|
Employee Benefits Jobs
|
|
Webcasts and Conferences
|
|
|
|
[Official Guidance]
Text of IRS 2014 Publication 590-A: Contributions to Individual Retirement Arrangements (IRAs) (PDF)
62 pages. Revised January 13, 2015, for use in preparing 2014 returns. "What's New for 2014: Publication 590 split ... Modified AGI limit for traditional IRA contributions increased.... Modified AGI limit for Roth IRA contributions increased.... What's New for 2015: Modified AGI limit for traditional IRA contributions increased.... Modified AGI limit for Roth IRA contributions increased.... Application of one-rollover-per-year limitation.... Airline Payments."
(Internal Revenue Service [IRS])
|
It's That Time Again: The DC Plan Restatement Season
"There are many opportunities for inadvertent glitches in the restatement cycle. The fact that document providers are processing so many plans in such a short interval means that errors are bound to happen. Furthermore, the restatements will be prepared using brand new documents just approved by the IRS. The unfamiliarity of those who process the documents with the new language creates additional opportunities for mistakes. Finally, it is common for plan sponsors to contemplate changes in plan terms in connection with the restatements to 'kill two birds with one stone,' and it is easy for these desired changes to be mis-documented or accidentally omitted in their entirety or for these modifications to raise separate issues that must be addressed."
(Ferenczy Benefits Law Center LLP)
|
What You Should Know About Retirement Plan Audits
"Some key questions to ask on a checklist include: For plan documents, are all required amendments present? Do you enroll participants in a timely fashion? Do those eligible for matching contributions receive them? Do you apply contributions correctly? Do you execute on all the rights that terminated employees have under the plan? Can you illustrate the effectiveness of your process through documentation? Are all the various aspects of the plan operating correctly -- enrollment, contributions, in-service withdrawals, hardship loans, and termination?"
(Vanguard)
|
Text of Sixth Circuit Opinion: PBGC Denial of Post-Termination Amendment Was Not Arbitrary and Capricious (PDF)
"Even assuming Kentucky Bancshares was obliged to amend its Plan to account for changes precipitated by the PPA ... nothing in the PPA or the Internal Revenue Code made it necessary for Kentucky Bancshares to amend the Plan in a way that caused a decrease in the value of benefits. Or, stated otherwise, even though the PPA-authorized changes made by the Plan amendment were permissible ... Kentucky Bancshares has failed to identify any persuasive authority or reason for finding that the amendment did not result in an impermissible post-termination decrease in the value of benefits ... PBGC reasonably concluded that Kentucky Bancshares' compliance with PPA Section 1107 did not obviate its obligation to also comply with ERISA's standard termination requirements. The two sets of requirements are not contradictory[.]" [Pension Benefit Guaranty Corp. v. Kentucky Bancshares, Inc., No. 14-5573
(6th Cir. Jan. 15, 2015)]
(U.S. Court of Appeals for the Sixth Circuit)
|
Retirement Plans: Legal Compliance Considerations for 2015 (PDF)
"The new year presents an excellent opportunity to consider your retirement plan's legal compliance (past, present, and future). [This article includes] a short list of issues and questions aimed at limiting your exposure and best achieving your goals in 2015."
(The ERISA Law Group)
|
Some DOL Investigations Shift Focus
"[A recent] investigation for [a] California employer ... focused on the standard litany of issues (e.g., late deferrals and reconciliation of trust data). However, the DOL also focused its inquiry on the specific investments in the plan and, specifically, whether the share classes of those investments were appropriate. This investigation also involved a reconciliation of the direct and indirect compensation as reported on the Schedule C, Form 5500 to the service provider invoices which were required to be produced to the DOL."
(Drinker Biddle)
|
Managing Defined Contribution Plan Investment Policy Statements
"Once an [investment policy statement (IPS)] is created and in place, it is the plan sponsor's responsibility to adhere to it. An ongoing monitoring process is key to a successful IPS. If something changes to make the IPS no longer relevant, it must be revised." [This article includes a checklist for fiduciaries of criteria to be considered when creating and monitoring an IPS.]
(Fred Reish, for J.P. Morgan Asset Management)
|
Little Plan Sponsor Reaction to No Presumption of Prudence
"Following a U.S. Supreme Court decision that fiduciaries of [ESOPs] are not entitled to any special presumption of prudence under [ERISA], 72.7% of defined contribution (DC) plan sponsors that offer company stock indicated they anticipate no changes to their offerings this year.... 9.1% said they will regularly review company stock in investment committee meetings, while another 9.1% said they will eliminate company stock as a plan option. The same percentage said they are waiting to make a decision pending the outcome of ongoing stock drop lawsuits."
