Retirement Plans Newsletter

January 6, 2017 logo logo
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Employee Benefits Jobs

Webcasts and Conferences

2017 Securities and Executive Compensation Updates
January 18, 2017 in PA
Morgan Lewis & Bockius LLP

Tax Section 2017 Midyear Meeting
January 19, 2017 in FL
American Bar Association [ABA]

Shifting Paradigm of Retirement: What it Means for Employers, Workers, and Retirees
February 3, 2017 in DC
U.S. Chamber of Commerce

ACA Employer Reporting Update: Employee Statements and IRS Reports Still Must Be Filed
February 14, 2017 WEBCAST

Did You Know -- Unique State Employee Benefit and Employment Issues?
February 16, 2017 WEBCAST
ABA Joint Committee on Employee Benefits [JCEB]

Fiduciary Rules, Roles, and Responsibilities 101 for the Administrator
March 21, 2017 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

Legislative Update: Health & Welfare Benefit Plans
March 30, 2017 WEBCAST

37th Annual Conference: Employers as the Avengers of Health Benefits
May 10, 2017 in IL
Midwest Business Group on Health

Legislative Update: Retirement Plans
May 11, 2017 WEBCAST

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[Official Guidance]

Text of 2017 PBGC Premium Payment Instructions (PDF)
61 pages. "This document provides information for plans paying premiums for plan years beginning in 2017, including instructions for each data element that must be reported. If you are filing for a previous year, you must follow the instructions for that year ... If you are amending a filing for a plan year that did not begin in 2017, the rules in this document do not apply. You must follow the instructions and regulations applicable for that plan year."
Pension Benefit Guaranty Corporation [PBGC]


50th Anniversary Sale

Sponsored by DATAIR Employee Benefit Systems, Inc.

DATAIR is having a 50th Anniversary Sale and ALL software is offered at 50% off the license fee. Contact us today for more information: 888-328-2474 or

[Official Guidance]

Text of IRS Publication 4810: Specifications for Electronic Filing of Form 8955-SSA, Annual Registration Statement Identifying Separated Participants with Deferred Vested Benefits (PDF)
52 pages, revised Jan. 2017. "The purpose of this publication is to provide the specifications for electronically filing Form 8955-SSA, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits, with the [IRS]. This publication must be used to prepare current and prior year Form 8955-SSAs. Generally, the boxes on the paper forms do correspond with the fields used for the electronic record; however, if the form and field instructions do not match, the guidance in this publication supersedes the form instructions."
Internal Revenue Service [IRS]

[Guidance Overview]

DOL Reinstates Modified Version of 1994 Guidance on Exercise of Shareholder Rights, Including Proxy Voting
"While the 2008 guidance was intended to update and clarify the 1994 guidance, the changes have -- in the DOL's view -- 'been misunderstood' ... According to the DOL, some have read the 2008 guidance to prohibit ERISA plans from exercising shareholder rights, including voting of proxies, unless the plan performed a cost-benefit analysis and concluded that the particular action was more likely than not to increase the value of the plan's investment.... By reinstating a modified version of the 1994 guidance, the DOL seeks to correct misperceptions about its position and encourage the exercise of shareholder rights."
Thomson Reuters / EBIA

[Guidance Overview]

SEC Staff Provides Guidance on Disclosure of Sales Load Variations and Filing of New Share Classes in Light of the DOL Fiduciary Rule
"The Guidance addresses certain concerns raised by mutual funds in light of the broker-dealer industry's response to the [DOL's] new fiduciary rule. Specifically, mutual funds have indicated to the SEC that broker-dealers have been seeking to standardize the sales commissions that they receive from mutual fund families.... [IM Guidance Update No. 2016-06] addresses (i) how to properly disclose sales load variations, and (ii) how to efficiently navigate the SEC registration statement filing and staff review process for both sales load variations and new share classes."
Sutherland Asbill & Brennan LLP

Should DC Plan Sponsors Add Private Equity to Target Date Funds? (PDF)
21 pages. "In this paper, [the authors] studied how the inclusion of Private Equity in custom Target-date Funds (TDFs) affects the return profile of TDFs -- more specifically, [the] approach focused on including Private Equity in TDFs while keeping their risk profile unchanged. From a practical point of view, this analysis allowed [the authors] to research whether adding Private Equity to TDFs has the potential to enhance investors' retirement returns without assuming additional risk.... [R]esults suggest that a pension plan member could potentially increase the total amount saved and distributable in year 45 by approximately 8.7%."


