Retirement Plans Newsletter

May 10, 2019

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Jobs

HSA Account Administrator
Alerus Financial
in Albert Lea MN

Retirement Relationship Manager
Alerus Financial
in East Lansing MI

Pension Plan Administrator
SD Cooper Company
in Huntington Beach CA

Senior Benefits Advisor
Employee Benefits Security Administration, U.S. Department of Labor
in Atlanta GA / Telecommute

Senior Benefits Advisor
Employee Benefits Security Administration, U.S. Department of Labor
in Plantation FL / Telecommute

Health Insurance Specialist
Centers for Medicare & Medicaid Services, U.S. Department of Health and Human Services
in Bethesda MD / Telecommute

Director of Technical Education and Communications
Ascensus
in Dresher PA / Brainerd MN / Tucson AZ / Madison WI

General Attorney-EXC
Pension Benefit Guaranty Corporation
in Washington DC / Telecommute

Health Insurance Specialist (Program Integrity)
Centers for Medicare & Medicaid Services, U.S. Department of Health and Human Services
in Woodlawn MD / Telecommute

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Webcasts, Conferences

Form 5500 Updates / An Update on What's Happening in Retirement
May 22, 2019 in PA
ASPPA Benefits Council [ABC] of Western PA

Understanding Fiduciary Duty: Hiring a Service Provider
May 22, 2019 WEBCAST
Multnomah Group

Capital Forum on Pensions
June 5, 2019 in CA
Western Pension & Benefits Council - Sacramento Chapter

►See 168 Upcoming Webcasts and Conferences

►See 1519 Recorded Webcasts


Discussions

New Topics on the BenefitsLink Message Boards

New Comments and Topics

All Topics, Grouped by Forum


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[Official Guidance]

Text of IRS Final Regs: User Fees Relating to Enrolled Agents and Enrolled Retirement Plan Agents

"[These] final regulations remove the initial enrollment user fee for enrolled retirement plan agents because the IRS no longer offers initial enrollment as an enrolled retirement plan agent. The final regulations also increase the amount of the renewal user fee for enrolled retirement plan agents from $30 to $67. In addition, the final regulations increase the amount of both the enrollment and renewal user fee for enrolled agents from $30 to $67."
Internal Revenue Service [IRS]

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Editor's Pick De-Risking Pitfalls: Annuity Contracts, Plan Terminations and the Excise Tax on Surplus Assets (PDF)

"Various factors -- the timing between the funding of the annuity purchase and the purchase itself ... the quality of plan data ... or the discovery of additional liabilities or plan assets -- can influence the annuity contract purchase price. To the extent assets remain in a plan following the purchase of an annuity, recovering those amounts can be costly -- and may not even be possible -- unless the sponsor can show the amounts were contributed due to an erroneous actuarial computation or mistake of fact."
Groom Law Group, via Bloomberg Tax Management Compensation Planning Journal

Participants Failed to Show That Fund Manager's Discretion Made It a Fiduciary

"Common sense suggests that having little advance notice of changes in a fund's credited rate and no comparable investment alternative might diminish participants' freedom to 'veto' rate changes by withdrawing from the fund.... [W]hile it might be tempting to read this case as a determination that investment limitations ... don't grant sufficient discretionary authority to make an investment manager a fiduciary, that wasn't the court's conclusion." [Teets v. Great-West Life & Annuity Ins. Co., No. 18-1019 (10th Cir. Mar. 27, 2019)]
Thomson Reuters / EBIA

Third Circuit Resuscitates Claims Against University 403(b) Plan Fiduciaries

"The Third Circuit ... rejected the University's argument that the Court's earlier decision in Renfro v. Unisys Corp.... insulated plan fiduciaries from liability for a breach of fiduciary duty where plans offer a mix and range of investment options, because such a ruling would allow a fiduciary to avoid liability by stocking a plan with hundreds of options even if the majority were overpriced or underperforming. Furthermore, it would hinder courts from evaluating fiduciaries' performance against contemporary industry practices because practices change over time and ERISA fiduciaries have a duty to act prudently according to current practices." [Sweda v. Univ. of Penn., No. 17-3244 (3d Cir. May 2, 2019)]
Proskauer

Will Financial Companies Start Funding Plaintiffs' ERISA Lawsuits? Or Are They Already?

