McKay Hochman

Pension Administrator/Employee Benefits Consultant
CliftonLarsonAllen LLP
in IL

Part Time On Call Retirement Education Specialist
BlueStar Retirement Services
in ANY STATE, FL, KS, NY, TX, WI

Daily Operations Associate
Alliance Benefit Group of Michigan
in MI

Client Service Manager, Defined Benefit
The Newport Group
in FL, WI

Implementation Project Manager
The Newport Group
in FL

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HIPAA HITECH 101
February 3, 2014 WEBCAST
(Clearwater Compliance)

Small Business Health Options Program (SHOP) Webinar Series I
February 11, 2014 WEBCAST
(Centers for Medicare & Medicaid Services (CMS))

Affordable Care Act 101 Webinar
February 13, 2014 WEBCAST
(U.S. Small Business Administration (SBA))

4th Annual Leadership Summit on Ancillary Products and Voluntary Benefits
March 11, 2014 in FL
(World Congress)

View All Webcasts and Conferences

[Official Guidance]

Text of Presidential Memorandum to Secretary of the Treasury -- Retirement Savings Security
"(a) By December 31, 2014, you shall finalize the development of a new retirement savings security that can be made available through employers to their employees. This security shall be focused on reaching new and small-dollar savers and shall have low barriers to entry, including a low minimum opening amount. In developing this security, you shall ensure that it: (i) protects the principal contributed while earning interest at a rate based on yields on outstanding Treasury securities; (ii) offers savers the flexibility to take money out if they have an emergency and keep the same Treasury security if they change jobs; and (iii) is designed to help savers start on a path to long-term saving and serve as a stepping stone to the broader array of retirement products available in today's marketplace. (b) Within 90 days of the date of this memorandum, you shall begin work with employers, stakeholders, and, as appropriate, other Federal agencies to develop a pilot project to make the security developed pursuant to subsection (a) of this section available through payroll deduction to facilitate easy and automatic contributions." (The White House)  

[Advert.]

Lightning-Fast PPA Auto-Restatements

ASCi's Auto-Restatements give you the easiest, most efficient, least expensive plan document restatement cycle ever. See for yourself! Click here.

[Guidance Overview]

PBGC Proposes Rule Reducing Reporting Obligations for Certain Multiemployer Plans
"Under this proposed rule, the current PBGC reporting requirements applicable to plan sponsors of multiemployer plans may be reduced in the event of a plan merger or termination. Employers engaged in corporate transactions involving plan sponsors of small, terminated or insolvent multiemployer plans should review this guidance to determine whether the reduced reporting requirements apply to the plans affected by the transaction." (Practical Law Company)  

[Guidance Overview]

IRS Issues Final Regs to Allow Mid-Year Elimination of Safe Harbor Nonelective Contributions (PDF)
"Now that the rules appropriately align for matching and nonelective safe harbor contributions, all employers offering safe harbor plans should add the language ... to their next safe harbor notices in order to provide maximum flexibility in order to make mid-year changes to the employer contributions. Failure to do so results in the need to demonstrate that the employer is operating at a loss to permit the amendment; the other factors that showed a financial hardship ... are no longer relevant." (Groom Law Group)  

Can Obama's 'MyRA' Lure Workers Who Don't Save for Retirement?
"President Obama picked a good venue to boost the 'MyRA' retirement savings accounts he touted in last night's State of the Union address. He spoke at a U.S. Steel plant in Pennsylvania, a state where the public pension system has a $47 billion shortfall and where workers would be right to worry about running out of money as they age." (Bloomberg BusinessWeek)  

Treasury to Pick Investment Manager for Obama myRA Retirement Program
"President Barack Obama's new 'myRA' retirement savings program will be run by a private-sector money management firm chosen by the U.S. Treasury Department from a field of up to 30 firms, [according to] a senior administration official ... In a competitive bidding process to begin in the next few weeks, the Treasury Department will select a firm with experience in handling Roth individual retirement accounts (IRAs) ... The time frame was not clear, with the official saying only that selection would take place in months ahead." (Reuters)  

[Advert.]

National Conference on ESOPs and Stock Plans: April 2014

If you work with employee stock ownership plans (ESOPs) or equity compensation plans, the annual Employee Ownership Conference from April 7 to 10 in Atlanta will keep you up to date on legal issues, best practices, emerging trends, and much more!

