Retirement Plans Newsletter

February 8, 2018

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Webcasts, Conferences

Getting It Right - Know Your Fiduciary Responsibilities: Retirement and Health Plan Sponsors – Day 1
March 14, 2018 WEBCAST
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

Getting It Right - Know Your Fiduciary Responsibilities: Retirement and Health Plan Sponsors – Day 2
March 15, 2018 WEBCAST
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

Getting It Right - Know Your Fiduciary Responsibilities: Retirement and Health Plan Sponsors – Day 3
March 22, 2018 WEBCAST
Employee Benefits Security Administration [EBSA], U.S. Department of Labor

Phased Retirement Programs: Exploring the Benefits and Issues
April 20, 2018 WEBCAST
Lorman Education Services

Third Quarter 2018 Washington Update
August 9, 2018 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

Fourth Quarter 2018 Washington Update
November 8, 2018 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

►See 149 Upcoming Webcasts and Conferences

►See 1374 Recorded Webcasts


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[Official Guidance]

Text of PBGC Submission to OMB and Public Comment Request: Termination of Single-Employer Plans, Missing Participants
"The missing participant forms and instructions under this information collection are applicable only to plans that terminated on or before December 31, 2017.... PBGC is proposing to provide that the plan administrator of a plan terminating in a standard termination, or a distress termination that closes out in the private sector, may submit termination forms electronically (scanned and emailed or faxed), rather than by mail or personal delivery only.... [F]or distress termination filings, PBGC is proposing to include an invitation for plan sponsors to contact PBGC for a pre-filing consultation to discuss the filing process and ensure the filing of a distress termination is appropriate given the sponsor's specific circumstances."
Pension Benefit Guaranty Corporation [PBGC]

[Advert.]

Fundamentals of Qualified Retirement Plans for 2018, Part 3

Sponsored by ASC

It's not too late to join for Part 3 or the entire series. In this class, John Griffin, L.D., LL.M., will cover: Top-Heavy, Deduction Rules, Plan Distributions, Taxation of Distributions, Spousal Rights and Rollovers and Required Minimum Distributions.


401(k) Plan Documents: Keeping All Your Ducks in a Row
"[A table describes] several important documents that are smart to keep handy, either in the event of an audit, or to reference during the ongoing administration of the 401(k)."
ForUsAll

Making Sure 401(k) and 403(b) Fees Are 'Necessary' and 'Reasonable'
"[C]ontact at least six firms ... [Y]ou are held to the standard of an expert in matters of plan management. If you don't have the resources to run an RFP ... find an independent consultant who can do it for you.... Unless you are using an integrated RFP platform to issue your request, to receive and aggregate information and to perform your analysis, you will want to allow about four [4] weeks from the date you issue the RFP to the date responses are due."
Fiduciary Plan Governance, LLC

DC Participants with 401(k)s and HSAs Have Higher Savings Rates for 401(k) and Overall
"[P]articipants using a 401(k) plan in conjunction with an HSA had an average 401(k) savings rate of 8.9% plus another 2.9% for the HSA. By contrast, the savings rate for 401(k)-only participants was 6.8%."
Pensions & Investments

Fidelity Finds Increase in Retirement Plan Millionaires
"[T]he average 401(k) balance rose to $104,300 by year's end, finishing 2017 fully 13% higher than the close of 2016. The average IRA balance climbed to $106,000, which is also a 13% year-over-year increase, Fidelity says. These numbers compare with an average 401(k) balance of just $77,600 in 2012 and a 2012 average balance of IRAs at $76,600.... The number of 401(k) savers with at least $1 million in their 401(k) increased to 150,000 at the end of 2017, up from 93,000 a year ago."
PLANSPONSOR

[Advert.]

PSCA's 71st Annual National Conference, May 1-2, 2018, Scottsdale, AZ

Sponsored by Plan Sponsor Council of America [PSCA]

Join us in the Arizona desert to replenish and refresh your retirement plans. Hear from industry experts about issues, trends, and solutions. Spend two days drinking up knowledge that will rejuvenate your plan for the rest of the year! Register now!


Special Pension Committee Formed in Congress to Come Up with Multiemployer Bill
"Sen. Sherrod Brown [D-Ohio] ... during the Senate budget deal reached Wednesday ... secured a guarantee that whatever the select pension committee comes up with will get an expedited vote on both the House and Senate floors. The committee will have to hold at least five public meetings, including at least one field hearing so committee members can hear directly from affected retirees, workers and businesses."
Pensions & Investments

Retirement Reform Lessons: The Experience of Palm Beach Public Safety Pensions (PDF)
18 pages. "This case study of the Palm Beach experience offers an important cautionary tale on the detrimental impacts of switching public employees from DB pensions to DC accounts.... Dismantling the DB pension benefit caused a mass exodus of public safety officers.... [T]he unprecedented loss of new and experienced public safety officers caused the town's training cost to soar likely reaching upwards of $20 million ... The DC switch proved a failed experiment in Palm Beach."
National Institute on Retirement Security [NIRS]

