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Republic Services
in AZ, CA, CO, NM, UT

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Pentegra
in OH

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[Official Guidance]

Text of PBGC Announcement: Future Disaster Relief Will Be Keyed to IRS Announcements

"PBGC is changing its practice to simplify how it announces disaster relief by referring PBGC filers directly to IRS' disaster relief news releases.... Instead of multiple disaster relief announcements, all explaining disaster relief in the same repetitive language, [this announcement] explains how PBGC disaster relief is keyed to IRS relief, what circumstances generally lead to relief, and the nature of relief generally granted. The qualifications for disaster relief and relief granted will be simpler and easier to apply.... With this Announcement, unless a filing is on the 'Exceptions List' ..., filers can be assured that PBGC grants disaster relief when, where, and for the same relief period that IRS grants relief for taxpayers affected by a disaster.... PBGC also may grant case-by-case relief for filings and actions on the Exceptions List." [FR Doc. 2018-14125, filed June 29, 2018; published July 2, 2018]
Pension Benefit Guaranty Corporation [PBGC]

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[Official Guidance]

Text of PBGC Disaster Relief Announcement 18-07, in Response to Storms, Flooding, Landslides, and Mudslides In Hawaii

"The Pension Benefit Guaranty Corporation (PBGC) is waiving certain penalties and extending certain deadlines in response to storms, flooding, landslides, and mudslides that began on April 13, 2018, in Hawaii.... The relief generally extends from April 13, 2018 through August 15, 2018. The disaster area consists of the City and County of Honolulu and Kauai County."
Pension Benefit Guaranty Corporation [PBGC]

[Official Guidance]

Text of IRS Form 14568-H: Model VCP Compliance Statement -- Schedule 8: Failure to Pay Required Minimum Distributions Timely (PDF)

"The plan identified above did not comply with the requirements of Section 401(a)(9) of the Internal Revenue Code (IRC) as required minimum distributions (RMD) were not paid in a timely manner or were less than what was required. When completing this table, affected plan participants should be counted separately under each year that an RMD was not made and not just in the first year of the failure." [Rev. June 2018]
Internal Revenue Service [IRS]

[Official Guidance]

Text of IRS Form 14568-E: Model VCP Compliance Statement -- Schedule 5: Plan Loan Failures (PDF)

"The plan identified above did not comply with the requirements of Section 72(p)(2) of the Internal Revenue Code (IRC). (Note: The conditions of IRC Section 72(p)(2) must be satisfied for a participant loan to be exempt from being treated as a distribution to the participant under IRC Section 72(p)(1).) The failure occurred for the following reason(s) (check applicable boxes and provide the information requested)." [Rev. June 2018]
Internal Revenue Service [IRS]

[Official Guidance]

Text of IRS Form 14568-B: Model VCP Compliance Statement -- Schedule 2: Other Nonamender Failures and Failure to Adopt a 403(b) Plan Timely (PDF)

"The plan identified above was not amended to comply with the applicable provisions of the following legislative and regulatory requirements by the applicable deadlines in accordance with Internal Revenue Code (IRC) Section 401(b) and the regulations thereunder[.]" [Rev. June 2018]
Internal Revenue Service [IRS]

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Xerox HR Solutions Wins Another Dismissal in ERISA Challenge

"In the original complaint, [Xerox HR Solutions] was accused of collecting excessive fees and engaging in a type of pay-to-play arrangement with Financial Engines Inc.... The text of the new decision says the amended complaint has failed because 'it is an attempt to replead dismissed counts,' and because it includes an entirely new cause of action, violation of the Racketeer Influence Corrupt Organizations Act [RICO]. Also problematic, it includes new parties, Xerox Corporation and Conduent, Inc." [Chendes v. Xerox HR Solutions, LLC, No. 16-13980 (E.D. Mich. June 25, 2018)]
PLANSPONSOR

Cash Balance Plans: 2018 Survey and Trends (PDF)

