Retirement Plans Newsletter

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Senior Retirement Plan Administrator
Professional Capital Services
in PA

Associate Consultant / Retirement Plan Administrator
Spectrum Pension Consultants, Inc.
in CA, HI, WA, Telecommute

Senior 401(k) Plan Administrator
401(k) Firm
in CA

►See 143 Jobs

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Webcasts, Conferences

Annual Benefits Trends
September 21, 2017 in GA
Worldwide Employee Benefits Network [WEB] - Atlanta Chapter

New Parental Leave Laws in Washington D.C.
October 25, 2017 WEBCAST
Lorman Education Services

13th Annual Benefits Forum
November 29, 2017 in TX
Dallas-Fort Worth Business Group on Health

►See 183 Upcoming

►See 1231 Recorded


New Topics on the BenefitsLink Message Boards

New Comments and Topics

All Topics, Grouped by Forum

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[Guidance Overview]

2017 Q&As: PBGC Meeting with ABA Joint Committee on Employee Benefits, May 10, 2017 (PDF)
13 pages. Topics include: [1] Regulatory review/reform developments: PBGC impact; [2] PBGC early warning program; [3] Multiemployer program update (including PBGC audits of plans terminating by mass withdrawal, and two-pool withdrawal liability method request for information); [4] PBGC informal assistance regarding merger and partitions; [5] Reportable events: recent PBGC experience; [6] Standard terminations: recent PBGC experience; [7] PBGC website project: Q&A presenting informal views; [8] PBGC premiums in the context of de-risking, and de-risking trends.
Joint Committee on Employee Benefits [JCEB], American Bar Association


Register Early and Save -- October Certificate Series Program

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

The Certificate Series offers comprehensive educational opportunities in each area of total compensation. Take a single course in a specific area or take three courses to earn a Certificate of Achievement in the discipline of your choice.

[Guidance Overview]

IRS Has Revised Its Qualified Plans Correction Program to Address the Determination Letter Program Changes (PDF)
"This column discusses the major changes made to the Employee Plans Compliance Resolution System (EPCRS) by Revenue Procedure 2016-51 to address the determination letter program changes.... [1] Determination letter requirement for self correction eliminated ... [2] Requirement (or ability) to apply for a determination letter as part of EPCRS eliminated ... . [3] IRS VCP fees and schedules moved ... [4] IRS audit cap sanctions revamped to address the lack of a recent determination letter ... [5] Plan amendment and plan document failures clarified."
Groom Law Group, via Journal of Pension Benefits

[Guidance Overview]

Regulation of Robo-Advisers by the DOL (PDF)
20 pages. "Robo-advisers that provide advisory services to retirement plans governed by the fiduciary provisions of [ERISA], ERISA plan participants, and [IRAs] should also be aware of how the fiduciary duty and prohibited transaction provisions of ERISA and the prohibited transaction provisions of the [Internal Revenue Code] apply to them and their services. Additionally, robo-advisers should be aware that other financial firms will look to the technology of robo-advisers to aid in the firms' compliance with ERISA and the Code.... [R]obo-advisers should be as flexible as possible with regard to product development and their compliance strategy. Additionally, robo-advisers should recognize this period of uncertainty as an opportunity to get helpful guidance and exemptive relief from the Department."
Groom Law Group, via The Investment Lawyer

Puerto Rico Governor Signs Pension Reform Law
"Puerto Rico has passed pension reforms that include making payments to the depleted defined benefit system from general revenues, and creating a defined contribution plan for active workers and new hires.... The changes are subject to approval by Puerto Rico's Financial Oversight and Management Board [PROMESA] ... [which] has its own plan for pension reform that calls for progressively reducing pension benefits by a total of 10% for most participants and enrolling all active members and new hires in defined contribution accounts."
Pensions & Investments

District Court Allows Fiduciary Suit About Guaranteed Annuity Contract Cancellation to Proceed
"The complaint stems from the Contract between the Plan and CAC guaranteeing that the rate of interest credited to the CNA Fund would never drop below 4% per year. The Plan and CAC added the 'Minimum Interest Guarantee Rider' to the contract in 1990, which remained in place until Dec. 31, 2011, when it was discontinued pursuant to an agreement executed two days earlier between Northern Trust and CAC, which provided that 'at the request of' the Plan's trustee, the contract would be cancelled." [Dolins v. Continental Casualty Co., No. 16-8898 (N.D. Ill. Aug. 18, 2017)]
National Association of Plan Advisors [NAPA]


Reforms, Regulations & Retirement Realities

Sponsored by ASPPA

This October the nation's retirement industry elite will converge at ASPPA Annual, in our nation's capital, with insights from industry insiders, regulators, pundits and the nation's leading voices. Join us!

