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October 3, 2013          Get Health & Welfare News  |  Advertise
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Employee Benefits Jobs

Plan Specialist
Transamerica Retirement Solutions
in NY

Retention Specialist
MassMutual Financial Group
in CT

Retirement Plan Administrator
Matthews Benefit Group, Inc.
in FL

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Webcasts and Conferences

What Plan Sponsors Need to Know About Retirement Income - Recorded
October 11, 2013 WEBCAST
(Vanguard)

New Information Reporting Under Health Care Reform: Proposed Rules for Code Sections 6055 and 6056 Returns and Statements - Recorded
October 16, 2013 WEBCAST
(Thomson Reuters / EBIA)

Affordable Care Act 101 Webinar
October 24, 2013 WEBCAST
(U.S. Small Business Administration (SBA))

Retirement Plan Insights Seminar
November 12, 2013 in NV
(McKay Hochman Co., Inc.)

Retirement Plan Insights Seminar
November 25, 2013 in MD
(McKay Hochman Co., Inc.)

View All Webcasts and Conferences


  LinkedIn   Twitter   Facebook Hand-picked links to the web's best news articles,
official guidance, jobs, webcasts and more.
[Guidance Overview]

Retirement Plan Year-End Action Items
"[A] non-exhaustive list describes year-end action items and the annual notices for retirement plans that must be distributed within a reasonable time prior to the start of the plan year. For calendar year plans, providing the notices [in this list] by December 1 will meet this requirement in most cases.... Cycle C plans (governmental plans and plans whose sponsor's EIN ends in 3 or 8) must be submitted to the IRS for a favorable determination letter by January 31, 2014." (Haynes and Boone, LLP)  


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Who Gets Retirement Plans and Why, 2012 (PDF)
"Of those most likely to desire to save for retirement in the current year, nearly three-quarters had access to a pension plan through their own employer or their spouse's employer, and 93 percent of those with access participated ... Although only 17 percent of workers at firms with fewer than 10 employees have an employer that sponsors a plan -- compared with 68 percent of workers at firms with 1,000 employees or more -- if a firm sponsors a plan, approximately 80 percent of employees participate, regardless of firm size[.]" [Supplemental tables (XLS) are also provided.] (Investment Company Institute [ICI])  

International Paper Pays $30 Million Over 401(k) Claims
"The claim alleged that International Paper maintained its own publicly traded stock as an investment option, paid 'excessive' fees for record keeping and investment management, and 'fraudulently' reported performance histories for the plans' funds. The plaintiffs also claimed that the company improperly delayed making contributions to the plans and retained interest earned on those contributions for corporate accounts, according to the settlement. International Paper, which was the plans' sponsor, denied all the claims." (The Wall Street Journal; subscription may be required)  

House Committee Hearing on the Challenge of Retirement Savings for Small Employers
Page includes links to testimony by: Catherine Collison, President, Transamerica Center for Retirement Studies, Los Angeles, CA.; Paula A. Calimafde, Bethesda, MD; C. Roy Messick, III, CPA, QPA, TPP Retirement Plan Specialists, LLC, Overland Park, KS; Ray Rucksdashel, Chief Financial Officer, Quest-Tec Solutions, Inc, Houston, TX. (Committee on Small Business, U.S. House of Representatives)  

In Sickness and in Health: Reforming U.K. Pensions and Social Care (PDF)
"Savers should be permitted to earmark part of their pension rights in advance of retirement to provide for care. There should be no compulsion to do so.... Any capital within a pension plan which is earmarked to provide for care ... should be protected if the member dies before the care need arises and the funds for care are not used.... Pension payments to appropriate care providers should be included within the authorised payment regime. Flexible benefit structures within the workplace should be designed to allow for these new care saving options." (Squire Sanders)  


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Federal Judge Lifts Stay on Suit Over Extra Detroit Pension Checks
"The federal judge overseeing Detroit's bankruptcy petition has granted a union's request to allow it to continue a fight for extra pension checks.... In 2011, the City Council ended the pension system practice of issuing bonus checks. The union says that it should have been handled in collective bargaining. A labor judge earlier ruled the City Council was wrong when it cancelled the practice of the so-called 13th check." (CBS Detroit)  

