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Employee Benefits Jobs
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Webcasts and Conferences
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[Guidance Overview]
IRS Plans to Severely Limit Determination Letter Program (PDF)
"Changes in the program for individual [determination letters (DLs)] are expected to be announced this summer with some opportunity for public comment.... [T]he IRS is likely to allow individual DLs for newly established plans and terminating plans, and for compliance with new laws ... [T]here may be some mechanism for plans with unusual designs -- or impacted by major business events -- to be reviewed. The IRS expects to continue its pre-approved plan programs and expand them to include plans with cash balance and ESOP features.... [A] greatly pared-down DL program is likely to increase the risks employers face if their plans are found to be non-compliant.... Congruent changes may also be coming to the IRS private letter ruling process, the 'EPCRS' correction program, and audit procedures."
(Groom Law Group)
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[Guidance Overview]
Notes from Meeting of Actuaries Intersector Group with IRS/Treasury, April 16, 2015 (PDF)
9 pages. Topics include: [1] Mortality tables -- timing and process for 2016 tables, later years; [2] Hybrid plan transition rules -- timing of final regulation; [3] Permanent nondiscrimination testing relief for closed plans; [4] Pension equity plan (PEP) guidance and determination letter status; [5] Variable annuity plans; [6] Qualified Lifetime Annuity Contracts (QLACs) in defined benefit plans; [7] Multiemployer Pension Reform Act (MPRA) changes to 'zone status' rule; [8] Benefit Suspensions under MPR; and [9] Determination letter program.
(American Academy of Actuaries)
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[Guidance Overview]
IRS Clarifies Application of Section 415 to Governmental DROP Features (PDF)
"[IRS Memorandum TEGE-07-1114-002 9, dated December 8, 2014,] provides guidance to IRS employees when reviewing governmental defined benefit plans with deferred retirement option plan (DROP) features. The memorandum concludes that when a governmental plan credits the defined benefit amounts to a DROP, the defined benefit amounts are not subject to the defined contribution annual additions limit under Internal Revenue Code section 415. The memorandum further provides that additional contributions to the DROP are not considered annual additions if certain requirements are satisfied."
(Prudential)
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[Guidance Overview]
SEC Proposes Substantial New Reporting Requirements for Investment Advisers on Form ADV
"[The proposed rules] would ... expand the information collected on Form ADV, provide for the umbrella registration of certain affiliated investment advisers, make certain clarifying and technical amendments to Form ADV and amend the books and records requirements related to performance claims. [These] proposed amendments ... are not as comprehensive as the amendments adopted in 2011, but, if adopted, would significantly increase the amount of information reported on Form ADV by certain investment advisers."
(DLA Piper)
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[Guidance Overview]
IRS Updates EPCRS Correction Methods and Procedures
"[T]he updates encourage employers to add automatic contribution features to their plans ... Plans with automatic contribution features can use a new safe harbor to correct certain deferral failures, thereby reducing corrective contributions required of employers. The updates also encourage early correction of deferral failures by making available two safe harbors which feature reduced corrective contributions by employers.... [The updates also address] topics such as plan overpayments, excess annual additions, filing fees and correction procedures."
(McDermott Will & Emery)
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[Guidance Overview]
DOL Reproposed Rules Governing the Definition of 'Fiduciary', Part 4: The Impact on 401(k) Plan Consultants to Mid-Sized and Small Plans
"When compared to their large-plan counterparts, small and mid-sized plans that are subject to ERISA are at a disadvantage: the ERISA fiduciary standards and prohibited transaction rules apply with equal force to all such plans, but large plans are better able to afford the costs and other burdens of compliance. This divide ... is exacerbated by the proposed regulations' seller's carve-out, which is unavailable to the [small- and mid-sized plans]. In practice, the large-plan market is far ahead of the proposed regulations, since consultants in that market are, in the vast majority of cases, already operating as fiduciaries.... [T]he proposed regulations will put added pressure on mid-sized plan consultants to follow suit -- or choose instead to operate under the platform provider and educational carve-outs."
