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February 15, 2019 logo logo
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Fi401k Advisors, LLC
in Greenwood Village CO

Tax Analyst, Retirement & Group Disability
in Newark NJ

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[Official Guidance]

SEC Extends Comment Period for Proposed Updated Disclosure Requirements and Summary Prospectus for Variable Annuity and Variable Life Insurance Contracts

"The public comment period for the proposed rulemaking Updated Disclosure Requirements and Summary Prospectus for Variable Annuity and Variable Life Insurance Contracts ... will now end on March 15, 2019. The scope and comment process for this release remains as stated in the original Federal Register notice of November 30, 2018."
U.S. Securities and Exchange Commission [SEC]


Register by February 25 for Early Bird Rate! Join Us in April.

Sponsored by International Foundation of Employee Benefit Plans [IFEBP]

Attend Investments Institute to secure a thorough understanding of key issues impacting your fund's long-term investment strategy. This conference will explore topics like private markets, behavioral biases and the retirement landscape. Register now.

[Official Guidance]

Text of 2018 Instructions for IRS Form 8915B: Qualified 2017 Disaster Retirement Plan Distributions and Repayments (PDF)

"File 2018 Form 8915B if any of the following apply. [1] You received a qualified 2017 disaster distribution from an eligible retirement plan in 2018. [2] You received a qualified 2017 disaster distribution in 2017 that you are including in income in equal amounts over 3 years. [3] You made a repayment of a qualified 2017 disaster distribution in 2018."
Internal Revenue Service [IRS]

[Guidance Overview]

Editor's Pick Answers for Employers About California's State-Mandated Retirement Plan

"What is CalSavers? ... Which employers must participate? ... When is it effective? ... What are the advantages of participating in the CalSavers program? ... What are the drawbacks of the CalSavers law? ... How does an employer participate in CalSavers? ... What are the penalties for failing to comply with CalSavers? ... What is the status of CalSavers? ... Do any other states or cities have similar laws?"
Jackson Lewis P.C.

Categorical Conflict of Interest Does Not Alter Standard of Review of Benefit Denials

"The Second Circuit held that plaintiffs' allegations that the defendant suffered from a 'categorical potential conflict of interest' -- because it both funded the plan and was the claim's decision-maker -- did not affect the application of the arbitrary and capricious standard of review in the absence of a showing by the plaintiffs that the conflict actually affected the plan administrator's decision-making." [Kirkendall v. Halliburton, Inc., No. 17-3487 (2d Cir. Jan. 24, 2019)]
Proskauer's ERISA Practice Center

403(b) Plan Participants Drop ERISA Lawsuit Against Long Island University

"Participants in a 403(b) plan run by Long Island University have dropped their ERISA lawsuit after having accused plan manager of having allowed excessive fees.... The record keeper, TIAA-CREF, was not named as a defendant." [Mulligan v. Long Island Univ., No. 18-2885 (E.D.N.Y. Feb. 8, 2019)]
Pensions & Investments


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Unusual Facts Help Preserve Stock Drop Claim Based on Nonpublic Information

"If the existence of a breach depends on the fiduciary's reasonable expectation of future harm, this case suggests that economic data showing the likelihood of future harm in analogous situations may be relevant. And if the expected future harm is a market overreaction, this case suggests that trading in an efficient market might neutralize that concern." [Jander v. Ret. Plans Comm. of IBM, No. 17-3518 (2d Cir. Dec. 10, 2018)]
Thomson Reuters / EBIA

Ensuring a Clean Recordkeeper Conversion

"[It's] a good idea for plan sponsor to conduct 'a mini audit of the plan before the conversion.' ... Ensuring data from the old service provider is accurate is also key ... One of the most common glitches ... is with moving assets from the old recordkeeper to the new one.... Some funds have a 12-month put or other contractual timeline requiring advanced notice before moving out of them."
PLANSPONSOR; free registration may be required

Public Pension Plan Sponsors Struggle to Contribute Sufficiently to Plans

"Between 2005 and 2016, employer contributions to 133 large state and municipal pension plans more than doubled from $42.4 billion to $88.1 billion; however, during that same period, the unfunded liabilities of these plans grew 245% from $290 billion in 2005 to $1.0 trillion in 2016 ... Most of the plans studied received insufficient contributions to reduce their unfunded liabilities[.]"
PLANSPONSOR; free registration required

Many Furloughed Federal Workers Withdrew from Retirement Funds

"More than one quarter of the 800,000 federal employees who were affected by the federal government shutdown withdrew money from their retirement funds to help make it through the 35 days in which they did not see a paycheck ... [F]our in 10 of these federal workers borrowed money from family or friends, while 20 percent took out a bank loan to help tide them over."

Top Concern During Retirement: Going Broke

"Running out of money is the top financial concern of clients planning for retirement, cited by 30 percent of CPA financial planners.... Nearly half (48 percent) of clients have expressed concerns about outliving their money ... [T]hat outweighs the 39 percent of planners who have concerns about their clients outliving their money.... [H]ealthcare costs (77 percent), market fluctuations (53 percent) and unexpected costs (50 percent) were cited as the top issues."
American Institute of Certified Public Accountants [AICPA]

Executive Compensation
and Nonqualified Plans

Trends in Executive Compensation and Compensation Committee Practices

"Impact of tax legislation on pay practices ... Key considerations for 2019 proxy season ... The SEC's new hedging policy disclosure rule ... The SEC cracks down on inadequate perquisite disclosures.... Pay audits and disclosures: best practices."

Selected Discussions
on the BenefitsLink Message Boards

Contribution to DC Plan Exceeded Section 404 Limit: Idea for Fixing It

We have a client with a 401(k)/profit sharing plan that has a large nondeductible contribution amount for 2018. We can reduce it a bit by pushing a post-year-end deposit into the 2019 fiscal year deduction. Another option may be to retroactively amend the plan to bring in an excluded class, and employees who had not met initial eligibility, and give them a profit sharing allocation (the plan is not Top Heavy). I know this would require approval under VCP to be sure it's acceptable. If the client were to do that (assuming waiving the VCP submission), what would likely be considered a "meaningful benefit"?
BenefitsLink Message Boards

Amending Matching Contribution Provisions to Add Last Day Employment/Minimum Hours Requirement

Plan sponsor currently does not impose any last day employment/minimum hours of service requirement to receive a match. Match is discretionary and is only made at the end of the plan year. Plan sponsor wants to add a last day employment/minimum hours requirement for 2019. Can that be done effective March 1, 2019 if it only applies after March 1? For example, plan sponsor wants to apply current rules for all contributions for January and February, but impose the last day employment/minimum hours requirement for any match made any time after March 1.
BenefitsLink Message Boards

All in the Family: Fidelity Bond Required?

Plan's only employees/participants are a husband/wife and 3 children. Assets are held in FBO self directed accounts for each, but there are also non-qualified assets (mortgages and some other real estate), which are segregated in the owner (husband's) name, so his account is the only one affected by their value. Is he required to have a fidelity bond for the non-qualified assets? There are employees other than family members.
BenefitsLink Message Boards

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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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