Retirement Plans Newsletter

January 25, 2017 logo logo
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Employee Benefits Jobs

Retirement Plan Consultant
Pentegra Retirement Services
in TX

Benefits Analyst
Universal Health Services, Inc.
in PA

ESOP Relationship Manager II - West Coast
Principal Financial Group

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Webcasts and Conferences

New Year, New Changes to HR and Tax Compliance
January 31, 2017 WEBCAST

Health Insurance Markets During a Time Of Change
February 1, 2017 WEBCAST
Alliance for Health Reform

Profiting from Politics and Policies
February 9, 2017 WEBCAST

Healthcare Benefits Trends to Watch In 2017
February 13, 2017 WEBCAST
Healthcare Trends Institute

Certificate in Global Benefits Management
April 24, 2017 in DC
International Foundation of Employee Benefit Plans [IFEBP]

70th Annual National Conference
May 2, 2017 in IL
PSCA [Plan Sponsor Council of America]

GASB Updates: Statements 74 and 75
May 10, 2017 WEBCAST
Conference of Consulting Actuaries

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[Guidance Overview]

Puerto Rico Treasury Department Issues Updated Guidance on PR Code Qualification of Retirement Plans (PDF)
"The Puerto Rico Treasury Department recently issued Circular Letter of Tax Policy No. 16-08 (CLTP 16-08) to update and clarify the: [1] rules regarding the effective dates of favorable determination letters issued under Section 1081.01(a) of the Puerto Rico Internal Revenue Code ... and [2] due dates and procedures for requesting determination letters for retirement plans intended to be qualified under the PR Code."
Groom Law Group


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[Guidance Overview]

DOL Issues Additional Guidance on Fiduciary Rule (PDF)
"The latest round of FAQs ... speak[s] to a number of exceptions to the Regulation, such as [1] communications that are not considered recommendations that would be subject to the Regulation, [2] non-fiduciary investment education communications, [3] non-fiduciary general communications, [4] communications that qualify for the seller's carve-out, and [5] communications that qualify for the platform exception to the Regulation."
Morrison & Foerster

[Guidance Overview]

DOL Proposes Best Interest Contract Exemption for Insurance Intermediaries
"If granted, the exemption would permit certain insurance intermediaries, and the agents and companies they contract with, to receive compensation in connection with fixed annuity transactions that may otherwise give rise to prohibited transactions as a result of the provision of investment advice to retirement plan participants and beneficiaries, IRA owners and certain plan fiduciaries."
Practical Law Company

[Guidance Overview]

DOL's Fiduciary Reg: Recent Developments (PDF)
"[F]or the TPAs: Neither the original regulations nor the first set of FAQs addressed what we considered to be the most important question for you: is the recommendation of a financial institution to act as recordkeeper and fund holder a fiduciary recommendation under the new rules? ... [T]he second set of FAQs revealed that the answer to this question is a definitive 'no,' so long as you are not giving advice about the actual investments.... The second set of FAQs clarified that ... [if] there is no prohibited transaction, there is no need for an exemption, including BICE. This means that the business model of advisors using the offset model for compensation will likely be able to continue unchanged."
Ferenczy Benefits Law Center LLP

Super-IMOs Get 16 Months to Comply with DOL Class Exemption
"Qualified [Independent marketing organizations (IMOs)] only need to show that they are making a good faith effort and are 'presently taking steps to put in place the systems necessary' to meet best interest contract standards, and that the IMO 'fully intends to comply with all the applicable conditions for such relief after the expiration of the transition period,' DOL documents said. The period would start with the rule's effective date of April 10 and expire Aug. 15, 2018."


Online Learning Course: 401(k) Plan Structure

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

This course looks at the many aspects to consider when structuring a 401(k) plan. Topics include salary deferral limits and catch-up contributions, matching and profit-sharing contributions, nondiscrimination testing and safe harbors.

