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January 13, 2011 Health & Welfare Plans Newsletter  |  Advertise  |  Unsubscribe

[Official Guidance]
Text of IRS Retirement News for Employers, January 12, 2011, Special Edition (PDF) – 2 pages. This edition covers: Qualified Charitable Distributions for 2010 and 2011 and New Requirements for Tax Return Preparers. (U.S. Internal Revenue Service)

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[Official Guidance]
Text of EBSA Notice of Hearing and Extension of Comment Period on Definition of 'Fiduciary'' – "Since publication in the Federal Register, there has been considerable interest expressed in the proposed rule and its impact on various segments of the employee benefits and financial communities, as well as individuals and organizations involved with appraisals of employer stock and other assets. In order to ensure that all issues are fully considered and interested persons have sufficient time to share their views on this important regulation, EBSA has announced that it is extending the period for submitting comments on the proposal until February 3, 2011, two weeks after the close of the January 20, 2011 comment period provided in the proposed regulation, and it is holding a public hearing, the subject of this notice." (U.S. Employee Benefits Security Administration)

[Guidance Overview]
2011 Key Administrative Dates and Deadlines for Calendar-Year Defined Benefit Retirement Plans (PDF) – 6 pages. This information is for plans subject to ERISA and the Internal Revenue Code. (Milliman, Inc.)

[Guidance Overview]
Plan Administrators Should Prepare Now to Comply with New Participant Disclosure Requirements – "Plan administrators of covered plans will need to give participants an expanded array of information that meets specific content, formatting and frequency requirements. The requirements apply to plan years beginning on or after November 1, 2011." (McGuireWoods LLP)

[Guidance Overview]
PBGC Semiannual Regulatory Agenda Addresses Reportable Events, Cash Balance Plans, Missing Participants – "The [PBGC] has released its semiannual regulatory agenda for Fall 2010, which outlines regulations that have been selected for amendment during the next year, as well as long-term actions." (Wolters Kluwer)

Retirees Under Consume Their Assets, According to Study – " In 'The Drawdown of Personal Retirement Assets' NBER Working Paper No. 16675, Professors James M. Poterba, Steven F. Venti, David A. Wise report their study which shows how current retired households are drawing down their retirement assets from personal retirement accounts like 401(k)s and IRAs (PRAs)." (Profit Sharing / 401k Council of America)

Research Memorandum: The Public Employee Pension Transparency Act (PDF) – 5 pages. "If passed, it would require sponsors of State and local government employee pension plans to annually report specific financial information to the Secretary of the U.S. Treasury. Governments failing to report this information would lose their ability to issue tax-exempt bonds until they comply with the reporting requirements. However, the legislation also states that it does not alter the existing funding standards for State and local governments or require Federal funding standards for such plans." (Gabriel Roeder Smith & Company)

EBSA Semiannual Regulatory Agenda Addresses Lifetime Income Option, Fiduciary Rules – "[EBSA] has released its semiannual regulatory agenda for Fall 2010, which outlines regulations that have been selected for review or development during the next year." (Wolters Kluwer)

Investor Comprehension and Usage of Target-Date Funds: 2010 Survey (PDF) – 16 pages. "The survey finds that investors who are aware of target-date funds generally possess a solid understanding of the basic design of TDFs, as well as the investment risk involved. These investors also report sound reasoning in their decision-making as it pertains to TDFs and their overall retirement portfolio. We found that a significant number of TDF investors in employer-sponsored plans are 'unaware': they had never heard of such funds. Unaware investors are presumably uninformed about TDFs, but there is no basis for assuming they are misinformed." (The Vanguard Group)

Letter to the Editor of the Wall Street Journal from NCTR's Executive Director (PDF) – 1 page. The letter is written in response to New York City school's Chancellor Joe Klein's Essay on Pension Funds. (National Council on Teacher Retirement)

2011 Could Have Pension Contribution Surprises – "This post highlights several items that plan sponsors should be aware of as they gear up for their 2011 pension funding valuations. These changes, which could increase minimum required contributions, include . . . ." (Van Iwaarden Associates)