Projected Section 415 and Other Limits for 2014
"[W]ith the federal government closed, the new maximum retirement plan and other employee benefit plan limits that fluctuate based on the cost of living will not be announced just yet. However, Tom Poje of DCS Retirement Group has helpfully provided us with projections of what several of the 2014 limits will be." (Calhoun Law Group)  

Inheriting a Retirement Account
"A spousal beneficiary has two options when it comes to an inherited retirement account: the spouse can either (1) keep the IRA under the deceased spouse's name with the surviving spouse remaining as the beneficiary, or (2) make an affirmative election to treat the inherited account as his/her own. The benefits of each option vary, so the beneficiary must choose the option which best fits his/her particular circumstances. A non-spousal beneficiary, however, does not have the option to treat the Inherited IRA as his or hers, but can treat it only as an Inherited IRA." (Belfint Lyons & Shuman, CPAs)  

Funded Status of U.S. Corporate Pensions Rises to 91.0 Percent in September
"Rising equities in the U.S. and international markets lifted the funded status of typical U.S. corporate pension plans 2.9 percentage points to 91.0 percent in September, the first time they have topped that level since June 2011 ... For September, the rise in equities contributed to the 3.1 percent increase in assets for the typical U.S. corporate pension plan ... Liabilities for these plans fell 0.2 percent ... Year to date, the funded ratio for corporate pension plans is up 13.9 percentage points[.]" (BNY Mellon)  

Pension Finance Update as of September 30, 2013 (PDF)
"The good times for pension plans returned in September. The combination of solid returns in the stock market and stable interest rates improved funded status last month. The two 'model' plans we track each saw improvements, with traditional 'Plan A' gaining more than 3% while the more conservative 'Plan B' improved 1%. For the year, Plan A has gained an astonishing 19% and Plan B is up almost 5%" (October Three Consulting)  

FTSE350 Pension Deficits -- Two Steps Forward, Two Steps Back
"Pension scheme accounting deficits for FTSE350 companies were 98bn GBP at 30 September 2013, corresponding to a funding ratio of assets over liabilities of 85%. Deficits remained unchanged over the month, but only after reaching an intra-month low of 78bn GBP and a funding level of [89%]. As at 31 December 2012 pension deficits stood at 73bn GBP (corresponding to a funding level of 88%)." (Mercer)  

While Others Underfunded Pensions, Milwaukee Held Firm
"Across the country, cities with pension plans for their workers are struggling to pay out the promised funds. Some municipalities have raided retiree savings to pay for other services during the downturn, while others have simply underfunded them. But despite a 30 percent poverty rate, declining tax base and huge foreclosure crisis, Milwaukee has a model pension program and has managed to keep its promises to retirees." (National Public Radio)  

Change in Average 401(k) Account Balances as of October 1, 2013 (PDF)
Report shows change in average account balances grouped by age and tenure, from January 1, 2011 through September 1, 2013. (Employee Benefit Research Institute [EBRI])  

Why Passive Investing Gets Better in Retirement
"Many people wonder whether they should choose passive or active funds for their portfolio.... The data strongly points to higher risk-adjusted returns for passive portfolios. Passive portfolios also have a variety of other advantages that will become even more pronounced once my retirement years roll around, which is precisely the time when I need my money to work for me the most. Here are a few reasons passive investing works incredibly well in retirement[.]" (David Ning in U.S.News & World Report)  

SEC Advisory Panel Proposal Calls for Tough Fiduciary Standard
"A subcommittee of the Investor Advisory Committee is recommending that the SEC proceed with a rule mandating that brokers put the best interests of their clients before their own when providing retail investment advice -- the standard that advisers meet. The group wants the SEC to develop the rule by narrowing the broker-dealer exclusion from the Investment Advisers Act of 1940. Certain sales-related conflicts of interest would be permitted if they're disclosed and managed." (InvestmentNews)  