(Mintz Levin)
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2013 PBGC Data Book on Pensions (PDF)
74 pages. The data tables cover information recently reported by pension plans and the PBGC and compares them to values for prior years. Generally the updates cover pension plans data for the year beginning in 2013 with some later data as well. The tables include the numbers of people and plans that PBGC protects, the number of people receiving or eligible to receive benefits from PBGC and the benefits paid to them, claims against PBGC, the funded status of PBGC-protected plans, breakdowns of populations that PBGC protects by industry and state, and other vital statistics. Also available in Excel format.
(Pension Benefit Guaranty Corporation [PBGC])
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As DOL Stonewalls, House Committee Demands Answers on Fiduciary Rulemaking
"It defies explanation that DOL would assert publicly that coordination with the SEC took place and yet refuse to release documents substantiating its assertion. The members are requesting relevant documents and communications by June 16, 2015, along with a log identifying potentially responsive documents."
(Committee on Education and the Workforce, U.S. House of Representatives)
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ERISA Advisory Council Considers Model Lump Sum Window Disclosures
"A contingent of witnesses testified at the hearing that model disclosures should be designed to 'nudge' participants toward a decision to reject lump sum offers.... [It] was argued that providing participants with better information may not be enough to ensure that participants make good decisions and that 'choice architecture' should be used to encourage participants to make annuitization decisions that are in their best interest. Other witnesses argued for a more balanced approach, whereby necessary information is presented concisely, simply, and without a thumb on the scale toward a particular decision."
(National Law Review)
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Pension Fund Coalition Campaigns for SIFI Exclusion
"A coalition of pension fund representative associations across the U.S. and Europe has urged regulators to follow through with a proposed exclusion of pension funds from designation as systemically important. The joint letter responds to the Financial Stability Board and the International Organization of Securities Commissions' consultation document regarding plans to designate non-bank non-insurers as global systemically important financial institutions [SIFI]. Members of the coalition associations provide retirement benefits for more than 100 million individuals, and represent trillions of dollars in assets."
(Pensions & Investments)
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GAO Report: Most Households Approaching Retirement Have Low Savings
"About half of households age 55 and older have no retirement savings (such as in a 401(k) plan or an IRA).... [A]mong households age 55 and older, about 29 percent have neither retirement savings nor a DB plan ... Among those with some retirement savings, the median amount of those savings is about $104,000 for households age 55-64 and $148,000 for households age 65-74, equivalent to an inflation-protected annuity of $310 and $649 per month, respectively. Social Security provides most of the income for about half of households age 65 and older." [Published: May 12, 2015. Publicly Released: June 2, 2015]
(U.S. Government Accountability Office [GAO])
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[Opinion]
401(k) Participants Should Leave Investing to the Pros, Focus on Saving
"When people are faced with complicated questions, they tend to delay a response -- while doing nothing in the meantime.... [T]he best approach for participants is to break the process down into simpler decisions that can be addressed independently.... [Savers should] do just two things to keep their retirement savings on track -- establish a retirement savings goal and monitor progress towards that goal at least annually. Focus on saving and not investing. Unless you're an investing expert, leave the investment of your retirement account to professionals."
(Employee Fiduciary)
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Benefits in General; Executive Compensation
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DOL Audit Quality Study and Recommendations for Improvement
"[T]he underlying problem is that many plan sponsors see no value in the audit and only see it as a compliance hurdle that needs to be overcome.... [T]here are pressures on accounting firms to reduce fees as plan sponsors may only hire accounting firms based on the lowest price.... It appears that there may be some changes coming very soon as the AICPA begins implementing [its] 6-point plan. Some of the eleven recommendations made by the DOL in its report may have more trouble being implemented, such as the recommended changes to ERISA needing congressional agreement. However, the increased focus on audits performed by firms in the lower strata is sure to be implemented more quickly."
(Belfint Lyons & Shuman, CPAs)
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Press Releases
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Additional useful links:
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David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager
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