ASPPA

Compliance Consultant
Pinnacle Financial Services, Inc.
in FL

DC Pension Administrator
Pension Consultants, Inc.
in CT

Employee Benefits Administrator
The National Bank & Trust Company
in IL

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HIPAA-HITECH 101
January 16, 2015 WEBCAST
(Clearwater Compliance)

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NIPA [National Institute of Pension Administrators]

[Guidance Overview]

IRS Advisory Committee Asks 403(b) Plan Sponsors and Service Providers to Participate Now in Confidential Online Survey About Plan Compliance Issues
The Employee Plans subgroup of the IRS Advisory Committee on Tax Exempt and Government Entities would like input from the 403(b) plan community -- plan sponsors and vendors/providers alike -- regarding the problems they face/see in administering 403(b) programs and what steps/actions they think the IRS could take to help facilitate the compliance process. Click here to participate in the survey (all responses are anonymous and will not be sent to the IRS). (Employee Plans Subgroup, IRS Advisory Committee on Tax Exempt and Government Entities)  

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[Guidance Overview]

IRS Employee Plans News 2014-23, December 16, 2014 (PDF)
Topics include: [1] Certain funding elections for Cooperative and Small Employer Charity Act and eligible charity plans due December 31 2014; and [2] Informational Forms 5500 and 5500-SF, and final Form M-1. (Internal Revenue Service [IRS])  

[Guidance Overview]

Employers Should Prepare Now for Big Changes Coming to Multiemployer Pension Plans
"[E]mployers who have collective bargaining agreements that require contributions to multiemployer pension funds should begin analyzing the potential impact now ... Review the current funded status of each multiemployer pension fund. Request an updated withdrawal liability estimate from each multiemployer pension fund and all supporting documentation ... Consider making inquiries through the fund's employer trustees as to whether the fund will implement any of the changes under the Act.... Review any public statements that union representatives have made regarding the changes under the Act, whether in support of or against such changes.... Re-evaluate the company's risks of continuing to participate in the fund and adjust collective bargaining strategy accordingly." (Polsinelli PC)  

[Guidance Overview]

Tax Extenders Reinstated Temporarily
"In its final form, the legislation 'patches' the tax extenders for one year, retroactively reinstating a wide range of provisions that technically lapsed at the end of 2013, to now be available for the current 2014 tax year. This includes the popular rule allowed those over age 70-1/2 to make a qualified charitable distribution (QCD) from an IRA, satisfying the current year's required minimum distributions while simultaneously completing a charitable bequest and excluding the IRA distribution from income entirely for tax purposes, with just enough time left to complete a QCD before year end." (Michael Kitces in Nerd's Eye View)  

[Guidance Overview]

Overview of the Multiemployer Pension Reform Act of 2014 (PDF)
8 pages. "Significant changes the Act makes include the following: [1] Repeals the sunset provisions of the Pension Protection Act of 2006; ... [2] Limits the effect that future required contribution increases will have on employer withdrawal liability; [3] Adds to the list of documents that a plan is required to provide to participants, beneficiaries, unions or employers upon request; [4] Increases PBGC premiums to be paid by multiemployer pension plans; ... [5] Modifies rules regarding mergers of plans and partitioning of plans by the PBGC; [6] Adds a new zone status for seriously underfunded plans called 'Critical and Declining' and allows a plan in that status to cut some previously protected benefits; [7] Extends PBGC guarantees to some pre-retirement death benefits." (Dexter Hofing LLC)  

