Retirement Plans Newsletter

September 18, 2017 logo logo
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Webcasts, Conferences

Voluntary Fiduciary Correction Program and Abandoned Plan Program Workshop
September 22, 2017 WEBCAST
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

Case Studies in Ethics: An Interactive Approach
September 26, 2017 in FL
ASPPA Benefits Council [ABC] of North Florida

Choosing a Retirement Solution Workshops
September 27, 2017 WEBCAST
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

403(b) Prototype Document
October 17, 2017 in IL
FIS Relius Education

Benefits Briefing 2017
November 2, 2017 in CA
Trucker Huss

►See 187 Upcoming Webcasts and Conferences

►See 1265 Recorded Webcasts


New Topics on the BenefitsLink Message Boards

New Comments and Topics

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[Official Guidance]

Text of PBGC Technical Update 17-1: Active Participant Reduction Reportable Events
"PBGC is providing an alternative method for determining whether reporting an attrition event to PBGC is required under Section 4043.23(a)(2) to avoid possible duplicative reporting.... To determine whether reporting is required for an attrition event for a plan year, a potential filer may disregard any cessations of active participant status reported to PBGC for single-cause events during the plan year or preceding plan year."
Pension Benefit Guaranty Corporation [PBGC]


Session Details Announced -- Register by Oct 2 to SAVE!

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

Collecting benefit payments is complex. Register for the Collection Procedures Institute to learn best practices, trends, legal and legislative updates and network with others to discuss the challenges that come with collecting benefit payments.

[Official Guidance]

Text of PBGC Notice of Intent to Request Extension of OMB Approval of Form 5500, with Modifications
"With regard to the Schedule MB instructions, PBGC is proposing to change the instructions to require new attachments in two situations ... With regard to the Schedule SB instructions, PBGC is proposing to change the instructions related to an attachment that is currently required of plans for which the IRS has granted permission to use a substitute mortality table.... If the [IRS] regulations are not effective on 1/1/2018, then the proposed changes to the Schedule SB will be deleted from the final Form 5500 instructions. PBGC is proposing to require plans to report additional information (consistent with the amended regulation) as part of the item 23 attachment. The addition of information will allow PBGC to reconstruct the substitute table for which the plan has sought IRS approval."
Pension Benefit Guaranty Corporation [PBGC]

District Court: Suspension of ESOP Diversification Elections Pending Interim Stock Valuation Was Arbitrary and Capricious
"[T]he Plan could have made an exception for an alternative valuation date or other contingency plan in unexpected times of financial stress, but it did not.... [T]he terms governing the timing of the valuation of Bankshares's stock for purposes of ascertaining the fair market value of the stock and the individual ESOP accounts are clear, mandatory, and permit no exception. This court ... cannot rewrite the requirements of the Plan to alleviate the adverse consequences to Bankshares as a result of its allocation of risk." [Bryant v. Community Bankshares Inc., No. 14-1074 (M.D. Ala. Sept. 12, 2017)]
U.S. District Court for the Middle District of Alabama

Assessing Multiemployer Plans' Capacity for Self-Stabilization (PDF)
12 pages. "Three main options are available to prevent the exhaustion of the [PBGC's] guarantee fund : [1] empower plans to take stronger actions to avoid or delay insolvency; [2] reduce the level of the PBGC's benefit guarantee, and/or [3] increase the revenue flowing into the fund, either through premium increases or by securing additional revenue sources. [This paper focuses on Option One.]"
The Pension Analytics Group

The DOL 401(k) Audit: How to Reduce the Odds and Prepare (Just in Case)
"Depending on the reason for the audit, the DOL can request various types of information. [What follows] is a list of some items the [DOL] could require. If the DOL comes for a visit, would you be able to access these items for the DOL auditor?"


15th National Forum on ERISA Litigation on November 1-2, 2017 in New York

Sponsored by American Conference Institute

The latest round of ERISA claims and class actions are more complex than ever and the stakes involved for all parties are exceptionally high. Attend this event to obtain the highest-level insights on the most pressing ERISA challenges. 10% Discount: use code D10-824-BLINKS.

