit in-plan rollovers, participants can take advantage of the special tax rules which allow tax due on 2010 rollovers to be deferred into 2011 and 2012."
(Troutman Sanders LLP)

[Guidance Overview]
Summary Judgment Granted for Defendant in Certified Deferred Annuity Class Action (PDF)
2 pages. Excerpt: "The majority of the court's decision focused on [Plaintiff's] failure to establish a triable issues as to whether Defendant engaged in a pattern of racketeering activity . . . ."
(Sutherland Asbill & Brennan LLP)

[Guidance Overview]
National City Corporation Settles ERISA Suit for $43M
Excerpt: "The settlement . . . will provide for a payment of $43 mil.lion to the plan . . . which will then be allocated to the accounts of all current and former participants and beneficiaries of the National City Savings and Investment Plan who had portions of their plan accounts invested in National City common stock or fund units in the National City Stock Fund at any time during the period September 5, 2006, to December 31, 2008, and to Plan participants who held mutual funds of Allegiant Asset Management Company in their Plan accounts at any time from March 25, 2002, to December 31, 2009."

Weighing Retirement Calculator Options
Excerpt: "Experts say coming up with an exact retirement nest egg is very difficult considering all of the variables needing to be combined. And while retirement calculators are giving many users a good start in figuring out their financial needs, several experts say these programs need to better address key planning issues."
(Workforce Management; free registration required)

Retirement Prospects Among State and Local Government Workers: The 2010 Public Sector Retirement Confidence Survey
Excerpt: "Compared with U.S. workers in general, public sector employees tend to be more confident that they will have enough money to live comfortably throughout retirement."
(TIAA-CREF Institute)

ASPPA Request that IRS Clarify/Limit Tax Return Preparer Registration for Form 5500 Preparers
Excerpt: "[Form] 5500 is primarily an information return for employee benefit plans and that the data collected, for the most part, has little or no impact on an actual tax return. It is critical that support staff that only input data relating to Form 5500 preparation but do not exercise 'discretion or independent judgment be excluded from the new registration and the Circular 230 process,'"
(Wolters Kluwer)

Raising the Retirement Age for Social Security, October 2010; Updates an October 2002 Issue Brief (PDF)
8 pages. Excerpt: "Under current law, once the NRA reaches age 67 in 2027, increases in longevity will translate into higher lifetime Social Security benefits . . . ."
(American Academy of Actuaries)

Audio and Transcript: A Discussion on Public Pension Plans held on the Diane Rehm Show
Guests on the October 7, 2010, show were Leigh Snell with the National Council on Teacher Retirement, David John with The Heritage Foundation, Norman Stein professor of law at Drexel University, and Tom Shoop of Government Executive Magazine.
(WAMU 88.5 American University Radio)

Book: Reorienting Retirement Risk Management
Excerpt: "This volume explores how workers and firms can reassess the risks associated with retirement saving and dissaving to identify creative adjustments to adapt to these new risks and realities."
(Pension Research Council)

Wal-Mart to End Employee Profit-Sharing
Excerpt: "Wal-Mart Stores Inc., the largest U.S. private employer, plans to end profit-sharing contributions in February, replacing them with matches to employee 401(k) retirement plans to bring down benefits costs."

Why California Is Wrong to Believe That Our Pension Problems Will Be Solved by a Move to Defined Contribution Plans
Excerpt: "[I]n California and many states around the country public employees do not enjoy the same protections that private employees receive when it comes to Defined Contribution plans (403(b) and 457(b)). Government defined contribution plans are not governed by the same laws, namely ERISA that private plans are."
(The Teachers Advocate)

American Benefits Council Letter to Treasury on Need for Immediate Guidance on In-Plan Roth Conversions (PDF)
4 pages. Excerpt: "[W]e thought it would be helpful to provide for you a detailed list of the issues being raised with the American Benefits Council."
(American Benefits Council)

Request for Extension of Filing Deadline of Form 5500 / 5500-SF (PDF)
4 pages. The request is based on issues with new technology, new regulations, and a possible benefit to both DOL and the IRS.
(American Institute of Certified Public Accountants)

The Source, Second Edition by Kristi Cook, JD and Ellie Lowder, includes the final 403(b) regulations, their impact and practical suggestions on how plan sponsors can manage their 403(b) program in compliance with applicable IRS requirements and deadlines. It also covers all aspects of ERISA and non-ERISA retirement plans for public education and tax-exempt 501(c)3 employers and includes comprehensive technical information with explanations and citations of relevant Code Sections.