Answers to Common Questions About Roth 401(k) Deferrals
"Who are the best candidates for making Roth 401k deferrals? ... Who is eligible to make Roth 401k deferrals? ... What is the Roth 401k contribution limit? ... How are Roth 401k deferrals taxed at withdrawal? ... What is an in-plan Roth 401k rollover? ... re Roth deferrals subject to the same RMD rules as Roth IRAs?"
Employee Fiduciary

ESOP 'Light' -- A Creative Succession Strategy for the Small Business
"In the case of an ESOP 'light,' the goal of the pension plan is to favor only the owner. Other key employees are excluded from the plan by design. In other words, the plan is designed to favor only the owner and minimize benefits for all others. In doing so, the plan and its assets can be used for the primary purpose of 'buying out' the owner's interest in the company."
Fox Rothschild LLP

If Confirmed as Treasury Secretary, Mnuchin to Work on Retirement Reforms, Revisit Dodd-Frank Regs
"Steven Mnuchin, the nominee for Treasury secretary, said that if confirmed he will work with Congress on retirement reforms including ways to spur retirement savings by simplifying the tax code, and helping multiemployer plans. He also committed to revisiting the federal MyRA program."
Pensions & Investments

Benefits in General

ERISA Class Action Waivers and Mandatory Arbitration -- Will the Supreme Court Start a Trend?
"[W]hile defendants have solid arguments against class certification following recent Supreme Court decisions cutting back on certification, it may be appealing for plans to avoid class certification litigation altogether, and the associated high costs in attorney's fees, by mandating individual arbitration of ERISA claims. If the Supreme Court endorses arbitration in Murphy Oil, as it has in the recent past ... ERISA plan sponsors might reconsider mandating individual arbitration of ERISA claims."
Seyfarth Shaw LLP

Gorsuch May Bring Employer-Friendly Approach to ERISA Cases
"If nominated as the next U.S. Supreme Court Justice, Judge Neil Gorsuch may bring an employer-friendly approach to issues related to ERISA litigation and employee benefits.... A survey of decisions by Gorsuch shows that, although he has been involved in at least 20 ERISA decisions in the past 10 years, the issues in those cases have been fairly limited."
Bloomberg BNA


Time to Revisit Electronic Distribution Rules for SPDs
"Employers interested in using electronic distribution methods must solicit consent, track responses, store e-mail addresses and monitor delivery -- an administrative headache few want to take on.... In the almost 15 years since the regulations were last updated, Internet access has skyrocketed -- 84 percent of adults now use the Internet (up from 60 percent in 2002) and usage is almost universal for those of working age[.]"
Society for Human Resource Management [SHRM]

Executive Compensation and Nonqualified Plans

[Guidance Overview]

ISO and ESPP Reporting and Disclosure Requirements for Employers
"You must furnish an information statement on Form 3921 (ISO) or Form 3922 (ESPP), as applicable, to each employee (or former employee) by January 31, 2017; you must also file information returns with the [IRS] by February 28, 2017, if filing on paper, or March 31, 2017, if filing electronically.... A $50 penalty per return may apply for a filing that occurs on or before 30 days after the filing deadline, increasing to $100 if the filing occurs after 30 days but on or before August 1, 2017. Thereafter, a $260 penalty may be assessed for each delinquent filing, subject to a maximum penalty of $3,193,000 per year or $1,064,000 for small businesses."
Hanson Bridgett LLP

CEO Pay Ratio Disclosure Not Affected by Freeze on Federal Regs
"Last Friday's Reince Priebus memo instructing the heads of federal executive departments and agencies to freeze certain regulatory activity does not affect the CEO pay ratio disclosure set to take effect for the 2018 proxy season because independent regulatory agencies like the Securities and Exchange Commission are exempt from its coverage."
Willis Towers Watson

How Hard Is It to Achieve Target Incentive Payouts?
"5% of executives at companies that offered such programs achieved at least 'threshold' performance, meaning they qualified for at least a partial bonus. 'Target' performance was also achieved by a large majority -- 75% -- of executives at those companies. However, only 15% of them qualified for the maximum bonus stipulated in their incentive plan."

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