Investment Committee Governance Benchmarking
"One way to grade job performance is to create a matrix of relevant attributes and compare actual deeds to expectations of what a prudent investment fiduciary would do in similar circumstances. Although overly simplistic, the [example provided in this article] illustrates the general notion of ranking decisions from great to bad or somewhere in between."
Susan Mangiero, via Fiduciary Leadership, LLC

The DOL Fiduciary Rule: Issues to Consider If You Advise IRAs
"Should a vendor be used to help obtain information about the client's existing account? ... How is the best interest analysis impacted by (a) a self-directed brokerage window in a workplace plan, (b) the plan sponsor subsidizing the current plan's administrative costs, (c) a workplace plan that does not allow the client to leave his or her assets in the plan, (d) a client that has the option to roll assets into an account at a new employer's plan and (e) whether lifetime income options are available under the existing account?"
K&L Gates LLP

Fiduciary Duties in an Age of Impact Investing (PDF)
"In recent years, managers of charitable organizations and pension plans have come under increasing pressure to adopt investment strategies that consider nonfinancial factors, such as environmental or corporate governance factors, or that further a moral, social, or political cause. Can pension plan and charity managers take into account non-financial factors when investing an organization's or plan's assets? Or do their fiduciary duties and other legal constraints require them to prioritize or focus solely on financial returns when evaluating investments? The answer may be yes to both questions, depending on the circumstances, but the lines are far from bright."
Steptoe & Johnson LLP, via Bloomberg Law Pension & Benefits Daily


Pensions Leaving Workers Behind by Focusing on Messaging, Politics
"[The Council for Institutional Investors (CII)] describes itself as a 'leading voice for effective corporate governance practices for U.S. companies and strong shareowner rights and protections.' But what started off as promoting good governance has transformed into politically motivated environment and social governance, often referred to as ESG. Fiduciary responsibility has taken a back seat.... CII members are staring at an unfunded liability of nearly $4 trillion ... So why do they insist on devoting so much of their time and resources on initiatives that will do nothing to help close that gap?"
Mark A. Bloomfield, American Council for Capital Formation, via Investor's Business Daily


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Public Pension Storm Warning
"Admittedly, public pension liabilities don't come out of nowhere the way hurricanes seem to -- we know exactly where they will strike. In many cases, we know approximately when they'll strike, too. Yet we still let our elected officials make impossible-to-fulfill promises on our behalf.... Worse, we let our government officials use predictions about future returns that are every bit as unrealistic as calling a 13-inch rain in Houston a 100-year event. And while some of us have called pension officials out, they just keep telling lies -- and probably will until we reach the breaking point."
Mauldin Economics

Benefits in General

Appeals Office to Resume In-Person Conferences
" 'Step one is going to be for field cases to turn the decision back over to taxpayers,' Andy Keyso, acting deputy chief at the [IRS] Office of Appeals, said ... 'Do you want an in-person conference? If so, you'll get it.' Step two is to include campus cases. Currently, Appeals is unable to offer in-person conferences for smaller cases that are worked out of the IRS campuses, Keyso said. Field cases include audits by a field revenue agent or office examiner, while campus cases include correspondence exam cases[.]"
Bloomberg BNA

on the BenefitsLink Message Boards

Encouraging Deferred Vested Participants Who Are Past Normal Retirement Date to Start Receiving Payments
"We have a non-trivial amount of deferred vested participants who are well past their NRD. The terms of the plan technically require commencement at NRD (at least as has been explained to me, but that's not really the issue at hand). Ignoring any ramifications of RMDs, have you seen any creative ways to encourage these participants to begin their pension and move into pay status? Letters reminding them of their pension, mailing unsolicited election kits, something else? This is attractive from a potential annuitization/termination perspective because deferred lives are more costly to place with an insurance carrier than an in-pay life. We have made multiple lump sum window offerings without much luck and we have good addresses for substantially all of them."
BenefitsLink Message Boards

Excess Safe Harbor Matching Contribution for One Participant: Where Does It Go?
"Small SH 401K, member of an LLC maxed out his deferrals/match and after year end, it was determined that his compensation was below 401(a)(17), which resulted in an excess SH match of under $1,300. Does this money go back to the plan sponsor or is it forfeited? If it is forfeit/suspense account, how can it be used in the future? Perhaps Profit Sharing? Plan expenses?"
BenefitsLink Message Boards

Timing of Corrective Amendment for 2016 and Going Forward for 2017
"We have a client that has allowed participants into the match portion of the plan earlier than the document allows. We are doing a corrective amendment for 2016, but can we also do a corrective amendment now for 2017? My concern is that I thought that a corrective amendment was only available after the plan year ended. Client has changed the entry conditions for match to tie to those of the deferral with an amendment effective August 1, 2017. But there is still the issue of the period from 1/1/17 to the date of amendment."
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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