Techniques to Enhance Your 401(k) Plans

Sponsored by Lorman and BenefitsLink

Jan. 31 webinar. Fiduciary process and techniques of automatic enrollment, auto escalation, re-enrollment, Qualified Default Investment Alternatives, hiring and monitoring of service providers, benchmarking, investment due diligence, regulatory issues.

Rise in Interest Rates Lowers the Cost of Retirement Income
"Today, investors are enjoying retirement income costs lower by as much as 14% versus a few months ago ... which helps investors estimate how much annual retirement income their current savings can generate starting at age 65."

Designers of Retirement Calculators Strive for Better Fidelity to Real Life
"To improve the accuracy of their forecasts, developers of calculators are using more complex formulas for model's assumption on the rate of return on investment assets.... To address volatility, some calculators perform a Monte Carlo simulation of a range of outcomes randomly chosen.... Some models base their rate of return on historic market data on the performance of asset classes over the past century. If the future is not like the past, then the accuracy of this approach will suffer."
Mind Over Market

S&P 1500 Pension Funded Status Recovers to 2015 Levels, Reaching 2016 High in December
"Throughout most of 2016, rates and funded status remained lower than in 2015. By the end of 2016, funded status improved to the same level, 82%, as at the end of 2015. Deficits increased slightly from $404 billion at 2015 year-end to $408 billion at 2016 year end.... Typical discount rates for pension plans ... decreased by 20 basis points during 2016 to 4.04 percent."

Corporate Funded Status Sees Little Change in 2016
"The estimated aggregate value of pension fund assets of S&P 1500 companies totaled $1.81 trillion as of Dec. 31, up 0.56% year-over-year, while estimated aggregate liabilities totaled $2.21 trillion, up 0.45% from Dec. 31, 2015. The aggregate deficit rose by $4 billion to $408 billion as of Dec. 31. Interest rates declined 20 basis points over the year to 4.04%."
Pensions & Investments

Iron Worker Retirees Face Stacked Deck in Vote to Cut Pensions
"Nearly 2,000 Iron Workers in the Cleveland area will be voting by Jan. 20 to accept or reject cuts to their pensions, and the vote could pit active employees against retirees. It will be the first time a multiemployer pension fund will face such a vote, and the outcome could open the floodgates for dozens of other plans to take similar measures."
Bloomberg BNA

Fiduciary Must Surrender Luxury Cars Over Plan Mismanagement
"The owner of a DirecTV installation company accused of mismanaging an ESOP must turn over three vehicles, including two Lexuses, to cover a multimillion-dollar judgment in favor of participants and the Labor Department.... Herbert C. Bruister must also cooperate with participants and the DOL in the sale of his multimillion-dollar life insurance policies, which he offered as security pending an appeal[.]" [Perez v. Bruister, No. 13-1001 (S.D. Miss. Jan. 4, 2017)]
Bloomberg BNA


Pension Obligation Bonds: Portents of Bankruptcy
"It is no coincidence that the worst funded public pension systems (NJ, IL, CT, PR) all tried the [pension obligation bond (POB)] gambit not because it made any fiscal sense but because they chose not to look at immediately unpleasant alternatives (i.e. cutting benefits or affording honest contribution amounts). The POB money suddenly appeared in trust assets making the plans seem better funded which would theoretically reduce future contributions. In practice, in New Jersey at least, future contributions were reduced anyway as politicians simply chose to pick their contribution numbers with expediency as the primary determinate."

Press Releases

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David Rhett Baker, J.D., Editor and Publisher
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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2017, Inc. 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, Inc., or in the case of third party materials, the owner of those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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