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401(k) Retirement Plan Administrator
Nicholas Pension Consultants
in CA

Team Lead / 401(k) Pension Administrator
Nicholas Pension Consultants
in CA

Retirement Plan Compliance Analyst - Large/Mega/Non-profit
Great-West Financial
in KS

401(k) Relationship Manager
MVP Plan Administrators, Inc.
in NC

401(k) Administrator
Duncan Financial Group
in PA, Telecommute

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[Guidance Overview]

PBGC Expands Missing Participant Program to Cover Defined Contribution Plans (PDF)
"The new [voluntary] missing participant program for DC plans ... is applicable only to terminating plans ... Although voluntary, the program [for a terminating plan that elects to be a 'transferring plan' meaning the plan elects to transfer benefits to the PBGC for distribution to participant] is 'all or nothing'. If a plan elects to be a transferring plan, it may not choose to turn over the accounts of some participants and not others. This anti-cherry-picking rule does not apply to [a terminating plan that elects to be a 'notifying plan' (meaning the plan elects to merely provide information to the PBGC about the disposition of participants' benefits)]."
Boutwell Fay LLP


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[Guidance Overview]

New PBGC Options to Deal with Missing Participants in Terminated Plans
"There is no tax liability when the benefits are transferred to the PBGC. PBGC will pay interest on the amounts at the IRS mid-term rate, eliminating concern about how to invest the assets. PBGC will maintain a comprehensive searchable database as a resource for participants. PBGC will even make annuity payouts available to participants whose accounts exceed $5000, even if the plan did not provide for annuity options."
Cohen & Buckmann, P.C.

2017 Annual Report of the PBGC Participant and Plan Sponsor Advocate (PDF)
44 pages. "New to this report ... is a pension de-risking study commissioned by the Office of the Advocate at the request of plan sponsors. The study focuses on PBGC and Congressional actions that may slow pension de-risking activity, and highlights the drivers and causes of de-risking. This study found that reducing PBGC single-employer premium levels or stemming their rapid growth is likely to decrease risk transfer activity."
Pension Benefit Guaranty Corporation [PBGC]

Common Issues Discovered During Retirement Plan Audits
"The most common operational defect ... is that employers use incorrect compensation when calculating employee and employer contributions to the plan.... The second most common ... is improper application of the plan's eligibility provisions, particularly in regard to automatic enrollment and automatic escalation.... [Another is] the failure of the plan to properly conduct non-discrimination testing, due to the use of incorrect data[.]"
Trucker Huss

Defined Contribution Plan Compliance Calendar, 2018 (PDF)
"The dates on this calendar pertain to a plan with a calendar plan year."
Watkins Ross


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Four Safe Harbor Options for 401(k) Plans (PDF)
"Normally a 401(k) plan is subject to certain nondiscrimination tests ... Prior to the Pension Protection Act (PPA) of 2006, there were two options; but PPA added two more. This chart spells out all four options and most of the related rules."
Retirement Management Services, LLC

The Funded Status of Local Pensions Inches Closer to States (PDF)
14 pages. "[As] of 2015, local plans have an aggregate funded ratio of 69.9%, relative to 73.9% for state plans -- a difference that has been closing in recent years. Also, these local plans contributed 83% of their required contributions in 2015, relative to 76% for state plans ... [T]hese variances between state and local plans are possibly linked to differences in aggregate investment approaches and funding methods, respectively."
Center for State & Local Government Excellence

Avoid the $300,000 Retirement Mistake by Carefully Choosing Social Security Start Date
"Could you afford to give away $300,000 in retirement? ... [A]ccording to one financial expert, you could leave that much on the table by choosing the wrong strategy to claim your Social Security benefits."

Outlook 2018: PBGC Looking to Congress for Rescue
"The PBGC's program for insuring single-employer pension plans saw its deficit cut nearly in half during the 2017 fiscal year. At the same time, the agency's insurance program for unionized workers' pensions is in a tailspin and the agency is looking for help from Congress in 2018. The agency reported a $65.1 billion program deficit in its latest annual report and projects that the program will likely be insolvent by late 2025 or earlier."
Bloomberg BNA

'I Hope I Can Quit Working in a Few Years' -- A Preview of the U.S. Without Pensions
"The way major U.S. companies provide for retiring workers has been shifting for about three decades, with more dropping traditional pensions every year. The first full generation of workers to retire since this turn offers a sobering preview of a labor force more and more dependent on their own savings for retirement."
The Washington Post; subscription may be required


Fiduciary Litigation in 2018: A Pure Heart and an Empty Head Are No Defense
"Whenever the issues of fees is raised in ERISA cases, plan sponsors and the investment immediately respond that ERISA does not require that they select the investment options with the lowest fees. While this is true, it does not equate with an absolute immunity from recommending and selecting investment options that lack any inherent value for investors and pension plan participants."
The Prudent Investment Fiduciary Rules

Benefits in General

[Guidance Overview]

Benefit and Compensation Provisions in the Tax Cuts and Jobs Act
"The silver lining on the cloud of lost deductions is that the loss of the performance-based compensation exception may provide some additional flexibility in terms of plan design and administration.... [T]he ability to pay for qualified parking on a pre-tax basis will still benefit employees who can exclude these amounts from income. There is uncertainty whether the contributions made by employees to pay for pre-tax transportation benefits through salary deferrals would also be nondeductible to the employer."
Winston & Strawn LLP

[Guidance Overview]

ERISA Civil Penalties: Annual Adjustments for 2018
Chart lists the various statutory provisions, with a description of each ERISA violation and its penalty amounts for 2017 and 2018.
Butterfield Schechter LLP

Executive Compensation
and Nonqualified Plans

[Guidance Overview]

New Tax Law Brings Penalties for Top Paid Non-Profit Executives
"While there was concern among tax-exempts that the tax bill might reduce or even eliminate the presumption of reasonableness, that turned out not to be the case. But the final version of the legislation for the first time imposed a tax on certain excess compensation and excess parachute payments"
Mintz Levin

[Guidance Overview]

Tax Act Provides Planning Opportunities for Deferred Comp Plans and SERPs
"Once an employee becomes a 'covered employee' under Section 162(m), payments made to him or her will remain subject to the $1 million limit on deductibility forever, even on the individual's death! What planning strategies are left to us to reduce the impact of this limit? ... Deferring compensation until retirement or termination of employment is one[.] ... [A]fter a covered employee's retirement or other termination of employment, the company still will be able to pay and deduct up to $1 million in benefits each year."
Winston & Strawn LLP

Selected Discussions
on the BenefitsLink Message Boards

In-Service Withdrawals at 59-1/2 Now Allowed under 457(b) Plans?
Participants in government 457(b) plans must sever employment before they can make withdrawals from their accounts. Does the soon-to-be new law allow for in-service withdrawals upon attainment of age 59-1/2?
BenefitsLink Message Boards

Broker Sold My 401(k) Account's Individual Stocks During Plan Conversion without My Consent
I had a 401k from a former employer that held many individual stocks. The trustee failed to send me a blackout notice but the current broker called me saying the employer was moving plans and that I could transfer my account 'in kind.' I submitted all the paperwork through proper channels by December 28. I later called the current broker as a courtesy. He said he had sold all of my positions at the request of the trustee on the previous day. The trustee made those unauthorized sales without my approval. They claim a blackout notice was sent. I got a copy via email yesterday (on Dec. 29). Assuming I had received it, it makes no mention that individual positions will be sold into cash or that the new provider will not allow individual stocks. I've asked them to reverse the trades. They say they won't. What recourse do I have?
BenefitsLink Message Boards

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2018, 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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