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March 8, 2012 Get Health & Welfare News  |  Advertise  |  Unsubscribe  |  Past Issues  |  Search

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Compliance Manager - COBRA
for Ceridian in FL

Financial Services Representative
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Customer Care Specialist - Installations & Conversions
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Customer Care Specialist - Service
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Pension Administrator II
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Consultant, Health & Welfare Plans
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Senior Actuarial Audit Manager, Actuarial
for Prudential in CT, NJ, PA

Conversion Analyst
for Sentinel Benefits and Financial Group in MA

Employee Education Consultant
for PNC Bank in OH

Director, Retirement Plans Technical Services
for Nationwide in OH

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[Guidance Overview]
The Fiduciary Duty to Investigate Plan Investments (PDF)
"The Fourth Circuit's ruling in the Plasterer's case is a reminder that liability for breaching the fiduciary duty to investigate and diversify retirement plan investments occurs only when the plan incurs an actual quantifiable loss." (The Wagner Law Group)

Discover Innovative Solutions at NIPA’s 2012 Annual Forum & Expo   [Advert.]

Sponsored by NIPA (National Institute of Pension Administrators)

NIPA’s Annual Forum & Expo provides the most up-to-date information to expand your industry knowledge. Join us April 29-May 2 at The Cosmopolitan of Las Vegas to take advantage of 25 sessions focused on the most pressing issues you face each day.

[Guidance Overview]
Plan Sponsors Need to Be Aware of New DOL Disclosure Rules (PDF)
Includes 10-point action plan for plan sponsors. (Metz Lewis Brodman Must O'Keefe LLC)

Working Longer, Retiring Later: Retirement Savings Lacking
"Hurt by the downturn and worried that they have saved too little for retirement, many older Americans are working longer — 18 percent of Americans 65 and over are in the labor force, up from 13 percent a decade ago, translating into an increase of three mil.lion workers in that age group." (The New York Times; free registration required)

CalPERS Considers Moves that Would Boost Pension Costs for Governments
"In a memo to the CalPERS board, [the actuary] suggested lowering the assumed annual rate of return to 7.25% from 7.75%, a decade-old benchmark, as the state continues to grapple with the slow recovery from the Great Recession. [He also is recommending that CalPERS] lower its ongoing inflation assumption to 2.75% from 3%. The effect of the two changes would raise the state government's employee pension costs as much as 4.5% in the fiscal year that begins July 1. Some pension costs for public safety agencies could jump as much as 6.6%[.]" (Los Angeles Times)

Bil.lion-Dollar Florida Pension Battle Shows Challenge of Cutting Benefits
"Of 41 U.S. states that made significant pension changes in 2010 and 2011, at least 13, or almost 30 percent, have faced court challenges, according to the National Conference of State Legislatures." (Bloomberg)

Should You Convert Your Traditional 401(k) to a Roth 401(k)?
"[I]n contrast with IRA conversions, which are now available for all investors, converting assets in a company retirement plan to Roth status is only an option for a subset of retirement-plan investors. Depending on their status, they might only be able to convert a portion of their balances, and even if an employee is able to convert from a traditional to a Roth retirement plan, doing so might not always be the best route to take." (Morningstar)

Congressional Resolution to Retain Retirement Tax Incentives Draws Bipartisan Support
"The resolution expresses the 'sense of Congress' that 'tax incentives play an important role in encouraging employers to sponsor and maintain retirement plans and encouraging participants to contribute to such plans' and that 'a reformed and simplified tax code should include properly structured tax incentives to maintain and contribute to such plans.'" (Wolters Kluwer Law & Business / CCH)

District of Columbia Lump-Sum Retirement Distributions Subject to Withholding
"The District of Columbia has enacted emergency legislation that provides for personal income tax withholding from a retirement distribution that is a lump-sum payment of a payee's entire account balance. Previously, withholding applied to any distribution from a retirement plan or retirement account if the distribution was subject to federal withholding." (Wolters Kluwer Law & Business / CCH)

American Airlines to Freeze Pension Plans
"In a big change of position, American Airlines Inc. said Wednesday that it intends to freeze — not terminate — at least three of its four massively underfunded pension plans." (Business Insurance; free registration required)

Will State Agencies Derail Local Pension Reforms?
"[L]ocal officials say union allies are using [California] state agencies to try to derail or undermine local pension reforms on the June ballot in San Jose and San Diego. The widely watched local measures, going beyond the governor's plan, would cut pension benefits promised current workers, something now mainly limited to new hires. Major court battles are likely if voters approve the potentially trendsetting measures." (Calpensions)

Homework for Teachers: Their Investment Plans
"[Today's] streamlined 403(b)s look more like the private sector's 401(k) retirement plans, with employees putting part of their paychecks into individual accounts, sometimes with matching amounts from the employer, and choosing investments. Still, important differences remain. Workers in the nonprofit sector cannot simply follow the advice in the ubiquitous 'how to invest your 401(k)' books and articles because many of them also have pensions, annuities or other retirement investments." (The New York Times; free registration required)

New York Taxpayers Need Relief from Soaring Retirement Costs
"Yet [the Democratic Assembly Speaker and Republican Senate Majority Leader] are stonewalling Gov. Cuomo on reforming pensions for newly hired workers. For the good of all New Yorkers, Cuomo cannot not back down one inch." (

Give Private Employers a Break on Pensions, Says Former Director of PBGC
"To relieve [the current] pressures and make it more attractive for employers to maintain their pension plans intact, Congress should make two changes. It should allow companies to use a multiyear average of bond yields, instead of a two-year average, to calculate their pension contributions, and it should reduce funding requirements from 100 percent of liabilities to something more reasonable." (Bloomberg)

Benefits in General; Executive Compensation

[Guidance Overview]
New FATCA Reporting Obligation May Affect Global U.S. Employees' 2011 Tax Returns
"Multinational corporations often have mobile employees as part of their global workforce participating in non-US retirement, deferred compensation and equity compensation plans. US taxpayers participating in such non-US retirement plans should be aware of potential new obligations to report those interests on IRS Form 8938, beginning with their individual tax returns for 2011." (Groom Law Group)

[Guidance Overview]
Avoid Tax Return Mistakes with Stock Options and ESPPs: What You Need to Know in 2012
"This tax return season has the potential to be more confusing than most if you sold stock last year. You must now file the new IRS Form 8949 along with the revised Schedule D. This change stems from the expansion of the information that brokers must report on IRS Form 1099-B. This article from has tips on these and other crucial tax return topics." (myStockOptions)

Public Company Accounting Oversight Board's Recent Proposal on Executive Compensation
"The early leader for this year's 'Shocking Development of the Year Award' has to be last week's Public Company Accounting Oversight Board proposed amendments to auditing standards for identifying and assessing excessive risk in executive compensation programs.... If this proposal becomes a reality then it might be possible that an auditor could tell a company that its compensation programs are 'too risky' and that they cannot sign off on the financials, placing outside auditors in the role of pre-approving executive compensation programs. [T]his is not their role, and [the author doubts] that they want this role any more than we want to give it to them." (Winston & Strawn LLP)

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Jeanette Hull, News Editor
David Rhett Baker, J.D., Editor and Publisher
Lois Baker, J.D., President
Holly Horton, Business Manager

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