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January 30, 2013          Get Health & Welfare News  |  Advertise  |  Unsubscribe
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Defined Benefit / Pension Administrator
for Third Party Administrator in CA

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Webcasts and Conferences

Employee Plan Compliance Resolution Systems (EPCRS) 2013
Nationwide on February 12, 2013 presented by McKay Hochman Co., Inc.

Top-Heavy Contributions
Nationwide on May 23, 2013 presented by McKay Hochman Co., Inc.

Defined Benefit Basic Concepts
Nationwide on June 27, 2013 presented by McKay Hochman Co., Inc.

"403(b) Plans for 401(k) Practitioners" Web Seminar
Nationwide on February 26, 2013 presented by SunGard Relius

Communicating Your ESOP
Nationwide on February 5, 2013 presented by National Center for Employee Ownership

Is an ESOP Right for You?
in Arizona on February 6, 2013 presented by National Center for Employee Ownership

View All Webcasts and Conferences


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[Official Guidance]

PBGC Insurance of Multiemployer Pension Plans: Report to Congress, as Required by ERISA (PDF)
"Every five years, PBGC is required under section 4022A(f)(1) of ERISA to review its multiemployer insurance program, to determine the premiums needed to maintain the current guarantee levels and whether the guarantee levels may be increased without increasing the premiums. The report notes that Congress will need to review broader changes to multiemployer plans prior to the sunset of certain provisions of the Pension Protection Act of 2006, and suggests that changes to the PBGC program and premiums be considered as part of that review." (Pension Benefit Guaranty Corporation)


[Advert.]

DATAIR! Smart By Design -- More Choices -- Less Cost

Sponsored by DATAIR Employee Benefit Systems, Inc.

Proposals, Testing, Valuation, IRS/DOL/PBGC Forms, Plan Documents
Includes Graded, 412(e)(3), Cash Balance, Combo Plans
(888) 328-2474Sales@DATAIR.comwww.DATAIR.com


[Official Guidance]

Multiemployer Pension Plans: Report to Congress, as Required by Pension Protection Act of 2006 (PDF)
"Despite the substantial improvement in plan assets since the market crisis of 2008, however, certifications of plans' funded status for the 2011 plan year -- showing 60% of all plans to be in 'green' status -- likely overstate the extent of plans' financial health. This is due to the significant effect of PRA 2010 funding relief, which increased plans' funded percentages (e.g., by allowing plans to spread the recognition of asset losses over ten years) and delayed projected funding deficiencies (e.g., by extending certain amortization periods and reducing minimum required contributions).... Data available through November 2012 indicate that 52% of participants are in moderately or severely distressed plans (plans in endangered, seriously endangered, or critical status under PPA)[.]" (Pension Benefit Guaranty Corporation)

PBGC Reports Lead to Calls for Multiemployer Pension Reform
"One report looking at the effects of Pension Protection Act changes in 2006 on multiemployer plans found a 48% aggregate funding ratio as of plan year 2009, with active participants (39%) -- for whom contributions are still being made by employers -- outnumbered by non-active participants (61%).... Another report, a five-year evaluation of PBGC multiemployer premiums and benefit guarantees, found that at current premium levels and economic conditions, there is a 35% probability that the PBGC multiemployer pension insurance program will be insolvent by 2022, and a 91% chance of insolvency by 2032. The third, 'exposure' report shows that while PBGC is expected to collect $1.3 billion in premiums in the next decade, potential new obligations could increase by $37.6 billion." (Pensions & Investments)

[Guidance Overview]

Puerto Rico Treasury Extends Deadlines But U.S. Transfer Extension Expires (PDF)
"Puerto Rico's Treasury Department has extended the deadline for amending qualified plans covering employees in Puerto Rico to no earlier than June 30, 2013, and extended the deadline for submitting qualification letter requests to no earlier than September 30, 2013. The IRS has not yet followed suit on extending the deadline for transfers [of participants who were Puerto Rico residents to a plan that would only satisfy the qualification rules under the Puerto Rico Tax Code] and transition relief for coverage tests when Puerto Rico employees are covered under certain Puerto Rico plans." (Buck Consultants)

Mayors Say Cuomo's Pension Changes Would Merely Kick Pension Can Down the Road for 25 Years
"The measure would cut retirement costs for New York municipalities for five years, while locking in contribution rates for 25 years. The critics call it a form of borrowing that may leave localities overpaying and weaken New York's pensions, the nation's fourth best-funded." (Bloomberg)


[Advert.]

The Future of Target-Date Funds - February 25-26, 2013 - Boston, MA

Sponsored by Financial Research Associates, LLC

The 2013 Target-Date Funds Forum highlights the latest trends, challenges & new developments in target-date funds from Plan Sponsors, Investment Consultants, Asset Managers, & Industry Experts. Mention FMP164 during registration to receive 10% discount.


