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ERISA Paralegal - Experienced in Employee Benefits
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Vice President, Sales
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Voluntary Fiduciary Correction Program Webinar
Nationwide on January 30, 2013 presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Wellness Programs: Overcoming Compliance Hurdles and Looking Toward 2014
Nationwide on January 10, 2013 presented by Thomson Reuters / EBIA

Avoid Penalties with New Health Care Reform Tools
Nationwide on January 16, 2013 presented by Davidson Marketing Group -- FutureOffice Network

Health Care Reform and State Exchange Panel Event Decisions & Actions for Employers Before 1/1/2014 State Exchange
in California on January 24, 2013 presented by No. Calif. Chapter of Certified Employee Benefits Specialists (ISCEBS)

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[Official Guidance]

IRS Explanation of Rules for Making Charitable Donations from IRAs for 2012 and 2013
"The American Taxpayer Relief Act of 2012 (ATRA) extended the qualified charitable distribution (QCD) provisions for 2012 and 2013. Several special transition rules were included in ATRA to enable taxpayers to have a donation made before February 1, 2013, treated as a 2012 QCD." [Note: This IRS page describes various transition rules and reporting requirements.] (Internal Revenue Service)

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[Guidance Overview]

Expanded Roth Conversion Opportunity for Retirement Plan Participants
"Roth conversions may now become attractive to relatively young workers in low tax brackets. They can pay tax today at a 15% marginal rate, let earnings accumulate for several decades, then make withdrawals without paying any tax at all, no matter how high their rates may go in the future. From the Treasury's point of view, conversions generate revenue in the short run, while the long run is a long way off." (Steptoe & Johnson LLP)

[Guidance Overview]

IRS's Employee Plans Correction Procedures Expanded for 403(b) Plans
"A 403(b) plan sponsor may use the Voluntary Correction Program (VCP) under EPCRS to correct a failure to timely adopt a written 403(b) plan document.... [If] the failure to timely adopt the plan is the only failure included in the submission, and the VCP submission is made by December 31, 2013, the applicable IRS compliance fee is reduced by 50%. The standard compliance fees under EPCRS range from $750 for plans with less than 20 participants to $25,000 for plans with more than 10,000 participants. Accordingly, IRS is offering a significant incentive for 403(b) plan sponsors to bring their plan documents into compliance." (EisnerAmper LLP)

Converting 401(k) and 403(b) Accounts to Roth Accounts: New Conversion Incentive Something to Consider
"Enticing workers to prepay taxes on these accounts by converting them to Roth plans that will be essentially free from taxes in the future (provided certain provisions are met) is designed to generate $12 billion over a decade, the government asserts.... 'It looks like a revenue raiser right now, but that $12 billion is taxpayers betting against the government and saying that it's going to pay off down the road' to put these income taxes behind them now, said Eddie Adkins, a partner in Grant Thornton's national tax office, in Washington. Does it make sense for you?" (Chicago Tribune; free registration required)

DB vs. DC: How Unitized Accounting Can Make a Difference
"Maintaining and operating both defined benefit and defined contribution plans can itself present a daunting budget consideration for plan sponsors. In an ideal scenario, the economies of scale built over many years by the DB plans can be leveraged. The investment allocation, investment manager monitoring, custody relationships, securities lending, FX processing and transaction processing systems all have been developed over many years by the existing defined benefit programs. Ideally all of those systems can be utilized for the benefit of the much smaller (initially) and newer defined contribution programs. These economies can be accomplished by unitizing the investment portfolios and making the same investment structures available to the defined contribution programs that are currently in use by the defined benefit programs." (Pensions & Investments)

Idaho Pension Fund Investments Exceed Expectations: 7.44% for First Half of Fiscal Year
"Public Employee Retirement System of Idaho director Don Drum told budget writers [that] the more than $12.5 billion, 125,000-member fund is returning 7.44 percent through this month, above the 7 percent estimate. If the trend continues, Drum says PERSI will reduce its unfunded liability that now stands at $1.6 billion, a figure that's lower than in many other states whose pensions have had to make benefit changes to help balance their books." (Idaho Press-Tribune)

IRS Issues 2012 Form 8880 for Retirement Savings Contribution Credit
"The IRS released the 2012 Form 8880, Credit for Qualified Retirement Savings Contributions. This form is used by tax return filers who wish to claim a credit for contributions made to IRAs and to deferral-type employer-sponsored retirement plans. The credit, whose maximum is 50 percent, is means-tested, and only those taxpayers falling within certain income limits qualify." (Ascensus)

26,500 Postal Service Workers Accept Buyout Offers
"About 26,500 U.S. Postal Service employees have accepted the agency's latest buyout offers, according to updated figures. This amounts to about 23 percent of the more than 115,000 employees who were eligible for the separation incentive. They will each receive $15,000 in compensation. About 20,000 of those who chose to leave the Postal Service were eligible for retirement, while about 6,000 opted for voluntary early retirement. An additional 352 employees chose to resign." (GovExec.com)

Benefits of Fee Disclosure Cannot Be Ignored
"If these studies accurately reflect participant reaction to the disclosures, should plan sponsors, who face a fiduciary duty with the fee disclosure requirements, be overly concerned? Not according to John Schadl, principal and head of Vanguard Strategic Retirement Consulting.... What's important, he said, is that participants have access to information when they need it -- such as when a change in personal circumstances might lead to a plan investment adjustment." (The Vanguard Group, Inc.)