White House Fact Sheet: 'Securing a Dignified Retirement for All Americans'
"About half of all American workers do not have access to employer-sponsored retirement plans like 401(k)s, which puts the onus on individuals to set up and invest in an Individual Retirement Account (IRA). Up to 9 out of 10 workers automatically enrolled in a 401(k) plan through their employer make contributions, even years later, while fewer than 1 out of 10 workers eligible to contribute to an IRA voluntarily do so.... Employers that do not provide any employer-sponsored savings plan would be required to connect their employees with a payroll deduction IRA. This proposal could provide access to one-quarter of all workers[.]" (The White House Blog)  

The Logic Behind Obama's New 'Starter Savings Account'
"The MyRA option ... sounds a little similar to the health-care law, in that the goal is to encourage participation at the lower end of the market -- especially part-time workers, only 37 percent of whom have access to a retirement savings plan, and those working for small employers, where the number is 49 percent. Unlike the health-care law, it's entirely voluntary and doesn't depend on broad participation in order to create market power that could bring down costs." (The Washington Post; subscription may be required)  

A Guide to Obama's Plan for Retirement Savings
"Most workers won't save adequately for retirement, many retirement experts say, unless they are automatically enrolled in savings programs and forced to opt out if they don't want to save. MyRA is completely voluntary. Others worry that savers can withdraw money freely. The possibility that savers will deplete the accounts before retirement makes MyRA a 'woefully inadequate response to the retirement crisis,' says Teresa Ghilarducci, a retirement specialist at the New School for Social Research in New York." (The Washington Post; subscription may be required)  

Harkin Unveils Legislation to 'Address Retirement Crisis, Rebuild Private Pension System'
"[Senator Tom] Harkin's legislation would create a new type of privately-run retirement plan that combines the advantages of traditional pensions -- including lifetime income benefits and pooled, professional management -- with the portability and ease for employers of a 401(k). The key features of USA Retirement Funds include: [1] Universal Coverage: USA Retirement Funds would be available to everyone, including the more than 61 million people without access to a workplace retirement plan and the 14.5 million people who are self-employed; [2] Automatic Enrollment: Employees would be automatically enrolled at a rate of 6 percent per year, but could choose to raise, lower, or stop their contributions; [3] Secure Lifetime Income: Benefits would be paid monthly for life, and participants would be shielded from market volatility and other risks; [4] Lower Costs: Pooled, professional management and risk sharing will reduce the cost of retirement by up to 50 percent; [5] Portability: People would be able to take their benefit with them as they change employers [and] [6] Simple and Easy for Businesses: Small businesses can easily participate and would not have to take on risk or undue administrative burden." (Committee on Health, Education, Labor and Pensions, U.S. Senate)  

Sen. Harkin Pitches Private Pension Reform
"U.S. workers would be automatically enrolled in a new private pension system that would help them stash 6 percent of their pay each year under a proposal Democratic U.S. Sen. Tom Harkin of Iowa [announced] today.... Employers wouldn't have to contribute any money unless they wanted to, but they'd handle the payroll deductions. There would be no government obligation for contributions to the privately run plans. And employees could choose to opt out." (Des Moines Register)  

State Pension Obligations Can Be Crushing, But Corporate Tax Breaks Cost More
"If you just look at the steeply climbing trajectory of Pennsylvania's pension costs, it does appear that some sort of drastic action is necessary -- and with all other budgets squeezed to the bone, perhaps public employees should be asked to pay for the miscalculations of politicians past... There is, however, another big expense that tends to get overlooked: The tax breaks states already hand out to corporations, on the theory that they won't stick around without them. In Pennsylvania, they amount to about $3.9 billion per year -- several times the $1.4 billion that the state needs to contribute in order to make good on its pension obligations." (The Washington Post; subscription may be required)  

Senate Passes Bipartisan Legislation to Enable Charities and Cooperatives to Avoid PPA Funding Restrictions
"The Cooperative and Small Employer Charity Pension Flexibility Act of 2013 would ensure that charitable and cooperative associations are not swept into the Pension Protection Act of 2006 (PPA) funding rules, which would require them to divert funds from critical services and jeopardize their ability to provide pension benefits to their workers." (Committee on Health, Education, Labor and Pensions, U.S. Senate)  

SEC Commissioner Piwowar Talks Fiduciary Definition, Money Fund Reform
"Michael Piwowar acknowledged that research has shown investors are confused by the differing advice standards that brokers and investment advisers must meet. But he said he isn't sure that if investors don't understand the distinction -- financial advisers must act in their best interests while brokers meet a less stringent suitability standard -- that the remedy is a new regulation forcing brokers to meet a higher bar.... 'From my perspective, the fiduciary duty issue is really, really, really hard,' said Mr. Piwowar[.]" (InvestmentNews)  

The Lost Art of Plan Design: Origins of Fiduciary Liability
"The commoditization of plan documents has become so engrained in the industry that rarely does the plan sponsor's management or its board have the draft plan reviewed by independent legal counsel before approving it, accepting on faith the bulk of a complex standard form document on the advice of a service provider who is acting neither as an attorney nor a fiduciary and who possesses little, if any, institutional knowledge about the plan sponsor. Besides ending up with a sub-optimal plan design, such a process places fiduciaries ('clueless' or otherwise) in untenable positions." (Philip J. Koehler, Esq. for ERISA Fiduciary Administrators)  

