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[Official Guidance]
Text of IRS EP Examination Memo TE/GE-04-0218-0011: Missing Participants and Beneficiaries and Required Minimum Distributions -- 403(b) Plans (PDF)
"For purposes of IRC Section 403(b)(10), EP examiners shall not challenge a 403(b) contract for violation of the RMD standards for the failure to commence or make a distribution to a participant or beneficiary to whom a payment is due, if the plan has taken the following steps: [1] searched plan and related plan, sponsor, and publicly-available records or directories for alternative contact information; [2] used any of [three listed] search methods ... and [3] attempted contact via [USPS] certified mail to the last known mailing address and through appropriate means for any address or contact information (including email addresses and telephone numbers)."
Internal Revenue Service [IRS]
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Retirement Savings Opportunities for High Earning Owners and Professionals
"[F]or most high-earning owners and professionals, the evaluation of the tax effectiveness of their 401(k) and cash balance plan will involve only a change in tax rate from 39.6 percent to 37 percent.... [T]his may cause subtle changes in design and contribution levels, but it does not change fundamental decisions on whether to adopt one or both plan types."
Findley Davies | BPS&M
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More 401(k) Plans Moving Away from Revenue-Sharing Model
"[A] Callan survey showed that 54.7% of plans used a per-participant fee last year to pay for plan administration vs. 41.6% in 2016.... A survey ... by Willis Towers Watson PLC found 41% of plans used a fixed-dollar amount per participant for record-keeping fees vs. 32% in 2014 ... DC industry members said there's room for revenue sharing depending on plans' unique circumstances. And in the case of 403(b) plans with lineups heavily weighted toward annuities, sponsors cannot easily drop revenue sharing."
Pensions & Investments
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Should Plan Sponsors Consider Investing Retirement Plan Assets in Bitcoin? (PDF)
"Because cryptocurrency cannot be held and only exists as a few lines of computer code, the chance of it vanishing completely would be a concern to a plan sponsor who must have assets independently in the custody of a trust company.... One of the biggest challenges of bitcoin is its intangible nature.... Plan sponsors have to be able to know they own a particular asset and can value it in an accurate and timely fashion.... Cryptocurrencies remain a significant target for hackers and thieves."
Milliman
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[Advert.]
PSCA's 60th Annual Survey of Profit Sharing and 401(k) Plans
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Fidelity Puts 6 Million Savers on Risky Path to Retirement
"While deposits in the trillion-dollar sector have surged, Fidelity has seen nearly $16 billion in net withdrawals over the past four years ... The exodus stems in part from unease with the way Boston-based Fidelity has boosted performance -- by ramping up risk.... Fidelity portfolio managers now try to time market shifts, for instance by moving billions of dollars out of money-losing commodities bets and into Chinese stocks and U.S. tech shares[.]"
Reuters
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How to Generate Retirement Cash Flow by Rebalancing
"A trap some retirees can fall into when it comes to retirement income planning is limiting their strategy to interest and dividends and neglecting the power of rebalancing to capture portfolio growth as an additional income source."
Charles Schwab
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[Opinion]
Senate 'Loan' Bill Is a Poorly Disguised Bailout for Private Pensions
"Do we want government to encourage private employers and unions to promise workers more than they can afford and then fail to set aside the money necessary to meet those promises? Because that's exactly what this proposal would do -- encourage the same reckless behavior that contributed to the $500 billion shortfall faced by roughly 1,300 multi-employer pension plans today. Unlike loans made in the private sector, which happen only where a legitimate expectation of repayment (and a risk-compensating interest rate) can be established, loans to insolvent pension plans would have a high expectation of default."
The Heritage Foundation
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Benefits in General
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Should You Transfer Money from an IRA to an HSA?
"[T]ransferring money from an IRA to an HSA will be of limited value, except in a small handful of cases. Most other IRA owners should leave their IRA assets intact and fund their HSAs with non-IRA dollars, the better to maximize contributions to both account types and take advantage of tax-sheltered savings."
Morningstar Advisor
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Executive Compensation
and Nonqualified Plans
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New Tax Law Provides Tax Deferral Opportunity for Certain Private Company Equity Grants
"[New] Code Section 83(i) ... will allow certain private company employees to defer federal income tax on eligible stock options and restricted stock units for up to five years following their respective exercise or settlement.... Section 83(i) could be useful for bridging the gap between when an employee is subject to income tax and when the employee's shares can be liquidated."
Morgan Lewis
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Selected Discussions
on the BenefitsLink Message Boards
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Deducted Too Much Pretax; How to Fix?
Participant went into the website of the Investment company and changed his pretax deduction from 10% to 2%. This was not picked up by payroll for 2 months, December and January. So too much was deducted from his paycheck. He wants the money. Should the excess be forfeited as a mistake of fact and the Participant made whole outside the plan? Should it be distributed to the Participant as an excess with the Plan issuing a 1099?
BenefitsLink Message Boards
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Age 20-1/2 Eligibility Requirement?
Plan has this eligibility: Age 20-1/2, 1 YOS (1,000 hrs). Entry date: First day of plan year following. That's it. On the surface it seems it violates the 18 months rule, but I am half-remembering that the age 20-1/2 aspect somehow buys the plan an extra 6 months.
BenefitsLink Message Boards
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EPCRS Correction for 3% SH with Non-SH Match
Plan is safe harbor non-elective with a 100% of 2% non-safe harbor match. A rehired employee was not given the opportunity to defer for 2017. I know that the fix for the deferral piece is 50% of the 3% plus the 3% safe harbor. But what about the match piece? I understand the regs to be 2% match. The employee's missed deferral was 3% (because of safe harbor non-elective), so the match is 100% of 2%?
BenefitsLink Message Boards
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BenefitsLink.com, Inc.
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David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager
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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