Optimal Rules for DC Plans: What Can We Learn from the U.S. and Australian Pension Systems?
"Both the United States and Australia have multi-pillar retirement systems that include a public component and a private component.... [T]his paper compares the rules governing defined contribution plans in the U.S. and Australia. In particular, this paper focuses on the rules governing the contribution, accumulation, and distribution stages; and it discusses which public policies will best help workers maximize their defined contribution plan accumulations and, consequently, the retirement income that they will eventually receive." (University of Oklahoma, and University of New South Wales -- Australian Taxation Studies Program)

Financial Security and Careers in the Nonprofit and Philanthropic Sector (PDF)
"Almost one-half of sector employees are not satisfied with their ability to prepare financially for retirement. More than 40% do not feel that they are accumulating sufficient financial resources to ensure their long-term financial security. At the same time, over three-quarters report access to an employer-sponsored retirement plan or plans; almost one-third have access to a defined benefit pension plan and more than two-thirds to a defined contribution plan, such as a 403(b) plan." (TIAA-CREF Institute)

Fee Disclosure Requirement Coming for British Employers
"Private pension companies will be forced to reveal fees and charges taken from employees' retirement savings under an agreement drawn up by the Association of British Insurers (ABI), [whose] members include pension and insurance organisations running some of the UK's biggest pension schemes.... Private pension firms have been accused of failing to disclose some of the costs they levy on customers' investment funds, leaving people unaware that their pension savings were being eroded by the fees. The average annual management charge on a workplace pension scheme is 0.77 percent, according to the ABI." (Reuters)

[Opinion]

The Persistent Pension Fund Doublethink Behind an Assumed 7% Rate of Return
"There is no variable affecting pension solvency, or explaining why they are woefully underfunded today, more significant than the rate of return. None. Nothing comes close. Not 'pension holidays,' not even the retroactively granted benefit enhancements. If pension funds can actually deliver 7.5% returns, on average, for the next 20-30 years, then every other challenge they face is manageable. But they cannot. Here's why." (California Public Policy Center)

[Opinion]

Retirees Face Their Own 'Fiscal Cliff'
"One group with a darker financial future is older Americans. With some new twists to old-fashioned retirement saving plans, Americans can fill some gaps we can expect as Social Security, Medicare and other safety net programs get recast." (USA TODAY)

[Guidance Overview]

January 31 Deadline Looms for Information Statements and Returns for Incentive Stock Option and Employee Stock Purchase Plans
"Effective for ISO exercises and initial transfers of legal title to shares acquired under an ESPP occurring in 2010 and later years, the final regulations under Section 6039 require the transferring corporation to file information returns with the IRS, as well as provide information statements to the affected employees and former employees. The information returns, Form 3921 for ISO exercises and Form 3922 for initial ESPP share transfers, must be filed electronically by any corporation required to file 250 or more of a particular return and may otherwise be filed either electronically or in paper form." (DLA Piper)

At Top of the List of Executive Compensation Issues for 2013: Strike Suits
"The strike suit lawyers have been sending demand letters to many public companies shortly after they file their annual proxy statement ... The letters are often followed by a lawsuit seeking a preliminary injunction of the shareholder vote to be held at the Company's annual meeting (which is the equivalent of Armageddon to most public companies) ... [alleging] that the companies' disclosure of executive compensation information in the proxy was insufficient to allow an informed shareholder vote.... [T]he consequences of postponing the annual shareholders meeting are so high and the period between the lawsuit and the meeting is so short, that many companies have paid settlements of between $250,000-$650,000 and made an amended SEC filing just to make the lawsuit go away." (Winston & Strawn LLP)

Director Compensation: A Survey of Certain Practices at Emerging Growth Companies
"The role and responsibilities of a director of a public company have greatly increased over the past ten years. After financial and corporate governance failures, new regulations have been implemented that impose additional requirements on directors.... To determine what impact this has had on companies that have only recently become subject to extra scrutiny by going public, this Article examines non-employee director compensation policies of certain companies that conducted initial public offerings (IPOs) in 2012. In particular, this Article focuses on US emerging growth companies (EGCs), which benefit from reduced regulatory requirements under the Jumpstart Our Business Startups Act of 2012 (JOBS Act)." (Practical Law Company)

Amara v. Cigna Corp. -- The Beat Goes On
"On December 20, 2012, Judge Janet Bond Arterton of the United States District Court for the District of Connecticut held that a class of 25,000 plaintiffs are entitled to benefits in addition to those provided by the terms of their cash balance benefit plan based on her reformation (rewriting) of the plan terms.... [T]he district court considered whether reformation and surcharge were appropriate equitable remedies under ERISA Section 502(a)(3), following the Supreme Court's 2011 remand ... [which] held that reformation and surcharge were not available remedies under ERISA Section 502(a)(1)(B), but suggested that ... the district court might award such relief under Section 502(a)(3) as 'appropriate equitable relief'.... The Amara saga marches on now to the Court of Appeals for the Second Circuit." [Amara v. CIGNA Corp., No 3:01-cv-2361, 2012 U.S. Dist. LEXIS 180355 (D. Conn. Dec. 20, 2012)] (Seyfarth Shaw LLP)

Transparency and Total Compensation: Should Employers Be Doing More?
"With the W-2 reporting requirement to disclose the amount both employee and employer spend on healthcare costs beginning in January 2013, as well as recent fee disclosure requirements for defined contribution plans, benefit cost information for employees is becoming more and more accessible and transparent. Yet, in a time when 40% of employees don't know the cost of their health insurance (LIMRA, 2011) it begs the question, are companies doing enough to take advantage of a consistent and deliberate communications strategy?" (Retirement Town Hall)