Bank of America Corp., Others Named in Antitrust Lawsuit Filed by Public Pension Systems
"[T]he plaintiffs allege that the defendants ... 'engaged in a combination and conspiracy among themselves to prevent the emergence of efficient all-to-all electronic trading platforms in the stock loan market' and to 'to boycott emerging platforms and force customers to boycott them.' They allege this conduct violated antitrust laws and damaged them and members of the class." [Iowa Public Emp. Ret. System v. Bank of America, No. 17-6221 (S.D.N.Y.; complaint filed Aug. 16, 2017)]

DOL: Fiduciary Rule Lawsuit Angle 'Will Likely Be Mooted'
"In a court brief filed in District of Minnesota federal court, government attorneys said the lawsuit angle 'will likely be mooted in the near future.' ... [T]he DOL is proposing an 18-month delay that is expected to be published in the Federal Register soon. During that time, the department will study and revise some portions of the rule.... Several lawsuits were filed challenging the government's right to create a private right of action[.]" [Thrivent Financial for Lutherans v. Acosta, No. 0:16-3289 (D. Minn.; letter to the court, filed Aug. 23, 2017)]

End of the Pension Funding Holiday Road
"Since rates were much higher in the 1990s, the stabilized rate delivered an immediate, significant boost to the funding rate. Funding liabilities for a typical DB plan were initially reduced 15 to 20 percent in 2012. But the potency of this relief is gradually wearing off[.]"
The Principal Blog

Text of IRS Publication 4483: 403(b) Tax-Sheltered Annuities for Sponsors (PDF)
Revised Aug. 2017. "As a 403(b) plan sponsor, it's important to know the tax rules that apply to your 403(b) plan and to pay attention to the operation of your plan so you can: [1] maximize your employees' retirement benefits, [2] comply with the law, and [3] avoid additional taxes and penalties."
Internal Revenue Service [IRS]

403(b) Plans Improving Plan Design
"Twenty-one percent of 403(b) plans now automatically enroll their participants, up from 19% in 2016 and 16.2% in 2014. Among the 21% of plans that automatically enroll participants, 52% pair that with automatic escalation, up from 43% in 2015."

Mixed Messages About Retirement Tax Provisions Causing Alarm
"The House Ways and Means Committee is telling stakeholders that revenue associated with retirement savings won't be used to fund tax reform ... But individual members say they are working with leadership to develop ideas around a concept known as 'Rothification' that would tax savings upfront, rather than when they're withdrawn in retirement ... Ideas under consideration include taxing all savings upfront or allowing a certain amount to be contributed tax-free with anything over the limit being subject to a levy."
Bloomberg BNA


ERIC Comments to PBGC on Regulatory Planning
"We encourage the PBGC to carefully weigh the financial impact and other costs of new and existing regulations against the benefits (if any) associated with them.... [U]nhelpful changes to existing programs, such as the Early Warning Program, only feed into growing skepticism that it is still prudent for employers to continue to sponsor defined benefit plans."
The ERISA Industry Committee [ERIC]

Benefits in General

[Guidance Overview]

Proposed Statement of Auditing Standards: Redesigning the Audit Reporting Model for ERISA Plan Financial Statements
"In addition to changing the form and content of limited scope audit reports to better explain the auditors' responsibilities, the proposed SAS requires the auditor to report findings from procedures performed on specific plan provisions that affect the financial statements."
Belfint Lyons & Shuman, CPAs

SHRM Advocates Seek More Flexibility for Benefit Plan Disclosures
"SHRM agrees with the [ERISA Advisory Council's] proposal to eliminate the summary annual report (SAR) ... SHRM also supports the council's proposal for consolidating various health and welfare notices into a single standardized notice.... The advisory council has created a draft communication referred to as a quick reference guide (QRG) that would be delivered annually and provide introductory information on provisions of the summary plan description (SPD) with links to more detailed information.... Among retirement plan disclosure reforms, the council proposed to replace the current ERISA Section 404(a)(5) fee disclosure notices.... SHRM is concerned that eliminating the current fee disclosure notice and replacing it with another notice [in the form of an investment fund sheet] is not ideal"
Society for Human Resource Management [SHRM]

Executive Compensation
and Nonqualified Plans

Accounting for Stock Compensation Under FASB ASC Topic 718 (PDF)
13 pages. "FASB ASC Topic 718 is in substantial convergence with the International Accounting Standard Board's final standard on Share-based Payment, except for transactions with nonemployees and nonpublic companies, and minor technical differences in regard to employee stock purchase plans, modifications, liabilities, and income tax effects. Topic 718 creates a more 'level playing field' for equity compensation design that has resulted in the increased prevalence of full-value and performance-vesting awards, and a corresponding decline in plain-vanilla, tax qualified, and reload stock options, and employee stock purchase plans."
FW Cook

on the BenefitsLink Message Boards

Employee Missed Deferral Opportunity for One Pay Period
"A glitch caused one participant's deferral to be missed for one payroll cycle. The issue was caught within 30 days. Under the new rules, client issues notice to employee with no corrective contribution. The plan does not offer match so no missed match. The question is in regards to missed earnings -- do we have to determine or track them, if the employee decides to make a catch-up contribution for the missed deferral?"
BenefitsLink Message Boards

Can Company Subtract Employer Contributions from Participant's W-2 Comp?
"If a participant works as a physician in a medical office and is not a partner, can the firm require that the amount of the participant's safe harbor matching contribution and profit sharing contribution be taken from his W-2 compensation? This requirement is found in the employment contract, not in the plan document."
BenefitsLink Message Boards

ADP Testing for Controlled Group
"Company X and Y form a controlled group. X has a 401(k) plan, Y does not. To pass coverage for the Company X 401(k) plan, the Ratio Percentage Test passes by disaggregating otherwise excludable employees of both companies while treating employees of Company Y as not benefitting. Question: When performing ADP test for the Company X 401(k) plan, am I required to carve out the otherwise excludible employees, or can I run an aggregated test including all eligible employees of Company X?"
BenefitsLink Message Boards

Press Releases

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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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