40 pages. "Cash Balance plans are prevalent among employers across many industries ... More than 90% of 'pure' cash balance plans -- i.e., plans with no legacy traditional annuity benefits -- continue to provide ongoing benefit accruals. Close to 60% of 'mixed' cash balance plans -- i.e., plans which arose due to the conversion from a traditional annuity plan -- continue to provide benefit accruals.... Plans that credit a market interest crediting rate enjoy the best and most stable funded status among cash balance plans, with more than 90% of such plans being fully funded."
October Three Consulting

Reaching New Markets: Cash Balance Strategic Plan Terminations

"[T]he new cash balance plan must look at least a little different from the old plan.... [C]hanging the crediting rate or altering the group of employees covered should do the trick, and there needs to be one or multiple clear business necessities that are cited for making the change."
planadviser

Optimizing Your Company's Retirement Plan

"[F]ocus on four key elements: [1] getting employees into the plan; [2] getting them to save an adequate amount of money toward their retirement goals; [3] getting them invested appropriately based upon their specific circumstances; and [4] getting plan participants engaged in the saving, investing, and, ultimately, retirement planning process."
CAPTRUST Financial Advisors

Finally Final: Court's Mandate Terminates DOL Fiduciary Rule

"The DOL has remained silent following the Fifth Circuit's June 21, 2018, mandate officially invalidating the investment fiduciary guidance.... [T]he SEC has indicated that [its] final guidance will generally include advice given to retirement savers who are invested in securities and are receiving investment advice from broker-dealers or registered investment advisors."
Ascensus

[Opinion]

Merrill Lynch Took the Lead on the DOL Rule, Now It's Wrapping Its Flip-Flop in the Same Pious Intent

"When it looked like the DOL fiduciary rule was a foregone conclusion two years ago, Merrill Lynch jumped ahead of pack and announced the end of commission-based IRAs with a major advertising campaign exalting its holier-than-thou embrace of the controversial regulation.... When the rule finally died in the federal 5th Circuit Court of Appeals earlier this month, Merrill's reaction was swift.... [It] announced it would be re-examining its position over the next 60 days -- in the name of providing more 'choice.' "
Lisa Shidler, in RIABiz

[Official Guidance]

Text of IRS Disaster Relief Notice HI-2018-03, for Victims of Storms, Flooding, Landslides and Mudslides in Hawaii

"Victims of severe storms, flooding, landslides and mudslides that occurred starting on April 13, 2018 in Hawaii may qualify for tax relief ... Individuals who reside or have a business in the City and County of Honolulu and Kauai County may qualify for tax relief.... [C]ertain deadlines falling on or after April 13, 2018, and before Aug. 15, 2018, are granted additional time to file through Aug. 15, 2018."
Internal Revenue Service [IRS]

Is Arbitration the Future for ERISA Claims?

"Absent further legislation by Congress amending the Federal Arbitration Act or state legislation permitting private attorney general actions such as California's Private Attorneys General Act, the enforceability of mandatory arbitration programs with class waivers can be assured. Employers and plan sponsors who do not have such arbitration programs need to be aware of this significant development and at least consider whether an arbitration program with a class waiver is appropriate for them"
Seyfarth Shaw, via Lexology

Frozen Cash Balance Plan: Should Interest Credits Continue Through Actual Distribution Date?

A cash balance plan is frozen 6/30 with an estimated distribution date of November 30. The plan's interest credits were also frozen at 6/30. Permissible? Or should interest credits continue through the distribution date?
BenefitsLink Message Boards

'Entry Date' Upon SEP Eligibility?

Employer who has a SEP for himself hired an employee in 2016. Employee works throughout 2016, 2017 and 2018. Question is whether the employee is eligible for the SEP for 2018. I think yes, since they have worked 3 out of the last 5 years (3 of 3 here). I have someone telling me that they are not eligible until 2019.
BenefitsLink Message Boards

Change in Hours Required for Vesting

I have a client that would like to change the hours required for a "year of service" for both eligibility and vesting from 1,000 hours to 750 hours. For eligibility, as of the effective date of this change, I believe we will need to allow all employees to enter the plan if they have worked at least 750 hours in a year, even if it was a long time ago. For vesting, do we need to adjust vesting based upon prior years of service during which an employee worked 750 hours (even if they were not in plan and/or did not work 1,000 hours)? I think not. I would prefer that the reduction in hours for a year of vesting service is applied on a prospective basis.
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