Hot Topics in Retirement: Building a Strategic Focus in 2014 (PDF)
"Twenty-four percent of plan sponsors have recently conducted an asset liability study to provide a picture of the plan under different economic conditions. Close to half of all remaining sponsors are very or somewhat likely to perform a study in the upcoming year.... Twelve percent of employers with defined benefit plans recently liberalized their lump-sum option by focusing on terminated vested participants or retirees through a window approach. Of the remaining group, 14% are very likely to follow suit in the next 12 months." (Aon Hewitt)  

[Opinion]

Obama's MyRA Nest Egg? That's It?
"Folks, let me be blunt, MyRA will do absolutely nothing to bolster America's retirement system which is a miserable failure. The majority of Americans are falling through the cracks, unable to save for retirement, and for those that do manage to save something, they are living a 401(k) nightmare, anxious about retirement, or falling prey to sharks peddling loan advances to pensioners. It's the biggest scandal in modern times and yet no politician, including the president of the United States, is doing one damn thing about it." (Pension Pulse)  

[Opinion]

Investment Advisers Skeptical About Obama's 'myRA' Proposal
"Although encouraging more retirement savings is 'noble,' the opt-in feature will undermine myRAs' effectiveness, said George Papadopoulos, owner of an eponymous investment advisory firm.... 'It's not going to go anywhere. It adds to the alphabet soup of all the different kinds of IRAs,' Mr. Papadopoulos said.... It is ironic that Mr. Obama touted the growth of the stock market over the past five years just before introducing a retirement plan based on government bonds, said John Hauserman, president of RetirementQuest Wealth Management.... 'It's not a good long-term portfolio prescription for the majority of people, particularly those who are low- and middle-income and need long-term growth,' he said. 'He proposes a retirement plan that won't let people be in the stock market.'" (InvestmentNews)  

[Opinion]

Statement from EBRI in Response to President Obama's Retirement Plan Proposals (PDF)
"EBRI has no comment on the president's most recent retirement proposals because there is not yet enough detail about them to conduct an informed analysis. Without more specifics, EBRI will not speculate about possible effects of the plan. In his speech, the president did refer to 'an upside-down tax code that gives big tax breaks to help the wealthy save, but does little to nothing for middle-class Americans.' EBRI has conducted analysis of the tax preferences for 401(k) plans, and concluded that, after controlling for age and tenure, 'actual 401(k) account balances are found to be, in large part, proportionate with compensation levels[.]'" (Employee Benefit Research Institute [EBRI])  

[Opinion]

MyRA Reminds Us There's Plenty of Room for Improvement in the Retirement System
"The primary incentive to encourage retirement saving has traditionally been the tax break. But that's not an effective way to address the coverage gap and, in any case, is not an area where the government currently has much flexibility. So it's natural to look for other ways to encourage more participation. Nudging -- the structuring of choices to encourage a particular outcome -- is one; hence the persistence of the auto-IRA idea, which was also highlighted in the President's address. MyRAs are another." (Russell Investments)  

[Opinion]

Text of Letter from American Benefit Council to Sen. Collins in Support of Retirement Security Act of 2014 (PDF)
"We believe the bill's reforms of the multiple employer plans rules will expand opportunities for small businesses to band together to maintain plans at a lower cost. In particular, we applaud the provision that would prevent an entire multiple employer plan from being disqualified by reason of a violation of the qualification rules by one or more participating employers. This inappropriate result under current law can deter many small employers from joining a multiple employer plan." [Text of the proposed legislation as introduced by Sen. Collins.] (American Benefits Council)  

[Opinion]

Text of Letter from American Benefits Council to Secretary of Commerce on Continued Access to Social Security Death Master File (PDF)
"Use of the [death master file (DMF)] information is critical to the efficient functioning of all types of retirement plans ... [M]ny plan benefits are paid in the form of life or joint life annuities. Without DMF information, plans would not have the information needed to make payments to the correct recipients in the correct amounts ... Other plans need DMF information for other purposes, such as determining when a plan beneficiary becomes eligible for benefits.... In this regard, we would like to thank you for issuing a notice clarifying that pending establishment of a certification program, user access to the DMF will continue uninterrupted under the current process." (American Benefits Council)  

[Opinion]

Text of Comments from ACLI on Retirement Security Initiative Announced During State of the Union
"While most Americans receive retirement plan coverage through the workplace, not all employers are in a position to offer such a benefit. That is why ACLI strongly supports proposals to offer small employers 'Starter 401(k) Plans' and improvements to auto enrollment rules. If adopted, these proposals could be especially helpful in expanding coverage to workers at small businesses, which include many part-time workers. Small businesses frequently lack the resources required for plan sponsorship." (American Council of Life Insurers [ACLI])  