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Text of Superseding Ninth Circuit Opinion: District Court Directed to Consider Surcharge as Equitable Remedy Where Benefits Paid in Error (PDF)
37 pages. "The opinion filed on June 6, 2014 ... is withdrawn. [This] superseding opinion will be filed concurrently with this order.... [B]ecause the district court made its ruling prior to the Supreme Court's decision in CIGNA Corp. v. Amara, the district court did not consider the availability of the 'monetary remedy against a trustee, sometimes called a 'surcharge,' which the Court held may be 'appropriate equitable relief' for purposes of Section 1132(a)(3). Accordingly, we vacate the district court's ruling that Gabriel is not entitled to any form of 'appropriate equitable relief' and remand for the district court to reconsider the availability of surcharge in this case, and, if available, whether Gabriel has adequately alleged a remediable wrong." [Gabriel v. Alaska Electrical Pension Fund, No. 12-35458 (9th Cir. Dec. 16, 2014)] (U.S. Court of Appeals for the Ninth Circuit)  

Lockheed Settles Lawsuit Over Retirement Plan Investments
"Lockheed Martin Corp. agreed to the provisional settlement of a $1.3 billion lawsuit by workers who claimed the Bethesda-based defense contractor mismanaged their retirement benefit plans, soaking them with fees while depriving participants of returns on company stock at least equal to those of investors on the open market. The accord, which requires court approval, was disclosed [Tuesday, December 16] by U.S. District Judge Michael Reagan ... The workers filed their class action in 2006." (The Daily Record)  

Treasury Finalizes Rules for New Retirement Savings Account: The myRA
"[T]he new regulations state that the myRA is going to be treated as a Roth IRA. This means all of the interest growth inside the myRA on the new electronic savings bond will come out tax free if certain holding period and trigger events are satisfied. By treating the myRA as a Roth IRA, the Treasury Department also helped exclude myRA account balances from required minimum distribution requirements after age 70-1/2. This could be a big benefit for some individuals looking for tax and investment class diversification." (Forbes)  

More Details on myRA Program; Comerica Identified as Custodian
"The Treasury Department's myRA terms and conditions document, titled 'Master Terms of myRA Custodial Account,' indicates that Comerica Bank is the custodian for myRAs. Earlier this year, the Treasury Department issued a request for proposal seeking a financial partner to administer these custodial accounts. Though not publicly announced, Comerica is identified as providing this service." (Ascensus)  

2014 Pension Plan Report Card, and Planning Ahead for 2015
"With lower rates and decent asset returns, most plan sponsors will be starting off the New Year worse off then they started 2014.... 2015 will not be as advantageous for offering lump sums; however, sponsors that are looking to systematically de-risk their plans that did not do a cashout window in 2014 may still want to look at offering one in 2015.... Plan sponsors will want to have a game plan for identifying what the 'right' contribution amount is for 2015 as it may be different from the minimum required contributions once all factors are taken into account." (P-Solve LLC)  

State of the Insured Retirement Industry: 2014 Review and 2015 Outlook
20 pages. "[As] Boomers increasingly work to calculate savings goals and contemplate their expected expenses and longevity, they are becoming less confident in their ability to achieve a successful retirement. But when those investing for retirement work with financial professionals and/or incorporate annuities into their retirement strategies, they report being better prepared and more confident.... Despite some macroeconomic challenges, the insured retirement industry is financially sound and in a strong position to expand its share of the retirement market as continually evolving demographics lead to increased consumer demand." (Insured Retirement Institute [IRI])  

Seven Questions to Ask Non-Profit Plan Sponsors
"[1] Does your organization's management and board feel confident with the plan's governance and their own responsibilities as plan fiduciaries? ... [2] Who is helping you with your fiduciary due diligence? ... [3] Do you have an investment policy statement and review process in place? ... [4] Do you have an education policy in place? ... [5] What challenges has your organization faced as a result of plan regulatory changes.... [6] If your plan uses multiple providers, or has legacy plan assets with multiple providers, how do you coordinate appropriate administration? ... [7] How are you measuring the success of your plan?" (The Principal Blog)  

Teacher Retirement Plans: Case Studies in Washington and Ohio Indicate Value of Defined Benefit Plans (PDF)
"Evidence from these two states suggests that teachers are unlikely to choose an alternative retirement plan design unless the state undertakes significant risk in the individual account portion of the plan. Furthermore, because research suggests that offering a choice could have adverse effects on teacher retention and quality, policymakers should proceed with caution before implementing a choice between a DB pension and a combined DB-DC plan." (National Institute on Retirement Security [NIRS])  

