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February 19, 2019 logo logo
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Defined Benefit Plan Administrator
Sunwest Pensions
in Tempe AZ / Telecommute

DC Consultant / Relationship Manager
Boyce & Associates, Inc.
in Phoenix AZ

Retirement Plan Consultant
DWC - The 401K Experts

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Webcasts, Conferences

403(b) Universal Availability
March 19, 2019 WEBCAST

Second Quarter 2019 Washington Update
May 22, 2019 WEBCAST
ASPPA [American Society of Pension Professionals & Actuaries]

►See 162 Upcoming Webcasts and Conferences

►See 1485 Recorded Webcasts


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Hardship Distributions and Recent IRS Changes

"Under the new rules, a plan sponsor can accept a written statement from the participant where they certify there is a financial need.... [Other changes include:] [1] No plan loan requirement -- although [this change] is not mandatory ... [2] Allow for further contributions ... This mandatory rule is effective January 1, 2020 but can be applied earlier. [3] Investment earnings distribution ... 403(b) plans still prohibit investment earnings to be counted for hardship withdrawals."


2019 SPARK National Conference -- June 4-5, Falls Church, VA

Sponsored by SPARK

The retirement services industry's leading event for top marketing, sales, administration and record keeping professionals. Comprehensive agenda is designed to meet the needs of 401(k) Plan Providers, Financial Advisors and Record Keepers.

Sponsors of Defined Contribution Plans Still Sharply Focused on Fees

"Plan fees' top rank for sponsor focus over the next 12 months replaced last year's highest-rated area, retirement readiness, which fell to the middle of the pack for 2019. Participant communication and financial wellness (a new category this year) were the next two highest-rated areas of focus for 2019."
HR Daily Advisor

Piling On: Corporations Support the New York Times in Multiemployer Pension Calculation Dispute

"Several large employers are disputing how much money the New York Times owes a union multiemployer pension fund. Recently, six companies ... filed an amicus brief supporting the New York Times in its case before the US Court of Appeals for the Second Circuit.... The underlying issue in this case involves an actuarial method called the 'Segal Blend,' which often is used to value unfunded vested benefits and calculate withdrawal liability (an exit fee) from a union multiemployer pension plan."
McDermott Will & Emery

Evidence Supports the Value of Actuarial Second Opinions for Plan Sponsors

"Nearly 70% of finance professionals believe their company has made significant business decisions based on bad financial data.... Roughly one-fourth said they were concerned about errors they know to exist, but hadn't identified.... With required contributions annually in the millions or even hundreds of millions or billions of dollars for many longer-term plans, the cost-value trade-off of a second opinion seems clear. If a plan sponsor got meaningful value one year in ten from such a second opinion, they will have paid for all ten of them many times over."
Benefits and Compensation with John Lowell

What Life Expectancy Should You Use When Planning for Retirement?

"Most financial advisers assume extreme longevity in their retirement plans as a way to 'test' the odds of success against longevity risk. Clients often see illustrations assuming a lifespan of 95 or 100. And certainly, some of us will be fortunate enough to reach those lofty numbers.... But a plan using these conservative assumptions also creates risks and challenges."
Morningstar Advisor

'Gap Analysis' for IRA Beneficiaries

"The gap period begins on the date of death of an IRA owner and ends on September 30 of the following year. A significant amount of planning activity can, and should, take place within this window, including: [1] Post-death distributions (i.e. 'cash-outs') ... [2] Account splitting ... [3] Disclaimers."
Slott Report

Could Home Equity Be Key to Solving the Country's Looming Retirement Crisis?

"Pensions have dwindled, Social Security is insufficient, health care costs are rising and people are living longer than ever before, carrying little resources with them into retirement. But many older Americans do have one major source of wealth at their disposal: their house.... [S]ome experts are insisting that reverse mortgages -- which allow older homeowners to access their home equity and remain in their homes -- are an important public policy that must be preserved for future generations."


ICI Comment Letter to SEC on Updated Disclosure Requirements and Summary Prospectus for Variable Annuity and Variable Life Insurance Contracts (PDF)

15 pages. "We recommend that the Commission make the following additional enhancements to the Appendix, consistent with mutual fund disclosure requirements: [1] Permit VIP issuers to include a statement informing investors how and where they may obtain more current portfolio company performance information; [2] Permit VIP issuers to provide, in addition to performance information for each portfolio company for the past 1-year, 5-year and 10-year periods, performance information for the life of the portfolio company, if longer than 10 years; [3] Permit VIP issuers to include a portfolio company's net expense ratio after any waivers and/or reimbursements; and [4] Require disclosure only of those portfolio company sub-advisers that manage a significant portion of the portfolio."
Investment Company Institute [ICI]

Benefits in General

Feasibility and Reliability of Automated Coding of Occupation in the Health and Retirement Study

"[The NIOSH Industry and Occupation Computerized Coding System (NIOCCS)] does reasonably well compared to coding results from a highly-trained, professional occupation and industry coder, with ... agreement rates on broader codes of around 80 percent. The main weakness of NIOCCS appears to be its failure to produce codes in many cases. Code rates for NIOCCS for the datasets tested ranged from 60 to 72 percent, as compared to a professional coder's ability to code those same datasets that ranged from 95 to 100 percent."
Michigan Retirement and Disability Research Center, Univ. of Michigan

Selected Discussions
on the BenefitsLink Message Boards

Pro Rata Deduction Required for DB Plan's Initial Short Plan Year?

DB plan has an initial short plan year. Effective date is 7/1/2018 and the actuarial valuation date is 12/31/2018. Does the deduction for 2018 need to be applied pro rata?
BenefitsLink Message Boards

Deduct 2 Years' DB Plan Contributions in Only 1 Tax Year?

Taxpayer needed large 2017 tax deduction and was advised to adopt a DB plan in November 2017 with a November 30 plan year-end. Taxpayer funded PYE 11/30/17 in November 2017, funded PYE 11/30/18 in early December 2017 and claimed deduction for both contributions on 2017 calendar year tax return. Smells fishy to me. Is this allowable?
BenefitsLink Message Boards

SH Matching Plan -- OK to Amend Mid-Year to Provide More Generous Eligibility?

Our company has a safe harbor matching plan. I know there are very few amendments that can be made during a plan year. Is it possible to amend the plan to allow a more generous eligibility/entry? Currently, our provisions are the maximum statutory requirement -- 21/1 YOS, semiannual entry. I would like to move to 6 months of service, quarterly entry. Can do?
BenefitsLink Message Boards

Handling Elective Deferrals When Successor Plan Exists

Sal Tripodi has a blurb about the options for elective deferrals if a successor plan exists, and I don't quite understand what he's saying. He gives option #1 as "Transfer the deferrals to the successor plan (most commonly used option)." If a plan is terminated, participants must be given the option to have their funds distributed, either taxable or as a rollover to another plan. But a rollover is still a distribution. So what does this really mean?
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Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
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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