Are In-Plan Options the Next Frontier for Insured Retirement?
"[A] new study ... pinpoints guaranteed lifetime income options offered within employer-provided defined contribution plans as an opportunity to address many emerging retirement security challenges.... [W]orkers who convert a portion of their accumulated assets into a guaranteed income stream can effectively manage many of the risks inherent to the defined contribution retirement system such as longevity risk, volatility and sequence of returns risk, as well as excess withdrawal risk." (Insured Retirement Institute)

The Fiduciary's Guide to Selecting a Target Date Fund (PDF)
"[1] There is no fiduciary upside to taking risk at the target date. Only downside. Class action lawsuits are expected when the next 2008 occurs.... [2] There is a 'risk zone' spanning the 5 years preceding and following retirement during which lifestyles are at stake. Account balances are at their highest and a participant's ability to work longer &/or save more is very limited.... [3] Most participants withdraw their accounts at the target date, so 'target death' (i.e. 'Through') funds are absurd, and built for profit." (Target Date Solutions)

Ten Things Your 401(k) Wants You to Know
"Here are 10 things that your 401(k) would like you to know. 1. Average 401(k) account balances are up but that average account still won't support the average person's retirement.... 2. You should utilize tools to calculate your retirement readiness and adjust your savings strategy.... 3. It's important that you understand the fees you pay to participate in your 401(k) plan.... 4. Diversification is a key component to a successful investment strategy.... 5. Compounding interest works for you." (Milliman)

American Taxpayer Relief Act of 2012 Can Be Beneficial to ESOPs
"ATRA can favorably impact ESOPs in two ways. [1] The higher capital gains tax rates can increase the value of Internal Revenue Code Section 1042 ... allows sellers of stock to C corporation ESOPs to defer capital gains tax on the sale proceeds, subject to meeting certain requirements. ATRA's income tax rate may also increase the value of the S corporation tax benefit." (The Retirement Plan Blog)

A Data Brief on Retirement Plan Assets (Updated January 2013) (PDF)
"The retirement savings of American households took a big hit when the stock market crashed in 2008. Since then, however, a good portion of these losses has been reversed.... Despite the ongoing turbulence in the stock market, retirement account balances have increased since 2009, reaching $9.5 trillion at the end of 2012 -- 9 percent above their peak value in current dollars, but still 1 percent below their peak when adjusted for inflation." (Urban Institute)

Tax Incentives for Retirement Plans: Lessons from Denmark (PDF)
"[A]side from the differences in incentive structures between the two countries, ... [the] study of Danish workers examined only the impact that changes in tax incentives for work place retirement plans might have on worker savings behaviors -- but did not address how employers might react to changes in retirement savings tax incentives.... [R]ecent surveys have found many American private-sector plan sponsors have expressed a desire to offer no plans at all in the absence of tax incentives for workers. If this happened, low-wage workers -- who are generally less prepared for retirement -- would suffer on several counts[.]" (EBRI)

[Opinion]

Pension Liabilities: Time to Get Real
"Creeping pension liabilities are an increasing source of concern for credit investors and full disclosure of the risks surrounding them is what credit investors need to regain confidence in the most affected issuers. A few companies have stepped forward in recent years with some admirable improvements in their disclosures, but in general the information available to investors is still far from what we need." (PIMCO)

[Opinion]

Workers at Risk in Crumbling PBGC Program
"Today, upon the release of three separate Administration reports on the private sector defined benefit pension system, Ways and Means Committee Chairman Dave Camp (R-MI) criticized the Obama Administration for failing to bring forward a plan to protect the pensions of American workers.... The FY 2012 single-employer program liabilities of $112.1 billion and assets of $83.0 billion result in a net deficit of $29.1 billion. The average (mean) and median projected results for FY 2022 are deficits of $29.9 billion and $32.5 billion respectively." (U.S. House Ways and Means Committee)

[Opinion]

U.S. House Committee Leaders Respond to Reports on Multiemployer Pension System
"Bipartisan leaders on the U.S. House Education and the Workforce Committee responded today to three reports on the nation's multiemployer pension system. The reports provide a broad examination of the challenges facing the pension system responsible for providing retirement benefits to more than 10 million individuals." (U.S. House Committee on Education and the Workforce)

Benefits in General; Executive Compensation

Drafting a Private Company Equity Incentive Plan
"When drafting an equity incentive plan, private companies should consider several issues, including: The types of awards that will be available for issuance under the plan. The appropriate share reserve. The appropriate vesting schedule for awards granted under the plan. The methods participants can use to pay the exercise price of stock options. The permissible methods for satisfying tax withholding obligations. The definition of change in control to be included in the plan and what will happen to outstanding awards on a change in control." (Practical Law Company)

Obamacare Potentially Affecting Employer-Sponsored Retirement Plans
"Because of its definition of affordability, beginning next year the [ACA] may affect retirement savings.... Were an employer to reduce wages and salaries (or fail to increase them) and compensate employees by introducing an employer-matching pension plan, the employee is likely to benefit by receiving additional government assistance with his health-insurance costs. The pension contributions will add to the worker's income during retirement, except that the income of elderly people does not determine health-insurance eligibility to the same degree, because the elderly participate in Medicare, most of which is not means-tested." (The New York Times; free registration required)

EBSA Publishes Changes to Delinquent Filer Voluntary Compliance Program
"Recent updates to the DFVC Program website include changes to reflect the Department's final regulation mandating electronic filing of annual reports as part of the implementation of a wholly electronic ERISA Filing Acceptance System (EFAST2) for those reports. In addition, an electronic online payment option was added to the Program's website that uses an online calculator to help filers calculate the applicable penalty payment." (The ERISA Industry Committee)

Press Releases

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