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January 7, 2019 logo logo
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Senior Pension Administrator
Scholz & Friends Enlightened Retirement Group, Inc.
in TX

Sr. Pension Administrator
Lafayette Life Insurance Company
in OH

Retirement Plan Regional Director-West Coast
Retirement Plan Consultants
in AZ, CA, NV, UT

Defined Benefit Analyst
Columbus, Ohio Benefits Company
in OH

Senior Retirement Compliance Consultant
CUNA Mutual Group
in WI

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[Official Guidance]

Text of 2018 Instructions for IRS Form 8955-SSA: Annual Registration Statement Identifying Separated Participants with Deferred Vested Benefits (PDF)

Jan. 2, 2019. "Plan administrators of plans subject to the vesting standards of section 203 of ERISA must file Form 8955-SSA.... Sponsors and administrators of government, church, and other plans that are not subject to the vesting standards of section 203 of ERISA (including plans that cover only owners and their spouses) may elect to file Form 8955-SSA voluntarily."
Internal Revenue Service [IRS]


P&I DC East Conference | Ft. Lauderdale | Mar 10-12

Sponsored by Pensions & Investments

Join leading executives who manage 401(k), 403(b), 457 and TSP plans at DC WEST. You'll learn how other plan sponsors analyze, develop, implement and measure programs for their participants, so you can improve your own plan.

Ninth Circuit Opines on Effect of Actual Knowledge on ERISA's Statute of Limitations

"The Ninth Circuit's holding on this point make sense; a prohibited-transaction claim can be brought based solely on knowledge that a transaction occurred, thus the date a plaintiff learns of the transaction should start the three-year limitations period. But the Ninth Circuit's interpretation of 'actual knowledge' is practically problematic. A defendant will have to prove that a plaintiff in fact read materials in order to show a plaintiff had knowledge of facts contained in those materials." [Sulyma v. Intel Corp. Investment Policy Comm., No. 17-15864 (9th Cir. Nov. 28, 2018)]
McDermott, Will & Emery, via National Law Review

Mutual of Omaha ERISA Plaintiffs Defeat Motion to Dismiss

"Citing a series of precedent-setting cases, Senior U.S. District Judge Joseph F. Bataillon of the U.S. District Court for the District of Nebraska [explained] that an ERISA complaint of this nature does not need to describe in exhaustive detail the ways in which plaintiffs claim defendants breached their fiduciary duties." [Lechner v. Mutual of Omaha, No. 18-22 (D. Nebr. Dec. 31, 2018)]

Prepare to Electronically File Your VCP Submissions

"[Rev. Proc. 2018-52 provides] the latest official guidance consolidating the rules and procedures that govern [EPCRS]. The most significant change is a shift from paper filing to mandatory electronic filing for all [VCP] submissions.... Effective on or after April 1, 2019, electronic filing (including payment of user fees) via the website will be mandatory."
Compliance Dashboard

2017 Tax Law Change Provides Relief to Workers with 401(k) Plan Loans Who Lose Their Jobs

"[T]he Act defines the employment termination event that triggers the extended rollover period as a 'severance from employment.' ... [In] a situation in which a company sells some of its assets ... and transfers some of its employees to the buyer ... the transferred employees are in many instances doing the same work both before and after the transaction, ... with the potential implication that they did not really terminate employment, even though the transfer to the buyer's payroll means that their loans with the selling company's 401(k) plan are called."
Blank Rome LLP


P&I DC East Conference | Ft. Lauderdale | Mar 10-12

Sponsored by Pensions & Investments

Join leading executives who manage 401(k), 403(b), 457 and TSP plans at DC WEST. You'll learn how other plan sponsors analyze, develop, implement and measure programs for their participants, so you can improve your own plan.

Benchmarks for Target Date Funds (PDF)

10 pages. "This article describes the benchmarks that are currently available and offers some guidance on selecting the appropriate benchmark. Fiduciaries should align the objectives of their TDF with those of the benchmark, and confirm that the benchmark glide path and underlying allocations are in line with the TDF that is being evaluated."
Target Date Solutions, via Journal of Performance Measurement

California's New State-Run Retirement Program for Private Sector Employees Gets Under Way

"A taxpayers' rights group is challenging the program, claiming that it violates the U.S. Constitution.... Beginning in July, all eligible employers in the state will be able to enroll their workers. Eventually, most California employers that lack a retirement savings plan will be required to do one of two things: either enroll their workers in CalSavers or provide a retirement plan through the private market."
Society for Human Resource Management [SHRM]

DB Pensions vs. 401(k)s: A Study of Teacher Retirement Programs in Six States

"Eight out of ten educators serving in the six states studied can expect to collect pension benefits that are greater in value than what they could receive under an idealized 401(k)-type plan. The study also finds that the typical teacher in these states that offer pensions will serve 25 years in the same state, while two out of three educators will teach for at least 20 years."
National Institute on Retirement Security [NIRS]

Money Down the Drain During Typical De-Risking Process?

"[M]any investor and asset managers have historically been nonchalant in the transition of assets to fixed income mandates.... The investor leaves assets uninvested in cash until the new manager invests the cash into a complete fixed income portfolio.... This uninvested cash can lose out on investment income relative to yield-rich long-duration credit. As such, plan performance suffers.... [In] a suboptimal approach of giving uninvested cash to a fixed income manager, you should assume that your plan loses about one basis point (bp) of investment income per day. Could be more, could be less, but on average your assets are losing precious income."
Russell Investments


Meaningful Reforms to the Regulation of Investment Advice are Possible

"[This article sets] forth two major rules the SEC could adopt, in lieu of its current proposed Reg BI. The first rule would be adopted under the Advisers Act and would define, correctly, the scope of the broker-dealer exemption from the requirement to register under the Advisers Act. The second major rule herein would define the scope of the investment adviser's fiduciary obligation, in order to correct misunderstandings that might otherwise have resulted over time."
Ron A. Rhoades, JD, CFP

Executive Compensation
and Nonqualified Plans

[Guidance Overview]

IRS Issues Notice 2019-09 Providing Interim Guidance Under Code Section 4960

"Among other topics, the Notice addresses: [1] What year is used in calculating the excise tax? [2] Who is liable for the excise tax? [3] What is an [applicable tax-exempt organization (ATEO)]? [4] Who is a covered employee under Section 4960? [5] What is an excess parachute payment under Section 4960? [6] How do you compute excess parachute payments under Section 4960? [7] How do ATEOs and related organizations report and pay the excise tax imposed under Section 4960? [8] What is the effective date of Section 4960?"
Thomson Reuters Practical Law

Selected Discussions
on the BenefitsLink Message Boards

Must Advise Participants of Deemed Default on Loans at Termination of Employment?

Any requirement that participants must be notified that their loans will be defaulted when they terminate employment? I have a large plan whose loans are administered by the recordkeeper. We as a TPA have minimal involvement. We used to send out default letters to the participants, but because the loans are handled by the recordkeeper, we're not going to do that. No such notice is sent out by the recordkeeper, which is deeming the loans as distributed for non-payment. Is a notice legally required?
BenefitsLink Message Boards

Is Life Insurance Value Reportable as a Plan Asset on Form 5500 Schedule H?

I'm a CPA working on a Form 5500 audit (it's a new account for us). The plan is a defined contribution profit sharing plan that owns four life insurance policies with a total cash surrender value that comprises ~40% of plan assets. Are these contracts required to be reported on Form 5500 at cash value?
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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 2019, 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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