SPARK Institute Comment Letter to EBSA Re: Target Date Fund Disclosure Rule (PDF) – 7 pages. "Although it appears that EBSA's goal is for participants to receive simple and understandable information, we are very concerned that the disclosure requirement includes the subjective qualitative standard that the chart, table or illustration does not obscure or impede a participant's understanding of the other disclosures. We believe that the standard is too subjective, is vague and is subject to very different interpretations." (The SPARK Institute)

Rethinking the Public-Pension Punching Bag – "Reforming won't be easy. The harsh fiscal reality is that in most cases, public pension obligations in states and cities can't be changed for existing workers. Those workers will continue to earn their promised pension benefits throughout their government career, although a number of state governments are trying to tinker at the margin, such as by changing cost-of-living payments. Municipalities in Chapter 9 bankrup.tcy can renegotiate pensions." (Bloomberg L.P.)

Comments Received on Liability for Termination of Single-Employer Plans; Treatment of Substantial Cessation of Operations (PDF) – 52 pages. Eleven comments have been received to date. (Pension Benefit Guaranty Corporation)

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Benefits in General; Executive Compensation

[Guidance Overview]
Reporting Deadline for 2010 ISO Exercises and ESPP Stock Transfers Approaches – "For ISO exercises and ESPP stock transfers that occurred in 2010, the information statement must be provided to employees by January 31, 2011." (Dorsey & Whitney LLP)

[Guidance Overview]
Seventh Circuit Rules That Buyer of an Employer's Assets Is Not Liable for Retirement Benefits Payable Under the Employer's Top Hat Plan – "Generally, when a federal right is involved-here the plaintiff's right to retirement benefits under ERISA- the courts will impose liability on the buyer, even in a bonafide sale, so long as two conditions are met: (1) the buyer had notice of the liability before the purchase and (2) there is substantial continuity in the operation of the business before and after the sale. Prong (2) is normally met if no major changes are made in that operation. Here, the plaintiff failed to show that no major changes had occurred." (Stanley D. Baum)

Court's Ruling on WARN Act Could Benefit Employers – "In a decision that could be beneficial to employers, the 7th U.S. Circuit Court of Appeals has ruled that DHL Express (USA) Inc. and its German parent company did not violate the federal Worker Adjustment and Retraining Notification Act when it reached severance agreements with hundreds of unionized drivers." (Business Insurance)

Nancy Dittmer Discusses Diversification in an ESOP – In her latest column on the NCEO's Web site, Nancy Dittmer continues her discussion of diversification in an ESOP. (National Center for Employee Ownership)

Press Releases

US Department of Labor Announces a Public Hearing on Proposed Definition of Fiduciary Regulation U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

US Labor Department Obtains Consent Judgment Protecting 401(k) Assets of Former Raleigh, NC-based Human Resources Company U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

US Department of Labor Sues Defunct Minnesota Land Clearing Company and Owners to Recover Retirement Plan Assets U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

The SPARK Institute Urges EBSA To Clarify And Modify Proposed Target Date Fund Disclosure Rule SPARK Institute

Milliman Analysis: Corporate Pensions End 2010 on Strong Note but Funded Status Still Down for the Year Milliman USA

'10 for 2011': New Yearís Resolutions Defined Contribution Plan Sponsors Should Make Now Mercer

Employee Benefits Jobs

Sales Support Specialist
for Northwestern Benefit Corporation of Georgia in GA

TL II RP Administration
for The Standard in OR

Retirement Plan Administrator
for MVP Plan Administrators, Inc. in NC

Senior Employee Education Consultant
for PNC Bank, N.A. in PA

Webcasts and Conferences

Evaluating Your Third-Party Administrator: Are You Getting What You're Paying For?
Nationwide on February 3, 2011 Lorman Education Services

Interaction of Health Care Reform with Other Laws
Nationwide on February 7, 2011 Lorman Education Services

Roth Conversion and Portability
Nationwide on February 17, 2011 McKay Hochman Co., Inc.

Terminating 401(k) Plans & Other Defined Contribution Plans
Nationwide on January 19, 2011 McKay Hochman Co., Inc.

Understanding Roth Accounts in 401(k), 403(b), and 457(b) Plans
Nationwide on February 18, 2011 Lorman Education Services

Understanding the Impact of Health Care Reform
Nationwide on February 10, 2011 Lorman Education Services

WEB Chicago Chapter Lunch Meeting
in Illinois on January 26, 2011 Worldwide Employee Benefits Network (WEB)

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