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ERISA Attorney
Barclay Damon LLP
in Syracuse NY / Albany NY / Buffalo NY / Rochester NY

Bilingual Call Center Representative - Retirement Plans
The Standard
in Portland OR / Cincinnati OH

Account Manager
Beneco Systems, LLC
in Scottsdale AZ

Account Associate
Beneco Systems, LLC
in Scottsdale AZ

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[Guidance Overview]

IRS Cracks Open the Window for Retiree Lump Sums

"[Notice 2019-18] provides that the IRS will no longer assert that a plan amendment providing for a retiree lump-sum window program causes the plan to violate the required minimum distribution rules. The Notice states that the IRS and Treasury Department will continue to consider the issue of retiree lump sums generally, will not issue private letter rulings on this topic while it remains under consideration, and will continue to evaluate whether plans offering these lump sums satisfy other tax qualification requirements."
Eversheds Sutherland


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 See Lifetime Income Proposals as Low-Priority Item

"Year after year, most sponsors lament the lack of a federal legislative and/or regulatory safe harbor to protect them against fiduciary risk in offering in-plan solutions such as annuities. They fret that such in-plan retirement income products are too expensive, too complicated and too lacking in portability. And year after year, many sponsors say such in-plan solutions aren't a top priority and that participants aren't clamoring for them."
Pensions & Investments

ERISA: Thou Shall Not Pay Excessive Fees!

"While there have been recent, yet expensive, victories for not-for-profit plan sponsors in the Section 403(b) space, plan fiduciaries should not get too comfortable. There were also early victories in the 401(k) cases that were filed in 2006. However, the tide turned and some of those Section 401(k) cases ended up settling in the multi-million dollar range ... Litigation is not limited to large plans, as plaintiffs and the DOL have found that smaller plans are 'low hanging fruit' in terms of finding ERISA violations."
CKR Law, via Real Property, Trust and Estate Law [RPTE] eReport, American Bar Association

Retirement Savings Shortfalls Improve

"For 2019, [EBRI's Retirement Security Projection Model (RSPM®)] finds that 40.6 percent of all U.S. households where the head of the household is between 35 and 64, inclusive, are projected to run short of money in retirement. That is down by 1.7 percentage points vs. 2014. The model finds that the aggregate retirement deficit American households in this age cohort face, taking into account current Social Security retirement benefits, is currently estimated to be $3.83 trillion. The similar figure (adjusted for inflation) from 2014 was $4.44 trillion."
Employee Benefit Research Institute [EBRI]

House Panel Hears Ideas for Solving 'Urgent' Multiemployer Crisis

"Without congressional action, participants in struggling plans face benefit cuts of 50% or more; when the PBGC multiemployer program itself becomes insolvent as projected to happen by 2025, those cuts will deepen to 90% ... Over a 30-year horizon, an estimated $32 billion to $103 billion in taxes would not be paid if some plan participants lose their pension benefits, while government social safety program costs could increase $170 billion to $240 billion."
Pensions & Investments


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A Look at Employee Tenure: The Career Job Fallacy and the Impact of Low Unemployment (PDF)

"Over the past 35 years, median tenure has stayed at approximately five years.... [W]hile fewer workers have 25 or more years of tenure now vs. decades ago, even in the early 1980s, 'career' employees were in the minority.... [T]he proportion of workers with shorter tenures has increased since 2010."
Employee Benefit Research Institute [EBRI]

Benefits in General

[Guidance Overview]

Plans Cannot Prevent Participant from Appointing an Authorized Representative

"[The DOL] has reiterated that an ERISA-covered plan cannot prevent a plan participant from appointing an authorized representative for initial claims and for claims appeals.... The DOL letter only refers to the appointment of an authorized representative and does not discuss the assignment of benefits.... An assignment transfers ownership of a claim to a third party, giving it standing to assert those rights and to sue on its own behalf. The appointment of an authorized representative, on the other hand, does not transfer an ownership interest in the claim."
The Wagner Law Group

2018 in Review: DOL-Issued Guidance under ERISA

"DOL continued in 2018 a very limited advance guidance program, with an output roughly comparable to that of 2017.... This trend of limited guidance dates to at least 2013 and thus cannot be wholly attributed to the regulatory proclivities (or lack thereof) of the current Administration. For a variety of reasons, DOL has simply become less engaged in delivering advance guidance to the regulated community."
Eversheds Sutherland

Executive Compensation
and Nonqualified Plans

Planning for the 4960 Excise Tax on Compensation by Tax-Exempt Organizations

"[T]ax-exempt systems that include more than one related tax-exempt organization will likely have more than five covered employees.... Determine covered employees -- once a covered employee, always a covered employee.... Compile remuneration for covered employee status and the annual $1 million limit.... Calculate potential parachute payments.... Determine when tax is payable.... Create term sheets and termination scenarios.... Consider fiscal year tax-exempt organization remuneration special rules.... Begin long-term planning."
Willis Towers Watson

Selected Discussions
on the BenefitsLink Message Boards

Mom Answers Phone as Employee for 10 Hours/Year -- Include Her for Nondiscrimination Testing?

Business owner has Mom come in for 10 hours a year. Comp is $450. She was eligible to participate once upon a time -- she had worked in the office for about a year and had hit her 1,000 hour requirement. Needless to say, as a "zero" in the discrimination testing, she has a nice favorable impact. I am reading the Carol Gold memorandum and commentary by Relius. The memo certainly could have made noise about this type of arrangement, but it didn't. Would you exclude her from the testing based on the Gold thought process, or include her without worry?
BenefitsLink Message Boards

401(k) Hardship Withdrawal for Purchase of Primary Residence

A participant needs a 401k withdrawal for purchase of a primary residence. Does the plan administrator contact the lending institution? If work needs to be done to the residence being purchased (e.g., a new roof), can that be counted as a construction cost?
BenefitsLink Message Boards

QDRO Needed If Marriage Has Been Annulled?

Am I right in assuming that no QDRO is necessary in the case of an annulment (because it's as if the two were never married)? Our client is questioning the documentation, which states an annulment occurred, not a divorce.
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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