Required reading for ASPPA's TGPC credential! Order yours today!

Sponsored by ASPPA

Benefits in General; Executive Compensation

[Guidance Overview]
IRS Transition Relief Presents Opportunity to Correct 409A Document Errors Prior to Year-End
Excerpt: "Corrections made by December 31, 2010, will, in most instances, allow employees to avoid recognizing additional taxable income and taxes under Section 409A that generally will apply after 2010."
(Wilson Sonsini Goodrich & Rosati)

[Guidance Overview]
IRS Sets 2011 Blended Meals and Incidental Expenses Rates for Transportation Industry
Excerpt: "The blended M&IE rates are available to employers directly involved in moving people or goods . . . . They provide a level at which employers in the transportation industry may reimburse their employees for expenses. Employers whose employees travel frequently also may use the rates. They are intended to simplify recordkeeping for such employers, since their employees may travel during a single payroll period to many locations with different M&IE rates."
(Thompson Publishing Group Inc.)

Mandated Clawbacks Will Create New Tensions Between Executives and Boards
Excerpt: "Virtually all publicly traded companies must rewrite their clawback provisions, many of which were developed in response to the Sarbanes-Oxley Act (SOX) but don't go as far as required by Dodd-Frank. Where previous law called for clawbacks after 'acts of commission' by executives, the new law mandates clawbacks from executive officers regardless of whether the acts that led to the restatement were within their control."
(Towers Watson)

SHRM Working on 'Cost Per Hire' Metric
Excerpt: "[A report] said a draft standard is now being reviewed by members of SHRM's Staffing and Workforce committee and will then be submitted to the American National Standards Institute where it can be deemed official."

Tennessee High Court Denies Benefits for Widow of Murdered Employee
Excerpt: "The Supreme Court of Tennessee has denied a claim for workers' compensation benefits by the widow of an employee whose murder at his workplace is unsolved. The state's high court agreed with lower court decisions that the employee's death was the result of a neutral assault and that the 'street risk' doctrine was inapplicable because the employer's premises were not open to the public."

LEGO Earns Kudos from Working Moms
Excerpt: "For the sixth straight year, Enfield-based LEGO Systems has made the 'Working Mother Magazine 100 Best Companies' list. The company has been recognized for its high approval rating among employees, generous family leave and flexible working conditions."
( LLC)

Wellness Programs and Employee Ownership
Wellness programs can significantly reduce health care costs while improving employee well-being, commitment, and productivity. While there are many variations on these programs, several key practices have emerged. There are also legal requirements for these programs. This issue brief features articles by leading experts on these issues as well as several detailed ESOP company case studies. The Web page for the brief features a lengthy excerpt to read.
(National Center for Employee Ownership)

Webcasts and Conferences

Health Care Reform: A Six Month Check-up
Nationwide on October 28, 2010
presented by International Foundation of Employee Benefit Plans

Multiemployer Plan Attorneys - 2010 Pension Relief Act Guidance and Valuable Approaches
Nationwide on October 21, 2010
presented by International Foundation of Employee Benefit Plans

Press Releases

October Declared National Renewable Energy 401(k) Month
The Renewable Energy Initiative (TREI)

Newly Posted Employee Benefits Jobs

Participant Service Center Supervisor
for New York Life
in MA

Assistant Director (Member Services Call Center)
for 1199SEIU Benefit and Pension Funds
in NY

Regional Director of Account Management
for Corporate Synergies Group, Inc.
in MD

DB/DC Pension Analyst
for Boyce & Associates, Inc.
in AZ

Business Development Officer
for Hancock Bank
in AL

Sr. Consultant/Project Leader-Strategic Planning
for Transamerica Retirement Services
in CA

Client Service Manager - Richfield, OH
for Charles Schwab
in OH

Senior Plan Consultant
for Scholz, Klein & Friends Enlightened Retirement Group, Inc.
in TX

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