"For a cut of the potential winnings, there are financial companies willing to put up capital to pay for some or all of the cost of private litigation ... [P]erhaps the most likely area in which litigation financing could be playing an undisclosed role in the ERISA domain would be a case where a firm ... is providing financial resources to the attorneys representing classes of participant-plaintiffs, rather than providing such support directly to the lead plaintiffs."
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Who Are the Best 401(k) Providers for Your Small Business?

"A new breed of small business 401(k) providers has emerged, using technology to offer easy-to-use, low-cost 401(k)s. Focused on the unique needs of the small business market, these 401(k) providers strive to make high-quality, low-cost retirement plans accessible to all -- not just Fortune 500 companies."
ForUsAll

Ensuring Retirement Security with Simple 'GLIDeS'

"A new bond (SeLFIES) has been proposed as the safe asset for the goal of retirement income. This paper ... [1] tests a simple rule [called] GLIDeS: Goal-based, Lifetime Income-focused, Dynamic Strategy that allocates between Equities and SeLFIES based on a retirement income goal; [2] shows how GLIDeS could dominate standard portfolio choices ... [3] introduces a new way to think about intermediate retirement targets to ensure one is on a safe path to retirement; and [4] explores implications for level of savings required to achieve a retirement goal."
Arun Muralidhar and Adam Kobor, via SSRN

Evaluating the Changed Collection of Equity Mutual Funds for Vanguard Participants in the Duke University Retirement Plan

"[The authors] compare the new lineup of funds with the Vanguard funds that have been cut from the retirement plan.... [T]he new plan contains funds which on average have outreturned their benchmarks by more than the Vanguard funds that have been cut. [The authors] also characterize the styles of the funds in the new lineup to help the construction of balanced portfolios."
Chong Li, Edward Tower, and Rhona Zhang, via SSRN

OIG Report on Internal Control Related to the PBGC's Fiscal Year 2017 and 2016 Financial Statements Audit

"PBGC strengthened its control environment by implementing management practices to mitigate control deficiencies reported in previous years. Further, management improved its current business processes to address specific financial reporting and information technology control deficiencies. However, management should continue to focus its efforts to resolve outstanding conditions."
Office of Inspector General, Pension Benefit Guaranty Corporation [PBGC]

Selected Discussions
on the BenefitsLink Message Boards

Owner Has Low Pay But Wants Higher Contributions

Thinking about plan design. Employer has one owner, 40's, minimizes pay. Would like to start up new plan and willing to increase pay to self to allow for contributions. 401k, safe harbor are fine. But this approach does not mesh well with cross-tested design because ratios are too high to pass. Pay too low for integrated formula to function too. Thinking about other design considerations.
BenefitsLink Message Boards

Top Hat Filing for Phantom Stock Plans

We have a Phantom Stock plan. It's essentially deferred compensation but it doesn't specifically limit participation to a Top Hat group. Do we need to do a top hat filing? If not, do we need to comply with ERISA rules? To make things a bit more complicated, how do we handle omnibus equity plans? They offer some types of awards that are exempt from 409A, such as stock options, but they also allow for phantom stock, which is deferred compensation. Do we need to do a Top Hat filing for an omnibus plan? And, again, how does it factor in that participation is not limited to a top hat group? If not a Top Hat filing, is there something else?
BenefitsLink Message Boards

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Press Releases

Most Popular Items in the Previous Issue

Independent Contractor vs. Employee -- The Tug of War Continues
The Modern Workplace, by Gray Plant Moody

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2019 BenefitsLink.com, 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 BenefitsLink.com, 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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