(planadviser)
|
Providing Investment Advice: Who's a Fiduciary?
"Where there can be some doubt as to fiduciary status is the case of hired investment advisors. In the case of litigation or arbitration, a judge or panel would ask some form of the following three questions to determine status: What were the scope of services being offered? What was the client's level of sophistication in managing investments? How many investment options were suggested to the client? ... [It] would be better for all parties if these questions were asked before any disputes arise that might lead to litigation or arbitration. Better yet, the client and advisor should go over these questions and have a mutual understanding of fiduciary status before an engagement is solidified."
(fi360)
|
401(k) Index and Observations, December 2014
"In December, defined contribution plan participants were light traders, with only two days of above-normal transfer activity ... Overall, 0.022% of total assets traded in December, with a slight preference of days (55%) favoring equities over fixed income assets.... After incorporating December's contributions, trades, and market activity, the overall participant allocation to equities increased slightly from 66.0% in November to 66.4% in December. Future contributions to equities decreased marginally month-over-month from 66.3% to 66.1%."
(Aon Hewitt)
|
Is It Too Little, Too Late for Multiemployer Pension Reform?
"Will the union trustees opt to buck their national union to apply for benefit suspensions? Will trustees act to cut benefit promises to vulnerable retirees living on fixed incomes? Similarly, what are the legal obligations of multiemployer trustees under ERISA when faced with benefit suspensions or the uncertain prospect of PBGC insolvency? The new law seems to say that trustees are not subject to fiduciary liability to participants or retirees for suspending benefits, but that is not entirely clear. Difficult and controversial decisions will have to be made when presented with merger and partition alternatives as well. The new reforms stop the bleeding but don't change the fundamental problems facing multiemployer plans[.]"
(Fisher & Phillips LLP, via Inside Counsel)
|
|
|
New Jersey Says It Does Not Have to Make Pension Contributions
"An attorney for New Jersey Governor Chris Christie's administration argued in court on Thursday that the state cannot be forced to make its contributions into the public pension system. The state's 2011 pension reforms violated the New Jersey constitution when they made state pension contributions a contractual right, forcing future legislatures to pay for something they themselves did not approve, Assistant Attorney General Jean Reilly argued."
(Associated Press via Yahoo! News)
|
|
Benefits in General; Executive Compensation
|
Dallas Salisbury to Step Down as EBRI Chief
"When Mr. Salisbury, then just 29, joined EBRI [in 1978] after holding various positions at the PBGC and the departments of Labor and Justice, corporate defined benefit plans were growing instead of shrinking, 401(k) plans had yet to be launched, 'derisking' was not yet part of the pension lexicon, and COBRA referred to an animal, not an acronym for the 1986 federal health-care continuation law.... 'Washington is full of institutions that lobby government; Dallas created one that educates the nation,' said former PBGC Director Joshua Gotbaum."
(Pensions & Investments)
|
Recent Case Imposing Employer Liability Based on FICA Error May Extend to 409A Errors (PDF)
"For employers sponsoring nonqualified plans, the recent Henkel decision does offer some potentially helpful guidance regarding FICA withholding and the Code's special timing rule. Specifically, the court indicated in its opinion that if an employer fails to withhold FICA taxes on nonqualified plan benefits consistent with the special timing rule, withholding of the FICA taxes on a 'pay as you go' basis complies with federal law." [Davidson v. Henkel Corp., No. 12-cv-14103 (E.D. Mich. Jan. 6, 2015)]
(Groom Law Group)
|
|
Press Releases
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional useful links:
BenefitsLink.com, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
Phone (407) 644-4146
Fax (407) 644-2151
Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager
Copyright 2015
BenefitsLink.com, Inc. — but feel free to forward this
newsletter without further permission from us, if you do not
modify the newsletter in any way (including this lower
portion).
All materials contained in this newsletter are
protected by United States copyright law and may not be
reproduced, distributed, transmitted, displayed,
published or broadcast without the prior written
permission of BenefitsLink.com, Inc., or in the case of
third party materials, the owner of that content. You
may not alter or remove any trademark, copyright or
other notice from copies of the content.
Links to Web sites other than those owned by
BenefitsLink.com, Inc. are offered as a service to
readers. The editorial staff of BenefitsLink.com, Inc.
was not involved in their production and is not
responsible for their content.
We are proud of our
Privacy Policy.
Thanks for reading this newsletter!
|
