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Retirement Plans Newsletter

November 19, 2010

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Pension Reporter System. Easy to use PC based software for EFAST2 electronic filing. Full instructions and expert support. Choose from 4 modules:
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  • 1099-R Series: with related forms and 1099 electronic filing/Service Bureau
  • Qualification & Termination: 5300/5310-series and PBGC 500/600-series forms
  • FAS 132/158: Audit Letter, Worksheets, Schedules
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[Official Guidance]
DOL Model Annual Funding Notice: Multiemployer Plan
The plan must report how well it is funded by using a measure called the 'funded percentage."
(U.S. Department of Labor via American Benefits Council)

[Official Guidance]
DOL Model Annual Funding Notice: Single-Employer Plan
Plans must report how well funded by using a measure called the 'funding target attainment percentage."
(U.S. Department of Labor via American Benefits Council)

[Official Guidance]
DOL Fact Sheet Regarding Annual Funding Notice for Defined Benefit Plans Rule (PDF)
2 pages. Excerpt: "The proposal requires administrators of all defined benefit plans subject to Title IV of ERISA to furnish a funding notice each year. The recipients are the Pension Benefit Guaranty Corporation (PBGC), each plan participant and beneficiary, each labor organization representing such participants or beneficiaries, and, in the case of a multiemployer plan, each employer that has an obligation to contribute to the plan."
(U.S. Department of Labor via American Benefits Council)

[Guidance Overview]
IRS Handout for the Hybrid Plan Regulations Phone Forum Presentation (PDF)
36 pages. The forum will be held November 23, 2010.
(U.S. Internal Revenue Service)

[Guidance Overview]
DOL's Final Rules for Participant Fee Disclosures (PDF)
16 pages. Comprehensive 16-page overview in a useful question-and-answer format. Includes list of 'action items' for plan sponsors and for service-providers, the model comparative chart issued by the DOL, and a sample chart 'drafted to provide a template that might be used to comply with the plan-related fee disclosure."
(Kelly, Hannaford & Battles P.A.)

Multiemployer Gap Drives Up PBGC's Deficit
Excerpt: "The [PBGC] said its deficit increased to $23 bil.lion at the end of fiscal 2010, a 5% increase over the $22 bil.lion deficit recorded in 2009, and more than half of that increase was attributed to a growing gap in multiemployer plans . . . ."
(American Institute of Certified Public Accountants)

Distributional Effects of Price Indexing Social Security Benefits
Excerpt: "This policy brief compares five options (four progressive price indexing and one full price indexing option) set forth by the Social Security Advisory Board to index initial benefits to price growth. It examines the distribution of benefits of Social Security beneficiaries aged 62 or older in 2030, 2050, and 2070 using Modeling Income in the Near Term (MINT) model projections."
(U.S. Social Security Administration)

Quantitative Easing, or Pension Squeezing? How the Fed's Actions Could Boost Corporate Retirement Plan Costs
Excerpt: "[I]f pumping money into the economy fulfills the Fed's goal of lowering long-term interest rates, that could force sponsors of defined-benefit plans to record higher pension costs on their income statements at the end of this year, benefit consultants say."
(CFO.com)

What is the Impact of Foreclosures on Retirement Security? (PDF)
24 pages. Excerpt: "Using data from several sources, we show that households nearing retirement have lower rates of housing distress than younger households, as measured by arrears and foreclosure rates."
(Center for Retirement Research at Boston College)

New Nevada State Senate Minority Leader Urges Funding Changes to Public Pension System
Excerpt: "Largely because of a stock market crash in 2007 and other declines over the past decade, PERS' investment earnings have fallen short of expectations. The agency faces an unfunded liability estimated at $10 bil.lion as of June 30. To cover all current and future pensions, PERS eventually needs to increase its investment income or have employees and state and local governments contribute additional revenue."
(Las Vegas Review-Journal)

The Golden Age of The Big Pension Check Is a Myth
Excerpt: "Old-style pensions didn't benefit as many people as you'd think. Social Security has been the basis of retirement security all along."
(Financial Planning)

[Opinion]
No Tax Deferral for 401(k) or Other Employer Sponsored DC plans?
Excerpt: "There are significant consequences if the tax preferences for employer sponsored defined contribution plans are eliminated as suggested by the leaders of both the President's Deficit Commission (Simpson/Bowles), and the Bipartisan Policy Center's deficit reduction team (Rivlin/Domenici) . . . ."
(Profit Sharing / 401k Council of America)

[Opinion]
American Benefits Council/CIEBA Comments to SEC Regarding Proposed Rule Defining 'Family Offices' (PDF)
Excerpt: "Specifically, we ask the Commission to clarify that a family office otherwise exempt from registration under the rule, or an individual employee or officer of such a family office, will not be required to register as an investment adviser merely by reason of advising an employee benefit plan sponsored by the family office for its own employees."
(American Benefits Council)




Itís a whole new world at the 2011 NTSAA Annual Conference, the premier 403(b) and 457 forum for educating producers, providers, agents, broker/dealers, sales and marketing managers, office staff, plan sponsors and other business officials. Register now and join your colleagues in Orlando February 2-5, 2011.

