IRS Modification of Guidance on Partial Exchanges of Annuity Contracts (PDF)
"Rev. Proc. 2011–38 provides that a direct transfer of a portion of the cash surrender value of an existing annuity contract for a second annuity contract will be treated as a tax-free exchange under section 1035 if no amount, other than an amount received as an annuity for a period of 10 years or more or during one or more lives, is received under either the existing annuity contract or the second annuity contract during the 180 days beginning on the date of the transfer (in the case of a new contract, the date the contract is placed in-force)." (Sutherland Asbill & Brennan LLP)

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Form 8955-SSA and Participant Statements
"The new 2009 form includes a new question regarding participant statements (line 8: 'Did the plan administrator provide an individual statement to each participant required to receive a statement'). The existence of this new question raises the concern that the IRS may be interested in enforcing a long existing requirement for plan sponsors to mail statements to participants for whom it is required to report on Form 8955-SSA. Penalties apply for plans that fail to send out statements." (CCH INCORPORATED)

Court Supports Lowering COLAs for Colorado Public Employees' Retirement Association Members
"The [Denver Post] news report said lawmakers passed a bill that sought to address the long-term financial solvency of PERA, in part by capping annual cost-of-living increases that had been at as much as 3.5% to 2%." (PLANSPONSOR.COM)

IRS Gets Better at Catching Illegal Retirement Plans
"At the request of the IRS, TIGTA reviewed whether the processes for selecting examination cases allowed for emerging issues to be considered and took into account the risk of noncompliance for the various types of retirement plans such as 401(k) and pension plans." (Accounting Today and SourceMedia, Inc.)

IRS's Employee Plans Function Has Improved the Process for Selecting Retirement Plans for Examination (PDF)
"Ensuring that plans comply with all applicable statutes and regulations provides plan participants with greater assurance that promised benefits will be available upon retirement." (U.S Department of the Treasury Inspector General for Tax Administration)

GAO Report on Retirement Income: Ensuring Income Throughout Retirement Requires Difficult Choices (PDF)
"GAO was asked to review (1) strategies that experts recommend retirees employ to ensure income throughout retirement, (2) choices retirees have made for managing their pension and financial assets for generating income, and (3) policy options available to ensure income throughout retirement and their advantages and disadvantages. [Audio interview by GAO staff with Charles Jeszeck, Director, Education, Workforce, and Income Security is at http://www.gao.gov/podcast/watchdog_episode_64.html and link to transcript of interview is available on that page.] (U.S. Government Accountability Office)

Video and Text: Why Will the Great Recession Affect Retirement Incomes?
"Karen E. Smith, a senior research associate at the Income and Benefits Policy Center, explains the reasons why the Great Recession has hit retirement savings so hard, what age and socio-economic groups have been hit the hardest, and how economic behavior might change as a result." (Urban Institute)

The U.S. Retirement Market, First Quarter 2011 (PDF)
"Annuities include all fixed and variable annuity reserves at life insurance companies less annuities held by IRAs, 403(b) plans, 457 plans, and private pension funds. Some of these annuity reserves represent assets of individuals held outside retirement plan arrangements and IRAs; however, information to separate out such reserves is not available." (Investment Company Institute)

ESOPs: The Ideal Vehicle for Buying Out a Minority Shareholder
"Consider the following differences between a majority shareholder's direct purchase of minority held corporation shares and his/her same purchase of shares through an ESOP, where the objective is to provide the selling shareholder with $10 mil.lion after taxes. . . ." (Fox Rothschild LLP)

Partners Can't Have Individual SEP Plans, Says IRS
"Partners or members of an LLC taxed as a partnership are considered employees for retirement plan purposes, and thus cannot have individual SEP plans, according to the IRS. Only an employer can maintain and contribute to a SEP plan for its employees." (Wolters Kluwer Law & Business)

State of Ohio Pension Plans' 8% Earnings Assumption Is 'Reasonable'
"Despite legislators' skepticism, Ohio's five public-pension plans were validated yesterday when an outside expert said their forecasts that investments will grow 8 percent a year on average are reasonable." (The Columbus Dispatch)

State of Florida's Public Employees to Begin Making Required Contributions
"[The judge] acknowledged in an eight-page ruling that it is unclear what funds the state would use to pay back workers if the law is tossed out. But she also wrote that she must 'assume that the state of Florida would comply with an order from this court to refund to employees any funds that have been wrongfully deducted from their salary.'" (NorthEscambia.com)