[Opinion]

Why I'm a Fiduciary
"[A] fiduciary is someone who protects those (with whom the fiduciary has a legal relationship) that are not in a position, for whatever reason, to protect themselves.... Assuming the fiduciary responsibilities and associated liabilities of being an ERISA-defined 3(38) investment manager produces ... the biggest bang for the buck in bringing real fiduciary protection to participants (and their beneficiaries), which are, it should always be remembered, the center of the ERISA universe." (W. Scott Simon in Morningstar Advisor)  

[Opinion]

Pension Lessons From Down Under? Hardly.
"Should the U.S. follow Australia and scrap defined-benefit plans to replace them with defined-contribution plans? According to the WSJ, yes, this is the answer to America's fiscal woes.... Apart from promoting more myths on public pensions, the article fails to mention that Australia's retirement system is far from perfect. In fact, if you look at the latest statistics on poverty, it's a miserable failure[.]" (Pension Pulse)  

[Opinion]

How to Fix Big Flaws with 401(k) Plans
"According to one study, 91 percent of plan sponsors view [their defined contribution plans] as savings plans, while only 9 percent view them as vehicles for providing retirement income. A cultural shift is needed: Employers and plan sponsors need to commit to operating their 401(k) plans not just as a way to save for retirement but as plans that help employees before and during their retirement." (CBS MoneyWatch)  

[Opinion]

Text of Comments by Investment Company Institute to IRS on Annual Return/Report of Employee Benefit Plan (Form 5500) (PDF)
"[We] recommend that IRS and the [DOL] harmonize the requirements of Schedule C of Form 5500 with the DOL 408(b)(2) service provider disclosure regulation, which was effective July 1, 2012. Specifically, we suggest that IRS and DOL allow the Schedule C requirements for mutual funds and other similar pooled investments to be satisfied by using the information required by the 408(b)(2) regulation in lieu of the current Schedule C requirements." (Investment Company Institute [ICI])  

Benefits in General; Executive Compensation

[Official Guidance]

FASB Ratifies Consensus-For-Exposure on Issue 13-D: 'Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period'
"A performance target that could be achieved after the requisite service period should be treated as a performance condition that affects the vesting of the awards.... [C]ompensation cost would be recognized if it is probable that the performance condition will be achieved.... The amendments in the proposed Update would be applied prospectively to share-based payment awards granted or modified on or after the effective date. Early adoption would be permitted." (Financial Accounting Standards Board [FASB])  

[Guidance Overview]

State Exemptions for Religious Organizations After the DOMA Decision and Revenue Ruling 2013-17
"Most states that recognize same-sex marriage exempt religious organizations from the application of statutes that prohibit discrimination based on sexual orientation.... [T]hese state exemptions appear to give religious organizations the right to refuse equal employment benefits to employees in same-sex marriages despite the Service's guidance. Questions remain, however, regarding the scope of these exemptions and whether they would survive constitutional scrutiny.... [M]any of the state exemptions do not define with specificity what constitutes a 'religious' organization." (Verrill Dana LLP)  

[Guidance Overview]

SEC Proposes Pay Ratio Disclosure Rules
"The SEC believes that this flexible approach will reduce the cost of compliance. It acknowledges this approach will limit the comparability of disclosure across reporting companies, noting that precise conformity of ratios across companies is not necessary because it believes the pay ratio is aimed at providing investors with a company-specific metric to evaluate the PEO's compensation within the context of his or her own company." (Michael Best & Friedrich LLP)  

Supreme Court Will Decide Whether FICA Tax Applies to Severance Pay
"Employers who have made severance payments pursuant to a plan because of a reduction in force should strongly consider filing refund claims ... The statute of limitations for post-2009 quarterly tax periods is open. The limitations period for 2010 quarterly tax periods terminates on April 15, 2014. Because Quality Stores most likely will be decided after that date, the refund claims should be filed on a protective basis." (Faegre Baker Daniels LLP)  

Press Releases

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