Longevity and Technology Are Transforming the Way People Retire
"[W]hen social security was first introduced in the US in the 1930s, the average life expectancy at birth was just 58 for men and 62 for women. But today -- though still rare -- it's not unheard of to celebrate grandma's 100th birthday. Studies suggest that if life expectancy rates continue to increase at the speed they've experienced since the 1800s, centenarians may be the norm by the year 2100."
Voya

If You're Close to Retirement, Here's Where to Hide from Market Volatility
"[F]inancial advisors with clients who are near retirement or who have short-term goals are recommending that they keep a chunk of their savings in cash, certificates of deposit and money market funds.... Instead of yanking assets out of the market altogether, advisors have continued rebalancing portfolios and investing some of those proceeds in high-quality short-term bond funds."
CNBC

Retirement Savers Fled Equities in Market Selloff
"Retirement savers violated a cardinal rule of investing this past week: they sold into a plunging market. After racing into equities in January, they did an about-face as markets fell on Friday Feb. 2. Savers moved into money and fixed-income funds, trading at close to three times the norm[.]"
Bloomberg

Meet the Mediators Who Brokered $1B in 401(k) and other Employment-Related Settlements
"Mediators Hunter Hughes III and Robert Meyer are responsible for a chunk of the action. Between the two of them, they've helped negotiate over $1 billion in employment-related class action settlements over the past 10 years.... [Hughes] is a frequent mediator of excessive fee cases under [ERISA], having successfully mediated 12 of these cases since 2008.... [Meyer] has mediated workers' retirement benefits disputes, including cases where Wachovia, which was later acquired by Wells Fargo, and JC Penney were accused separately of investing their employees' retirement assets in the companies' own declining stock."
Bloomberg BNA

Benefits in General

[Guidance Overview]

Potential 'Gotchas' with the Tax Cuts and Jobs Act
"[The Act] narrows the ability to obtain a hardship distribution for a casualty loss.... [Employers] should check with their record keepers to ensure that they are aware of and prepared to administer the new rule.... [T]ax-exempt employers will be subject to unrelated business taxable income ('UBTI') for mass transit and parking benefits provided to their employees.... Tax-exempt employers who continue to provide on-site athletic facilities will be subject to UBTI."
Wilkins Finston Friedman Law Group LLP

What Is Driving Strong M&A Activity in the Benefit Brokerage Market?
"After a record year of mergers and acquisitions in the employee benefits sector, industry observers expect 2018 to be another great year for deals ... Some cite a strong economy and the desire of smaller benefit firms to band together in a market that remains complex, while others point to the recent passage of the Tax Cuts and Jobs Act."
Employee Benefit Adviser

Tax Bill Affects ERISA Settlements
"Any settlement of employment litigation should take account of taxes... The Tax Cuts and Jobs Act ... makes a number of changes ... The after-tax cost to defendants of a settlement has gone up. The 2018 corporate tax rate drops to 21 percent from generally 35 percent in 2017 ... If a corporate defendant settles for $100,000 in 2017, that will cost a net $65,000 after taxes. But if that settlement is made in 2018, it will cost the defendant $79,000 after taxes because the deduction saves fewer taxes."
Bob Blum Mediation

Selected Discussions
on the BenefitsLink Message Boards

Section 409A Comp Eligible for 401(k) Deferrals?
Is compensation that complies with IRC Section 409A eligible for 401(k) deferrals?
BenefitsLink Message Boards

Terms of Collective Bargaining Agreement Different Than Terms of Plan Document
What happens when a collective bargaining agreement differs than the terms of the plan document? Possibly the CBA was amended to provide a different match and employer contribution and the plan document was not amended accordingly, which I think can happen often. Some pre-approved documents have a check box to defer to the CBA. However, if the plan does not have this provision, which takes precedence? The plan or the CBA?
BenefitsLink Message Boards

Solo 401(k)'s First 5500: Hello, DFVCP
Client was self-administering his solo-401(k) from 1/1/2015 (effective date) through 9/1/2017 (when employees became eligible). Since then, my company has been administering the 401k. I had thought he was under the $250k threshold before this year (lesson learned: don't rely on client's assumptions). Assets on 12/31/2015 were less than $80,000; assets on 12/31/2016 were more than $250,000 but no Form 5500 was filed. I'm starting to work on the 5500 via DOL's DFVCP. We don't need to file a 2015 5500, correct? Also, the client should first file the late Form 5500 and then (immediately) file and pay for the DFVCP, correct?
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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2018 BenefitsLink.com, 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 BenefitsLink.com, 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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