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What Does The New Tax Law Mean for Retirement Plans?
"Anytime that tax rates are lowered, the value of the tax deduction for plan contributions goes down.... Under the new rules, owners of unincorporated entities are given a deduction equal to 20% of their 'qualified business income,' which is (generally) their net income from the business."
Ferenczy Benefits Law Center


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Optimizing Retirement Income by Integrating Retirement Plans, IRAs and Home Equity (PDF)
146 pages. "The authors recommend a portfolio approach for retirement income strategies that integrates Social Security claiming decisions, investing and deploying retirement savings, and utilizing home equity if necessary....The authors also identified one straightforward strategy that can be reasonably implemented in virtually any IRA or 401(k) plan without purchasing an annuity."
Society of Actuaries

New Evidence on the Demand for Advice Within Retirement Plans
"Demand for advice on asset allocations and income planning increased four-fold among study participants after online advice tools were introduced.... Demand tends to be higher among plan contributors than non-contributors and is significantly higher among contributors with web access."
TIAA Institute

Push Grows to Use Pension Funds to Address Climate Change
"New York Gov. Andrew Cuomo last week proposed a 'roadmap' for divesting the $200 billion New York state pension fund from fossil fuel investments, joining a move to use shareholder clout to reduce greenhouse gas-emissions believed to cause climate change.... CalPERS was a key organizer of a coalition of 225 large investors with $26 trillion in assets launched this month to use 'engagement' or persuasion, rather than divestment, to urge corporations to reduce greenhouse-gas emissions."

Small Business Owners Would Support New York Non-Workplace Savings Plan
"Almost three-fourths (74%) of [New York] business owners support legislation that would establish an easy to use, no hassle, low cost, privately managed New York State retirement savings option.... Almost three-fourths (73%) say if a state retirement plan existed, they would be likely to offer employees access to this retirement savings option."


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Retirement New Year's Resolutions (PDF)
"Set a date.... Do the math.... Start saving as early as you can.... Save as much as you realistically can.... Increase your 401(k) savings rate with each pay raise.... Play catch up.... Review your portfolio regularly.... Plan with your partner."


With Truth Still Elusive After the DOL Rule Begins to Take Effect, Don Trone Attacks the Issue Head on with a Modern-Day Lie Detector Test
"Seizing on what he sees as a monumental failure of the DOL fiduciary rule to fulfill its framers' mission, the early godfather of the fiduciary movement is pioneering a 2018 version of the lie detector test as a means of documenting virtuous intentions in the financial advisory field."

Benefits in General

The Impact of the 2017 Tax Reforms on Employment-Based Benefits and Executive Compensation (PDF)
"[A] new 'Qualified Equity Grant' ... to allow employees of nonpublicly traded companies to elect to defer taxation of stock options and restricted stock units (RSUs) for up to five years after the exercise of such stock options or the vesting of RSUs.... Repeal of 'recharacterization' of Roth IRA conversions ... Extended rollover periods for deemed distributions of retirement plan loans ... Tax relief for retirement plan distributions to relieve 2016 major disasters ... New credit for paid family and medical leave."

Executive Compensation
and Nonqualified Plans

[Guidance Overview]

Handling 'Excess' Employee Remuneration for Tax-Exempt Organizations
"Boards of tax-exempt organizations making payments to covered employees that are subject to the excise tax will need to consider ... [1] how the total cost to the entity bears upon the reasonableness of the compensation, and the benefit to the section 501(c)(3) tax exempt entity.... [2] the information that needs to be provided to potential donors to the organization.... [3] it may be possible to accelerate the vesting of the amounts due under the agreement, so that they are treated as income before the start of the organization's next taxable year."
The Wagner Law Group

CEO Compensation Slows and Shifts
"The median increase in target pay for S&P 1500 CEOs was 4.4% in 2016, down from 5.9% in 2015.... The median increase [in earned pay] was 2.2%, significantly down from 10.4% in 2015.... CEO salaries for the S&P 1500 increased a mere 1% in 2016, and over half of the S&P 500 CEOs didn't receive a 2016 salary adjustment."
Willis Towers Watson

Life Insurance: The Bonus Plan for the Executive Who Has Everything
"Under the executive bonus plan, the employer pays a bonus to the employee so the employee can purchase (and own) a fixed indexed universal life (FIUL) insurance policy. The employee then uses the bonus to pay the entire policy premium directly to the insurance company. Because the employee is the owner of the policy, the employee can access any available cash value accumulation through policy loans and withdrawals."

Selected Discussions
on the BenefitsLink Message Boards

Timing of Tuition Bills for Purposes of Hardship Withdrawal Eligibility
TPA and client agree that withdrawals for tuition under hardship provisions must be for upcoming, unpaid tuition. Client is worried that if a student begins a semester, let's say, September 1 and starts attending classes, but the tuition bill isn't issued, mailed and due until, say, October 1, then the tuition is "old" business and may not qualify, or at least might need to be somehow pro-rated such that the September expenses are not included. TPA takes the position that the timing of the billing does not matter. What say you?
BenefitsLink Message Boards

Application for VCR Due to RMD Failure; Attribution of Stock Owned by Spouse of the Participant?
Schedule 8 (Failure to Pay Required Minimum Distributions Timely) of the Form 14568-H Model VCP Compliance Statement asks whether "At least one affected participant is either an owner-employee (see IRC Section 401(c)(3)) or, if the plan sponsor is a corporation, a 10 percent owner of such corporation." The individual plan participant involved in an RMD failure is married to a 10 percent owner of the plan sponsor (a corporation) but is not himself a 10% owner. Do the attribution rules apply?
BenefitsLink Message Boards

Union Plan in a Right-to-Work State
Client has 2 plans -- one excludes union employees; other covers only union employees. They are in a right-to-work state. Many employees have chosen not to join the union. Do employees covered by the CBA, whether or not they choose to join the union, belong in the union plan only (such that they're excluded from the non-union plan)?
BenefitsLink Message Boards

Transition Relief Applicable? Jan. 1 Implementation Date Desired
The partners of Partnership A have created a new Partnership N -- with 90%+ the same partners -- to buy a business via asset sale. Partnership A already has a plan for its business. The purchased company had a plan. In an effort to make the changeover as seamless as possible to the employees, the partners of Partnership N want to install an exact copy of that company's plan ASAP while they figure out how to proceed in the future now that they have doubled in size. Does this meet the transition relief standards?
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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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