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December 13, 2011 Get Health & Welfare News  |  Advertise  |  Unsubscribe  |  Past Issues  |  Search

Employee Benefits Jobs

401(k) Administrator
for TPA firm in San Diego, CA in CA

Employee Benefits Lawyer
for Lane Powell PC in OR

Sr Calc/Complex Spec
for Prudential in CT

Account Executive - Sales
for Liazon in CA, DC, DE, FL, MA, MD, NJ, NY, PA

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Webcasts and Conferences

Cafeteria Plan, Health FSA, and DCAP Mistakes: Finding, Fixing, and Preventing
Nationwide on December 8, 2011 presented by Thomson Reuters / EBIA


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[Official Guidance]
IRS Announcement 2011-81: IRS to Hold Off on Section 4975 Prohibited Transaction Sanctions for Certain Pledges of IRAs (PDF)
"[U]ntil issuance of further guidance from the IRS superseding this announcement, the IRS will determine the tax consequences relating to an IRA without taking into account the consequences that might otherwise result from a prohibited transaction under § 4975 resulting from entering into any indemnification agreement or any cross-collateralization agreement similar to the agreements described in DOL Advisory Opinions 2009-03A and 2011-09A, provided there has been no execution or other enforcement pursuant to the agreement against the assets of an IRA account of the individual granting the security interest or entering into the cross-collateralization agreement." (U.S. Internal Revenue Service)


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[Guidance Overview]
DOL Clarification of Electronic Fee Disclosure Guidance
"The revised release addresses two specific points relating to the use of continuous-access websites for disclosure purposes . . . ." (Morgan, Lewis & Bockius LLP)

[Guidance Overview]
Required 2011 Qualified Retirement Plan Amendments and Cycle A Determination Letter Filing Deadline
"Discussed [in this article] are summaries of the amendments that individually designed plans may be required to adopt in 2011 as well as the plan document considerations for plans that are scheduled to apply for an IRS determination letter under Cycle A." (Practical Law Company)

[Guidance Overview]
Cycle A Filers May Use Prior Version of Form 5300, IRS Advises
"The IRS has reminded employers that the second remedial amendment cycle submission period for individually designed plans in Cycle A began on February 1, 2011 and ends on January 31, 2012." (Wolters Kluwer Law & Business / CCH)


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[Guidance Overview]
PBGC Notice Extends Reportable Event Relief for 2012
"This notice provides guidance for the 2012 plan year on how to comply with the proposed amendments to the reportable events regulations." (Van Iwaarden Associates)

Jazz Musicians in New York City Start a Pension Push
"The campaign began quietly last Thursday night, when four members of Local 802 of the American Federation of Musicians stood in the cold outside the Blue Note in Greenwich Village and handed out leaflets with the headline 'Justice for Jazz Artists!'" (The New York Times; free registration required)

De-Risking Pensions: Emerging Opportunity Through Lump Sum Cash-Outs Under PPA (PDF)
"Under PPA, pension plan sponsors have been provided an attractive risk transfer opportunity, specifically the: Ability to amend plans to allow full lump sum distributions on a favorable interest rate basis; Use of high-quality corporate bonds as the interest rate basis instead of the more conservative U.S. Treasury rates used before PPA (higher allowable interest rates result in lower lump sum cash-outs); Allowance to use the new basis on all past service benefits as well as future accruals (i.e., no protection of the old lump sum basis for past accruals unless the plan sponsor chooses to provide such protections as a plan subsidy)[.]" (The Prudential Insurance Company of America)

Cash Balance Plan — Technically a Defined Benefit System, but Looks and Feels Like a 401(k)
"The plans get special treatment from the Internal Revenue Service. Participants who are aged 50 or more can make a six-figure maximum contribution, far more than what's allowable to a 401(k)." (Sun-Times Media, LLC)

South Carolina House Panel Adopts Retirement Changes
"One of the main changes lawmakers adopted would raise the amount state employees pay into their retirement plan. The employee contribution would go from the current 6.5 percent to 7.5 percent of pay. The state, meaning taxpayers, would also put almost one percent more into the system." (Media General Communications Holdings, LLC.)

