Retirement Plans Newsletter

September 9, 2014

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Employee Benefits Jobs

Employee Benefits Sales Consultant
Nyhart
in IN

401(k) Compliance Administrator
The Savitz Organization
in ANY STATE, PA

Associate Vice President & Regional Sales Consultant
United Retirement Plan Consultants
in WA

Retirement Director
Tacoma Employees' Retirement System - Tacoma, WA
in WA

Salesperson
Pension Advisors
in OH

Director of Compliance
ftwilliam.com - Wolters Kluwer
in ANY STATE

Retirement Plan Coordinator
T. Rowe Price
in MD

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Webcasts and Conferences

Building Resilience Through Brain Health
September 24, 2014 in IL
(Worldwide Employee Benefits Network [WEB] - Chicago Downtown Chapter )

Filing Health Care Reform Forms 1094 and 1095: Line-by-Line Guidance on the IRS Forms and Instructions
October 2, 2014 WEBCAST
(Thomson Reuters / EBIA)

Payer Strategies to Manage the Impending Flood of Costly Specialty Drugs
October 6, 2014 WEBCAST
(Atlantic Information Services, Inc)

ACA Plan Sponsor Roadmap for 2015 - Current and Upcoming Compliance Challenges
October 10, 2014 WEBCAST
(MCOL)

Translate 2015 Star Ratings Into Your Plan’s New MA/Part D Strategies
October 30, 2014 WEBCAST
(Atlantic Information Services, Inc)

View All Webcasts and Conferences



IRS Allows Spouses to Roll Inherited IRAs Through Own Trusts to Their IRAs
"In private letter rulings (PLRs) 201430026 and 2014130029, IRS allowed the surviving spouses to roll their inherited IRAs through a trust to their own IRAs. The twist here is that the trust beneficiary was the spouse's own trust, not a trust established by the decedent." (Slott Report)  


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Target Date Funds: It's Time for Plan Sponsors to Take a Careful and Cautious Look (PDF)
"Given the rise of open architecture (the ability to select investments not managed by the recordkeeper) within defined contribution plans, plan sponsors should carefully consider which fund series would best suit the needs of their participant group as a whole. This additional analysis will benefit the participants and help to limit liability on the part of the plan sponsor." (PlanPILOT)  

The Facts About Pension Advances
"Businesses marketing pension advances attempt to avoid state and federal regulation by claiming that pension advances are not loans. However, regulators are beginning to examine the practice to determine if it violates disclosure and interest rate laws. Missouri and Vermont have passed legislation to regulate the marketing and sale of pension advances. Other states are considering similar legislation." (Pension Rights Center)  

Seventh Circuit Finds Trustees' Conflicting Interpretations of 'Retirement' to Be 'Paradigmatically' Arbitrary and Capricious
"Was cessation of contributions on a participant's behalf enough to render him 'retired' or did the participant also need to cease Covered Employment? The record of the trustees' reasoning indicates they failed to acknowledge the existence of this ambiguity, the court said.... Confronted with this suggestion, the trustees argued they could interpret the defined term 'retirement' differently for different plan provisions. 'To interpret the same defined term in two different ways in this manner is paradigmatically arbitrary and capricious,' the court concluded." [Schane v. Int'l Brotherhood of Teamsters Union Local No. 710 Pension Fund Pension Plan, No. 13-3745 (7th Cir. July 23, 2014)] (Wolters Kluwer Law & Business)  

Fiduciary Aspects of Using Expert Networks
"[An] individual with a fiduciary duty to trust beneficiaries (such as a pension plan investment committee member) should be asking [a hedge fund into which the trust is considering an investment] about how it uses expert networks. One might even assert that it would be bad business to avoid experts if the compliance and governance boxes have been checked off and there is a robust infrastructure in place about appropriate knowledge-sharing." (Good Risk Governance Pays)  


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Constructing an Investment Menu for a Participant-Directed Retirement Plan
"[Plan sponsors are encouraged] to consider the propensity for participant 'home bias' (the natural desire to invest in things close to home) and to engage in 'naive diversification' (the random spreading of investments over a broad array of choices offered) when constructing an investment menu.... As a retirement plan fiduciary, understanding how to best deal with the realities of participant behavior is both necessary and likely to lead to better outcomes." (Francis Investment Counsel LLC)  

More Americans Interested In Seeking Financial Advice
"[T]wo-thirds of Americans who have received financial advice feel optimistic about their finances, and 86 percent act on financial advice after they receive it. Sixty-two percent of respondents report changing their spending habits after receiving financial advice, and 46 percent increased the amount they contribute to their retirement." (TIAA-CREF)  

CPAs Sue to Stop PTIN Fees
"Two CPAs have filed suit in the U.S. district court for the District of Columbia, asking the court to stop the IRS from charging fees for issuing preparer tax identification numbers (PTINs), to obtain refunds of fees paid in the past, and to enjoin the IRS from asking for more information than needed to issue preparer tax identification numbers (PTINs). The plaintiffs are asking for class certification for all return preparers who are required to pay the user fee, which they estimate ranges from 700,000 to 1.2 million people." (Journal of Accountancy)  

Reviewing Retirement Plan Tablet Apps
"Tablet-optimized apps, although uncommon, are an effective and convenient way for participants to access their pertinent retirement account information and related educational content. Each of the three account-specific tablet apps [reviewed by the authors] provides participants with three key data points -- total plan balance, balances by investment held and rate of return -- and also supplement the retirement plan details with colorful charts and graphs that depict asset allocation breakdowns, balances over time and personal performance. Additionally, two of the apps also provide participants with a detailed transaction history." (Corporate Insight)  


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Sponsored by PSCA [Plan Sponsor Council of America]

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Pension Funds Join Lawsuit Against Stock Exchanges Over High-Frequency Trading
"A group of pension funds has joined with the City of Providence, R.I., in a lawsuit that claims that major stock exchanges improperly favored high-frequency traders at the expense of other investors.... The pension funds and Providence, which are seeking class-action status, claim the exchanges ran afoul of their legal duties by providing certain advantages to high-frequency traders, 'diverting billions of dollars annually from buyers and sellers of securities and generating billions more in ill-gotten kickback payments.' They are seeking an unspecified amount of damages." (The New York Times; subscription may be required)  

Designing a Portfolio Plan for Life
"[In] the vast majority of actual and hypothetical market environments an investor could experience over his or her lifetime, a 'through' strategy appears to have more potential to accumulate greater wealth at retirement than a 'to' approach. In some cases, the difference was significant." (Fidelity)  

[Opinion]

'Vanity Paper' Purporting to Solve 401(k) Fiduciary Issues Is Met with Criticism
"[Two University of Rochester authors recently explained] why the current American retirement environment needs to be fixed and then, based in part what they see as advantages of retirement policies in other countries, make six recommendations regarding our nation's retirement policy. Despite the press, which is rare for an industry white paper, the reaction among industry veterans was quite blunt and pointed." (Fiduciary News)  

Press Releases

Aspire Unveils Enhanced 403(b) Portal
Aspire Financial Services

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