[Opinion]

Retirement Security Highlighted by President Obama (PDF)
"Mercer supports efforts to ensure that tax treatment is fair and to support retirement savings among all workers. We stress the importance of current tax incentives, which are powerful tools for encouraging employers to make these programs available to their employees. Care must be taken to avoid erosion of sponsorship among employers. Expansion of the existing saver's tax credit could help accomplish tax-equity goals without detriment to current program" (Mercer)  

'An ERISA Claim Walks Into a Bar ...' -- A Follow-up on Heimeshoff V. Hartford Life
"The Court further stated that even in the rare cases where internal review prevents participants from bringing ERISA 502(a)(1)(B) actions within the contractual period, 'courts can apply traditional doctrines that may nevertheless allow participants to proceed. If the administrator's conduct causes a participant to miss the deadline for judicial review, waiver or estoppel may prevent the administrator from invoking the limitations provision as a defense.'" [Heimeshoff v. Hartford Life and Accident Ins. Co., No. 12-729 (S. Ct. Dec. 16, 2013)] (Bloomberg BNA)  

Tying a Windsor Knot (PDF)
"Proponents of same-sex marriage had momentum on their side in 2013 as the Supreme Court struck down parts of the Defense of Marriage Act and overturned California's Proposition 8, and five state legislatures legalized same-sex marriage. In addition, New Jersey and New Mexico state courts decided marriage licenses cannot be denied to same-sex couples, while federal court rulings striking down Oklahoma's and Utah's bans on same-sex marriage are on hold pending appeal. In light of these developments, employers need to ensure that they have made all necessary changes to their retirement and employee benefit plans and their employment policies to reflect the changing legal landscape." (Buck Consultants)  

Supreme Court Says Clock for Appeal of ERISA Decision Began Running Sooner Than Plaintiff Expected
"ERISA section 502(g) entitles an ERISA litigant to ask for an award of fees if the litigant can demonstrate that it has achieved 'some degree of success on the merits', and motions to recover those fees will certainly continue. However, the decision in [Ray Haluch Gravel Co. is a strong reminder that the Supreme Court believes that the requirements of federal procedure are important, and that failure to comply with them could result in the loss of important rights and claims under ERISA. The practical outcome of Ray Haluch Gravel Co. is likely to be filings of appeal notices earlier in the proceedings, with subsequent requests to consolidate appeals of any later decisions relating to fees and costs." (Williams Mullen)  

Recent Trends in Federal Civilian Employment and Compensation
"[Of] the 1.96 million permanent career employees on board as of September 2012, nearly 270,000 (14 percent) were eligible to retire. By September 2017, nearly 600,000 (around 31 percent) will be eligible to retire, government-wide. Spending on total government-wide compensation for each full-time equivalent (FTE) position grew by an average of 1.2 percent per year, from $106,097 in 2004 to $116,828 in 2012. Much of this growth was driven by increased personnel benefits costs, which rose at a rate of 1.9 percent per year." (U.S. Government Accountability Office)  

Alert: Don't Miss April 15 Deadline to File a Protective Refund Claim for 2010 FICA Tax on Severance Payments
"Taxpayers may be entitled a FICA tax refund if the [Quality Stores] decision is upheld by the Supreme Court on appeal. In order to preserve the right to a refund, taxpayers must file a protective claim before the applicable statute of limitations runs.... [T]he deadline to file a protective order for severance payments made in 2009 was April 15, 2013. At this time, the deadline to file a protective claim for 2010 severance payments is quickly approaching on April 15, 2014." (Benefits Bryan Cave)  

Director/Investor Survey Reveals Executive Pay Issues Requiring Closer Attention from Boards and Management
"[W]hile perspectives on some aspects of executive compensation depend on whether you sit in the boardroom or in the seats reserved for shareholders, a closer look at the survey findings also points to a number of pay issues on which directors and investors are clearly on the same page. Among the most noteworthy is the general alignment of director and investor views regarding opportunities to further improve the executive pay model in U.S. companies. Key areas for improvement include: [1] More disciplined incentive target setting; and [2] Enhanced disclosure of pay-for-performance alignment." (Towers Watson)  

ING U.S. Hires Stephen F. Keating to Lead Large Corporate Market Sales
ING U.S.

Pension Rights Center Calls MyRAs “A First Step” Leading to Comprehensive Solutions to the Retirement Crisis
Pension Rights Center

IRS Announces New Internal Revenue Service Advisory Council Members
Internal Revenue Service (IRS)

Pension Rights Center Applauds Senator Harkin’s New Retirement Proposal
Pension Rights Center

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