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[Official Guidance]

Text of PBGC Final Regs: Allocation of Assets in Single-Employer Plans; Valuation of Benefits and Assets; Expected Retirement Age

"This rule amends the [PBGC's] regulation on Allocation of Assets in Single-Employer Plans by substituting a new table for determining expected retirement ages for participants in pension plans undergoing distress or involuntary termination with valuation dates falling in 2020. This table is needed to compute the value of early retirement benefits and, thus, the total value of benefits under a plan.... This rule is effective January 1, 2020."

Pension Benefit Guaranty Corporation [PBGC]


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What You Don't Know, Can Hurt You: ERISA's Statute of Limitations Conundrum (PDF)

"Is it actual knowledge of the underlying facts supporting a claim? Or is it not only the knowledge of these underlying facts, but in addition the understanding that there is a legally viable claim? Furthermore, the Court may rule on what responsibilities a plan participant has in terms of reading and understanding mandated disclosures." [Sulyma v. Intel Corp. Investment Policy Comm., No. 17-15864 (9th Cir. Nov. 28, 2018; cert. pet. granted June 10, 2019; oral arg. Dec. 4, 2019)]

Jose Jara and Anthony Fassano of Archer & Greiner P.C., via Tax Management Compensation Planning Journal

Who Owns a 401(k) Participant's Personal Information?

"At least one district court has concluded that the personal information of retirement plan participants is not a plan asset because it is not 'property the plan could sell or lease' ... But there is a thriving commercial market for personal information and it is bought and sold for marketing purposes every day (think Google here). So, should retirement plan fiduciaries act to protect the personal information of plan participants while the courts sort this out?"

The Retirement Plan Blog

No Uptick in 401(k) Hardship Withdrawals Seen in Wake of Final Regs

"Of the 145 plan sponsors surveyed, 64.6% adopted the new hardship provisions, and of those, 72.6% reported no changes in the level of hardship withdrawals in 2019 with only 17.8% reporting an uptick[.]"

Pensions & Investments

Severstal Wheeling Case Provides Guidance for Retirement Committee Members

"The guidance from the WPN court is essentially a roadmap that can assist an Appointing Fiduciary in satisfying its duty to monitor the investment fiduciaries that it has appointed." [Scalia v. WPN Corp., Ronald LaBow, Severstal Wheeling Retirement Committee, et al., No. 14-1494 (W.D. Pa. Sept. 30, 2019)]

Epstein Becker Green

First Circuit Overturns the Sun Capital, But Risks Remain for Private Equity

"[P]rivate equity funds that do have a controlling interest in a portfolio company with defined benefit plan liabilities or multiemployer plan withdrawal liability should not rely on the notion that such funds are not engaged in a trade or business to insulate them from joint and several liability." [Sun Capital Partners III, LP v. New England Teamsters & Trucking Industry Pension Fund, Nos. 16-1376, 19-1002 (1st Cir. Nov. 22, 2019)]

McDermott Will & Emery

Senate Republicans Release Proposal for Multiemployer Pension Reform

"In addition to addressing failing plans, the Proposal contains a series of measures that are intended to ensure that additional crises do not occur in the future. The scope of these measures is extremely broad, and they would affect nearly all aspects of multiemployer plan funding, administration, and governance.... [T]he Proposal is likely to have a significant influence on the process going forward."

Groom Law Group

Law Firm's Mandatory Age 70 Retirement Policy Was Enforceable, Says Eighth Circuit

"In 2003, the United States Supreme Court established a six-factor test ... to determine whether an individual is likely an owner or an employee.... Not all partners in every firm are created equally, and firms with multitiered partnership levels should tread carefully. Most non-equity partners -- and even some equity partners, those with little or no management authority, and few voting rights -- potentially could be considered employees under the ADEA." [Von Kaenel v. Armstrong Teasdale, LLP, No. 18-2850 (8th Cir. Dec. 3, 2019)]

Hinshaw & Culbertson LLP


My Day at the Supreme Court: Thoughts on the Intel Oral Argument

"Many of the justices on the Court seemed to think that just sending a link in an email is not enough. Justice Brett Kavanaugh said, 'many people don't read them,' and Justice Ruth Bader Ginsberg even admitted to not reading every document she receives about her own investments.... Many of the questions ... highlighted the [Pension Rights Center's concerns] with this proposed 'notice and access' rule that would allow plans to simply send individuals emails telling them that they could find critical retirement plan information on a website."

Emily Gilbert, Pension Rights Center

Selected Discussions
on the BenefitsLink Message Boards

Death of Alternate Payee During Processing of Proposed QDRO

"A couple's divorce was final on July 16, 2019. I am retained in August by the attorneys to draft QDROs for two plans. All parties approve the drafts by late September, which are are submitted on October 9 to the plan administrator/sponsor for pre-approval. Sadly, the proposed alternate payee dies on November 26. Signature pages had been signed by both the participant and alternate payee when they approved the drafts in September, before submission to the plan administrator. The alternate payee did not have a beneficiary form on file, of course. Does anyone have advice/thought in this situation?"

BenefitsLink Message Boards

Tax-Exempt 457(b) Plan -- Commencement of Distributions

"Per the 457(b) plan document, a terminated participant needs to make a distribution election within 60 days following termination of employment; further, distributions can commence on or after the 61st day. The participant can choose lump sum or installments (annual, up to 3 years). Separately, they can choose to take the distribution as soon as administratively feasible or can delay payment until a specific date. I understand that they can change this election ONE time prior to the distribution commencement date. Can they choose any prospective date for the commencement of the distribution, i.e., can it be 10 years from now?"

BenefitsLink Message Boards

Vendor Made Non-Required 'RMD' and Won't Take It Back

"80-year-old participant, still active and employed -- rolled over to an IRA in 2019 (an in-service withdrawal). Retirement/termination date will be Jan. 1, 2020. The 401k vendor automatically sent out an RMD even though the participant is active and will not terminate until next year. What can be done with this RMD? Vendor will not take the money back. Can it rolled into an IRA within 60 days? What about the tax that was withheld?"

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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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