Tips for Baby Boomers Reaching Retirement Age in 2012
"In 2012, the oldest baby boomers will turn 66, an important age for Social Security eligibility. At 66, boomers can claim the full amount of Social Security they have earned, and the penalty for working and claiming Social Security benefits at the same time disappears." (U.S. News & World Report LP)

Improving Retirement Success by Managing the 'Target-Date' (PDF)
"Delaying retirement is not the only method available to improve the probability of retirement success for a 401(k) participant. Perhaps the easiest method to improve a participant's funded status is the simplest: save more. Based on research by one of the authors, retirement savings drives approximately 74 percent of retirement success" (Journal of Pension Benefits via Unified Trust Company)

State Hybrid Retirement Plans (PDF)
"This brief examines two types of hybrid plans in use in the public sector. The first is a cash balance plan, which marries elements of traditional pensions and individual accounts into a single plan . . . . The second combines a smaller traditional defined benefit (DB) pension with an individual defined contribution (DC) retirement savings account, referred to in this brief as a 'DB+DC plan' . . . ." (National Association of State Retirement Administrators)

IRS Might Resolve 457 Plan Questions
"On Nov. 8, the IRS released an Advance Notice of Proposed Rulemaking announcing that it would be issuing proposed regulations which would define the term 'governmental plan' under Section 414(d) of the code. The IRS pointed out that the principles set out in the 414(d) regulations would generally also apply for purposes of section 457." (Credit Union Times)

Pitfalls of Inherited IRAs
"If you are the guardian of a child who inherits such an account, you should consider moving the assets into an inherited IRA for the child rather than simply withdrawing the money and paying a sizable chunk of the inheritance in taxes upfront, says William Schmidt, an estate-planning attorney at Schmidt & Federico in Boston." (The Wall Street Journal)

Investors in Self-Directed IRA Accounts Face New Fraud Threats
"Self-directed IRAs are attractive because of their wide latitude. While many banks and brokerage firms limit IRA investors to stocks, bonds, mutual funds and certificates of deposit, the only assets off-limits in individual retirement accounts, per the U.S. tax code, are life-insurance policies and collectibles, including some types of coins." (The Wall Street Journal)

Benefits in General; Executive Compensation

[Guidance Overview]
The ERISA Litigation Newsletter, December 2011
The newsletter includes the following: Third Circuit Finds 'Inequitable' The Enforceability of a Clear ERISA Welfare Plan Reimbursement Provision That Deprived a Participant of a Full Recovery; District Court Dismisses ERISA § 502(a)(2) Claim Based on Plaintiffs' Failure to Make Pre-Suit Demand; Application of ERISA Section 510 to Internal Workplace Complaints: A Review of Circuit Court Decisions; and, Rulings, Filings, and Settlements of Interest. (Proskauer Rose LLP)

[Guidance Overview]
New York's Same Se.x Marriage Law Has Broad Implications for Employee Benefit Plans
"Despite the broad application of DOMA, and perhaps to some extent because of it, states have begun to consider and in some cases enact laws that extend marriage rights to same se.x couples. By extension, these laws effectively require employers within those states to provide certain benefits to same se.x couples to the extent that these laws are not found to be preempted under ERISA or otherwise in conflict with federal law." (Porter Wright Morris & Arthur LLP)

Getting Executive Compensation Ready for 2012: Starting with ISS Guidelines (PDF)
"This Client Alert addresses some of the key implications for publicly traded U.S. companies, and is followed by our article titled 'Candor for Compensation Committees' which is reproduced from the latest edition of Board Member magazine because the article highlights actions that compensation committees should be taking this winter in order to be ready for the 2012 proxy season." (Paul Hastings LLP)

Companies Bolster Pay-for-Performance in Executive Comp Due to 'Say on Pay'
"Experts from consulting firm PricewaterhouseCoopers detail concrete preparations and advice for companies to reform their executive compensation practices in anticipation of what promises to be an even tougher shareholder vote in 2012." (Employee Benefit News)

2012 Resolutions for Employee Benefits and Executive Compensation
"This article identifies three key employee benefits and executive compensation items that employers should resolve to focus on in 2012: 1) Review compensation plans and practices for compliance with Section 162(m) of the IRC; 2) Plan for summaries of benefits and coverage for group health plans; and 3) Prepare to comply with DOL fee disclosure requirements." (Practical Law Company)

IRS Reminds Dual Citizens and Americans Living Abroad of FBAR, Other Filing Requirements
"In a fact sheet (FS-2011-13) released Friday, the IRS reminded U.S. citizens and dual citizens of the United States and foreign countries who live abroad about U.S. filing requirements, including Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR)." (American Institute of Certified Public Accountants)

[Opinion]
The Commuting Tax Break Puzzle: Why Driving Is Rewarded Over Taking the Bus
"This backward state of affairs, where a solo driver in a Lexus trumps the hordes of people standing on the city bus and riding the suburban commuter train, is in part an accident of history." (The New York Times; free registration required)

[Opinion]
PayScale.com's Publication of 'Pay Ratios' Masks the Complexity of Dodd-Frank Requirement
"This week, PayScale.com, an online compensation database, produced its version of the ratio between CEO and median employee pay for the Fortune 50 companies, thereby perpetuating the misperception that it will be easy for companies to comply with the Dodd-Frank pay ratio mandate." (HR Policy Association)

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