For more information and a brochure, go to www.asppa.org/ntsaaconference

Sponsored by NTSAA

Benefits in General; Executive Compensation

[Guidance Overview]
2nd Circuit Rules that Companies May Not Indemnify Executives for SOX 304 'Clawback' Liability
Excerpt: "Although the facts in the case involved an indemnification provision in a settlement agreement, the logic of the ruling could extend to indemnification provisions in companies' charter documents and in directors' and officers' liability insurance policies as well."
(McGuireWoods LLP)

[Guidance Overview]
Reminder: Reporting Required for Exercise of ISOs, ESPP Options (PDF)
1 page. Excerpt: "The end is near for a temporary reprieve from reporting exercises of incentive stock options ('ISOs') and options under employee stock purchase plans ('ESPP'). On November 6, 2010, the Internal Revenue Service released final versions of Form 3921 and 3922 on which employers are required to report information relating to the exercise of ISOs and ESPP options."
(Vorys, Sater, Seymour and Pease LLP)

[Guidance Overview]
Widow Loses SERP Benefits Bid
Excerpt: "'The definition of 'spouse' contained in the SERP, on a plain reading, does not apply to Plaintiff. She was not married to Mr. Parr at the time of his retirement and is therefore not entitled to the death benefits as a spouse under the terms of the plan,' Oliver declared in the ruling."
(PLANSPONSOR.com)

House Sends Federal Telework Bill to Obama
Excerpt: "Members voted 254-152 to pass the 2010 Telework Enhancement Act (H.R. 1722), which requires agencies to determine which employees are eligible to work outside the office, to establish policies allowing them to do so and to inform them of the option."
(Government Executive)

Major League Baseball Close to Expanding Pension Benefits
Excerpt: "Major League Baseball and the players' union are close to an agreement that would close one of the few cracks in baseball's pension plan, providing life annuities and possibly medical coverage for about 870 players who played in the major leagues before 1980 but fell short of the four years' requirement for eligibility."
(Chicago Tribune)

[Opinion]
Frederic W. Cook Comments on Shareholder Approval of Executive Compensation and Golden Parachute Arrangements (PDF)
8 pages. Excerpt: "This letter sets forth the comments of Frederic W. Cook & Co., Inc. with respect to the proposed rules. Our comments are primarily in the form of responses to seven of the SEC's Requests for Comments. In addition, we have included one additional comment at the end of this letter."
(Frederic W. Cook & Co., Inc.)


Webcasts and Conferences

401(k) Rekon Advisor Symposium Atlanta
in Georgia on December 14, 2010
presented by 401(k) Rekon

401(k) Rekon Advisor Symposium Bridgewater
in New Jersey on December 2, 2010
presented by 401(k) Rekon

401(k) Rekon Advisor Symposium Chicago
in Illinois on December 9, 2010
presented by 401(k) Rekon

401(k) Rekon Advisor Symposium Phoenix
in Arizona on December 7, 2010
presented by 401(k) Rekon

Advanced COBRA Compliance: Preventing, Catching, and Correcting Mistakes
Nationwide on November 18, 2010
presented by EBIA / Thomson Reuters

Election Results-Practical Implications for Benefit Plans
in New York on December 7, 2010
presented by WEB (Worldwide Employee Benefits Network ), New York Chapter

Health Reform Act: What Employers Need to Know Webcast
Nationwide on December 8, 2010
presented by Reish and Reicher


Press Releases

US Labor Department Proposes Rule to Implement Annual Funding Notice Requirement for Pension Plans
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

New Prague Man Indicted for Embezzling Funds from an Employee Benefit Plan
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)


Newly Posted Employee Benefits Jobs

Relationship Manager
for The Standard
in OR

Retirement Plans Account Manager
for Employee Benefits Consulting Firm
in NY

Participant Service Center Representative
for New York Life Retirement Plan Services
in MA, NJ

Account Manager
for Lincoln Financial Group
in IL, IN

Client Service Professional
for Professional Capital Services, LLC
in PA




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