American Airlines Settlements to Be Eligible for IRA Rollover
"Both the U.S. House and Senate have passed a bill (H.R. 2591) amending the 2012 FAA Modernization and Reform Act to extend an expired deadline for bankrupt airline employees and former employees who received retirement plan settlements to roll over these settlement amounts to IRAs." (Ascensus)  

[Opinion]

Big Business Promoted Private Pensions to Crush Unions
"[T]he long, tangled history of U.S. private pensions is equally a story of how business sought to manage labor, conserve profits and block the expansion of a modern welfare state. Research by historians such as Jennifer Klein and Steven Sass helps explain why the U.S. is almost unique in its reliance on private, company-sponsored pensions instead of comprehensive, government-sponsored benefits." (Bloomberg View)  

[Opinion]

There Are No 'Economies of Scale' in 401(k) Plans -- Unless You Are Trying to Beat the Market
"Here is my problem with these 'magic' MEPs. At what level do we achieve 'scale?' And what will be the investment vehicle -- mutual funds? If mutual funds are used, how much will small plan sponsors save? Very few funds have significant minimum purchase requirements, so the savings would be limited. True savings would come from aggregating about $1 billion and hiring institutional investment managers directly -- just like the large pension and endowment plans do now." (Employee Fiduciary)  

[Opinion]

Multiemployer Pension Plan Reforms: Lessons from the Lame-Duck Session (PDF)
"While Solutions Not Bailouts drew loud opposition, no alternatives to address this problem, other than involving a bailout funded by taxpayers -- a political fantasy -- were presented as alternatives. There is a reason for this: if there were an easier way to save failing pensions, those concerned about the fate of these plans would have embraced it. Pretending something can be fixed less painfully later is not a plan, it's denial. After three years, several congressional hearings and many public events on Solutions Not Bailouts, no serious alternative plans emerged -- a clear indication there were no easy or painless ways to tackle this problem." (Earl Pomeroy, via American Benefits Council)  

[Guidance Overview]

IRS Releases Inflation-Adjusted Limits for 2015
"[Rev. Proc. 2014-61 includes] 2015 inflation-adjusted limits for certain benefit-related tax provisions. [This chart] shows the limits that apply to health flexible spending arrangements, qualified transportation fringe benefit plans, adoption assistance programs, qualified long-term care premiums and qualified retirement plans. The chart also identifies the Social Security taxable wage base, personal exemption and standard deduction amounts for 2015." (Towers Watson)  

Estimating Stock Compensation Volatility
"[This study] found that stock compensation volatility estimates are predicted just as well by using historical volatility as by blending historical with implied volatility. Further, longer-term windows of up to 15 years were shown to outperform the comparable-window forecasts typically in use." (PricewaterhouseCoopers)  

ISS Modifies Elements of Its CEO Pay-for-Performance Test
"The first modification alters ISS scoring methodology under its quantitative pay-for-performance tests that may result in slightly fewer U.S. companies showing a pay misalignment. The second modification revises ISS's peer group selection methodology for certain energy companies." (Meridian Compensation Partners, LLC)  

Tick, Tock: The Time for Year-End Financial and Tax Planning with Equity Comp Is Almost Over
"The clock is running out for year-end decisions that may have a big impact on your equity awards, including restricted stock units or stock options. [This article provides] an introduction to the major issues arising with equity compensation at the close of the year." (myStockOptions.com)  

TRW Signs Pension Buyout Agreement with MetLife
MetLife

Northeast Business Group On Health Honors Three NY/Connecticut Area Hospitals With Leapfrog Group Awards
Northeast Business Group on Health [NEBGH]

Philip Gould Joins Pentegra Retirement Services as Regional Director
Pentegra Retirement Services

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