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PBGC's Premium Payment Instructions for 2011 Plan Years, Including Illustrative Forms
Excerpt: "The premium payment instructions (including illustrative forms) for both Estimated Flat-rate Filings and Comprehensive Filings for plan year 2011 are posted . . . to the Premium Payment Instructions and Addresses page of our website. My Plan Administration Account . . . is expected to be ready for 2011 premium filings to be prepared and submitted by mid January 2011."
(Pension Benefit Guaranty Corporation)
Text of Rev. Rul. 2011-1: Commingling of Retirement Assets in Group Trusts (PDF)
17 pages. Excerpt: "This revenue ruling modifies the rules for group trusts described in Rev. Rul. 81-100 . . . . The modifications revise the generally applicable rules for these group trusts and, if certain requirements are met, permit the participation in group trusts of custodial accounts under § 403(b)(7), retirement income accounts under § 403(b)(9), and governmental retiree benefit plans under § 401(a)(24)."
(U.S. Internal Revenue Service)
New DOL Proposed Regulations Require Additional Disclosures for QDIAs and Target Date Retirement Funds (PDF)
4 pages. Excerpt: "Part I of this Client Alert provides historical background regarding target date retirement funds and why the DOL believes additional rulemaking in this area is necessary, part II provides an overview of the proposed regulation's requirements and compares them to similar proposed regulations issued by the Securities and Exchange Commission . . ., and part III recommends actions plan fiduciaries should take now in light of the proposed regulations."
(Paul, Hastings, Janofsky & Walker LLP)
Cash Balance Plan Regulations Address Complicated Issues
Excerpt: "Together, the regulations interpret the primary changes made by PPA related to: general age discrimination rules, market-rate-of-return limits for interest credits, anti-wear-away protections for plan conversions, three-year vesting, and elimination of whipsaw and other distribution valuation rules."
(Groom Law Group via The Bureau of National Affairs, Inc.)
IRS Clarification of Taxation of In-Plan Roth 401(k) Rollovers
Excerpt: "In the newly issued formal guidance, the IRS illustrates the applicable tax treatment of rollovers and subsequent distributions from Roth accounts and provides for retroactive plan amendments implementing the rollovers."
DOL's Proposed Funding Notice Regulations (PDF)
5 pages. Excerpt: "Generally, sponsors of single employer DB plans covered by ERISA must provide the notice. The proposal provides a special rule in the case of a merger or consolidation of two or more plans. In such circumstances, the plan administrator of the plan that has legally transferred control of its assets to a successor plan is not required to provide the notice for its final plan year. The notice provided by the successor plan for that year generally must include information for affected employees."
More Explicit Disclosures Are Proposed for Target Date Funds
Excerpt: "[DOL] is proposing that additional disclosures be provided when target date retirement funds . . . are offered in participant-directed individual account plans. If adopted, the rule would require that participants be provided with an explanation of how the fund's asset allocation changes over time, the point at which the allocation becomes it's most conservative, and - if the fund is described with reference to a specific date - the significance of the date."
(Deloitte via BenefitsLink.com)
Traditional IRA Investors' Rollover Activity, 2007 and 2008 (PDF)
64 pages. Excerpt: "By tapping account-level records, research drawn from this database can provide new and important insights into IRA investor demographics, activities, and asset allocation decisions. The database is designed to shed light on key determinants of IRA contributions, rollover and withdrawal activity, and the types of assets that investors hold in these accounts."
(Investment Company Institute)
Foreign Work Experience Raises Retirement and Tax Issues
Excerpt: "The primary difficulty with having foreign employees participate in a U.S. retirement plan involves the payment of benefits when they return to their home country."
(Employee Benefit News; one-time free registration required)
Virginia Governor Says State Employees Should Pay 5 Percent of Salary Toward Retirement Benefits
Excerpt: "The system, which provides pensions and other benefits to retired government workers, has a future unfunded liability of $17.6 bil.lion, according to a report released this week by the Joint Legislative Audit and Review Commission, the General Assembly's oversight agency. That leaves all five of the system's pension plans underfunded by more than 25 percent, each exceeding the generally accepted benchmark of 20 percent."
(Daily Press Media Group)
Study Calculates High Cost of Changing the Nevada Public Employees Retirement System
Excerpt: "Switching how the Public Employees Retirement System of Nevada is funded would cost public employers and employees an additional $1.2 bil.lion over the next two years, a study by a Chicago consulting firm has found. But in the long run -- about 20 years -- a defined-contribution plan would be less costly than the current system, a consulting firm official said in response to questions."
(Las Vegas Review-Journal)
401(k) Changes Should Give Savers a Brighter Future
Excerpt: "[W]hat were some of the best (and worst) changes that were made to 401(k) plans in 2010 for the benefit of workers and what sort of changes should be made in 2011? Here's what experts had to say."
Could You Retire Without Social Security?
Excerpt: "If your Social Security payments are scaled back, or worse, what would it cost you to buy something similar in the private sector? We can do some math. According to ImmediateAnnuities.com, a 66-year-old man would have to pay $128,000 for an annuity providing him with income of $10,000 for life. A 66-year-old woman would have to pay even more, about $138,000. That's for an income of $10,000 a year. If you think you'll need $40,000 a year to live on, naturally you'd need to set aside four times as much, or about $550,000."
(The Wall Street Journal)
Illinois Must Face Additional Pension Reforms
Excerpt: "This year the General Assembly took a good first step by making significant changes to the pensions earned by employees hired after Jan. 1, 2011. These changes for future employees will increase the retirement age to 67, cap the maximum retirement benefit and tie cost-of-living increases to the consumer price index, among other reforms. These changes will save Illinois more than $70 bil.lion in pension contributions over the next 35 years. But that's not enough."
New rules from the IRS require paid tax preparers to obtain a PTIN, as well as either meet broad competency requirements or become an Enrolled Retirement Plan Agent (ERPA). We can help you become an ERPA with our incredible tools, practice exams and study aids. Register now and order your materials. The exam window is January 6-February 17, 2011!
For more information and study aids, visit AIRE, LLC. To register for the exam, visit ERPA Exam
Benefits in General; Executive Compensation
After Two Years of Decline IRS Increases Standard Mileage Rates
Excerpt: "The increase for 2011 follows two earlier years of decline, in 2009 and 2010. The Notice also includes a request for comments on whether taxpayers should be permitted to use the business standard mileage rate for automobiles used in fleet operations."
(Deloitte via BenefitsLink.com)
Loans to Executives Get More Attention from IRS
Excerpt: "In its work plan for fiscal year 2011, the IRS Exempt Organizations unit discussed the results of its 2004 executive compensation project, released in 2007, in which it found improper reporting and excess benefits in a significant number of instances that, the IRS said, raised concerns about substantial loans to officers, directors, trustees, and key employees."
(Tax Management Inc.)
Labor-Relations Strategies to Cut Benefits Costs
Excerpt: "In the last Governing Management letter, I outlined several key policy strategies for elected officials to pursue in their quest to reform public retirement systems. Before the New Year begins, it's time for public managers to set their strategies for achieving these policy objectives and mitigating the ever-rising costs of retirement plan benefits. This column provides a roadmap."
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