Retirement Investors Focusing More on Fees
"The timing for ETFs to break into the 401(k) landscape is ripe, as investors search for lower costs. The decline in expense ratios is also a result of the low interest rate climate, as well as the fee waivers by many money market fund providers." (Global Trends Investments)

Two Rulings Find Cuts in Public Pensions Permissible
"Judges in Colorado and Minnesota have dismissed court challenges by retired public workers whose pensions had been cut — developments that may embolden other states and cities to use pension reductions as a tool to help balance their budgets." (The New York Times; free registration required)

Six Ways to Calculate How Fast You'll Run Out of Retirement Funds
"Of course, determining which of these methods is best for you will depend upon the size of your portfolio, your risk tolerance, your time horizon and various other factors." (Investopedia US via San Francisco Chronicle)

How to Convert a 401(k) to a Roth 401(k)
"To start, know that not every company will allow you to convert your existing 401k balance to a Roth 401k. You need to check with your employer to see if this is an even an option. If not, just change your contributions so that new investments go into the new type of account rather than your original 401k." (Retirement Online LLC)

Retirees and Workers File Lawsuits Over Cincinnati's New Pension Rules
"The new retirement plan, effective Friday, changes the cost-of-living raises some employees said could mean the loss of tens of thousands of dollars over their life after retirement. The old plan gives employees a 3 percent cost-of-living raise each year using compound interest - the interest is on the base pay of the pension and the interest it earns." (news.cincinnati.com)

Two Lawsuits Filed Against New Hampshire Pension Reform Law
"One of the lawsuits was filed by public employee unions and asks a judge to halt a 2 percent increase of their pension contributions until a ruling can be made on its constitutionality. A second suit was filed by the New Hampshire Retirement System, which alleges the pension reform bill 'usurps the board's authority.'" (Dow Jones Local Media Group, Inc.)

Business Groups Ask PBGC to Ease Up on Fines for Inadvertent Errors
"While incentives are needed for employers to be 'conscientious and careful,' the 'PBGC needs to balance that objective with the need not to act in a punitive way with respect to plan sponsors that make inadvertent errors despite clear evidence of an intent to comply,' . . . ." (Business Insurance)

Ninth Circuit Holds that Third Party Insurers May Be Sued under ERISA
"The Ninth Circuit's decision expands the scope of potential liability in benefits claims under ERISA. Accordingly, companies that have authority to accept or reject benefits claims, regardless of whether they are identified as the plan administrator, should ensure that all decisions comply with ERISA's requirements." (Ford & Harrison LLP)

IRS Raises Standard Mileage Rate for Second Half of 2011
"In response to rising gasoline prices, the IRS has raised the standard mileage rate for business use of an automobile from 51 cents per mile to 55½ cents per mile, effective July 1 . . . . The medical and moving standard mileage rate is increasing to 23½ cents per mile, also on July 1." (American Institute of Certified Public Accountants)

International Employee Assistance Programs: The Forgotten Benefit
"Expatriates need a lifeline, and employers who arrange for this, are often more successful in helping their expatriates carry out the job. So how can you accomplish this? The easiest way is to set up an international Employee Assistance Program . . . ." (William Gallagher Associates Insurance Brokers, Inc.)

Legal Same-S.ex Marriage in New York State Leads Companies to Cut Partner Benefits
"At least two major employers — Raytheon Co. and International Business Machines Corp. — say New York employees in same-s.ex relationships now will have to get married if they want to qualify for the benefits. The companies appear to be the exceptions among big corporate employers." (The Wall Street Journal)

ESOP Sponsors: Be Careful What You Say in Your Summary Plan Description
In his latest 'Observations on Employee Ownership' column, NCEO founder Corey Rosen discusses the implications of the Supreme Court's recent CIGNA v. Amara decision. (The National Center for Employee Ownership (NCEO))

PBGC Helps Preserve Pensions for 7,400 People at Tronox in Oklahoma City
(Pension Benefit Guaranty Corporation (PBGC))

fi360 Announces Five New Hires
(Fiduciary360 (fi360))

Surging Employee Benefits Costs Force Employers to Make Difficult Trade-Offs to Maintain Benefit Levels, New Survey Shows
(Corporate Synergies)

IASB Introduces Improvements to the Accounting for Post-employment Benefits
(International Accounting Standards Board (IASB))

CFDD (The Center for Due Diligence)

Regional Retirement Plan Consultant, West Region - San Francisco, CA
for RBC Wealth Management in CA

401(k) Plan Administrator
for ABG Carolinas, Inc., a subsidiary of Pentegra Services, Inc. in NC

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