Retirement Plans Newsletter

January 2, 2020

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Southern Pension Services
Tampa FL

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Sheet Metal Workers' National Pension Fund
Fairfax VA

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Independent Retirement
Portland OR / Telecommute

View job as Pension Analyst Pension Analyst  View details

Metro Benefits Inc.
Pittsburgh PA

View job as Retirement Plan Administrator Retirement Plan Administrator  View details

BKD
Little Rock AR

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2019 Annual Report of the PBGC Participant and Plan Sponsor Advocate (PDF)

25 pages. "The Office of the Advocate is currently pursuing a Pension Plan Registry project which would provide a tracing service so participants and plan sponsors can track what happened to a pension plan." [Other topics: statutory authorization, participant issues, plan sponsor issues, and multiemployer pension issues.]

Pension Benefit Guaranty Corporation [PBGC]

Second Circuit Holds Reformation of Pension Plan Is Equitable Remedy Even Absent Traditional Fraud or Mutual Mistake

"In a matter of first impression, the Second Circuit considered whether reformation is an available remedy where a pension plan's written terms violate ERISA, but there is no allegation that the violation is a result of traditional fraud, mistake, or other inequitable conduct.... [T]he Second Circuit held that reformation is available in this circumstance under ERISA Section 502(a)(3) and that the district court is authorized to enforce the reformed Plan as a second step under ERISA Section 502(a)(1)(B)." [Laurent v. PricewaterhouseCoopers LLP, No. 18-487 (2d Cir. Dec. 23, 2019)]

Kantor & Kantor

ERISA Class Action Complaint Targets Ardent Health Services Over Investment Fees

"The complaint alleges that [fiduciaries of] the nearly $1 billion [plan] have failed to objectively and adequately review the plan's investment portfolio with due care to ensure that each investment option was prudent in terms of cost and performance.... Other allegations include that plan fiduciaries permitted overpayments for recordkeeping and administrative services." [McCool v. Ardent Health Serv., LLC, No. 19-1158 (M.D. Tenn. complaint filed Dec. 24, 2019)]

PLANSPONSOR; free registration may be required

ERISA Class Claims Shifted to Defined Benefit Plans in 2019

"[S]ponsors of defined benefit plans should be wary of adding mandatory arbitration provisions to their plan documents.... [A]n individual participant's arbitration proceeding alleging a fiduciary breach ... could affect the entire plan even in the absence of a class action -- fiduciaries would be subject to the mostly unappealable decision of an arbitrator without the benefit of the more limited exposure otherwise available with individual arbitration."

Pillsbury Winthrop Shaw Pittman LLP via Mondaq

How to Encourage Millennials to Participate in Your Retirement Plan

"Given this generation’s anxieties and struggles surrounding retirement savings, employers designing retirement plans with the specific needs of millennials in mind can distinguish themselves while truly impacting the financial lives of current and future employees. By incorporating loan repayment plans, financial wellness resources, and professional advice into a holistic retirement plan benefit, plan sponsors can help millennial employees navigate current difficulties so they can begin setting aside appropriate amounts for retirement."

PlanPILOT

Despite Strong Investment Gains, Financial Health of Largest U.S. Corporate Pension Plans Showed Little Improvement in 2019

"[F]or 376 Fortune 1000 companies that sponsor U.S. defined benefit pension plans and have a December fiscal-year-end date ... aggregate pension funded status is estimated to be 87% at the end of 2019, compared with 86% at the end of 2018.... [T]he pension deficit is projected to be $216 billion at the end of 2019, slightly lower than the $222 billion deficit at the end of 2018. Pension obligations increased 9% from $1.58 trillion in 2018 to an estimated $1.72 trillion in 2019."

Willis Towers Watson

December 2019 Pension Finance Update

"2019 was the best of times, then the worst of times, then the best of times again for pension finance. Overall assessment: meh. During December, both model plans ... gained ground for the fourth consecutive month: Plan A improved 2% and finished 2019 even, while Plan B gained less than 1%, ending 2019 up less than 1%."

October Three Consulting

FAS87 ASC715 Discount Rates and Moody's Rates, December 31, 2019

An unofficial monthly report of the Moody's Daily Long-term Corporate Bond Yield Averages and Moody's Daily Treasury Yield Averages (used as benchmarks by some corporate pension plans).

David Rigby, via BenefitsLink Message Boards

Benefits in General

Brain Scientists Tap Into the Secrets of Living Well Longer: Extending 'Healthspan'

" 'Healthspan,' a coinage now gaining traction, refers to the years that a person can expect to live in generally good health -- free of chronic illnesses and cognitive decline that can emerge near life's end. Although there's only so much a person can do to delay the onset of disease, there's plenty that scientists are learning to improve your chances of a better healthspan."

Kaiser Health News

Selected Discussions
on the BenefitsLink Message Boards

Employer Won't Let Me Contribute As Much As I'd Like to My 401(k)

"When I initially joined my employer's 401K three years ago, I elected to contribute 30% of my pay. This would put me near the maximum dollar amount allowed. My employer will only deduct 20% of my pay for my 401K . I did some research and found that they are allowed to do this. Apparently there is a rule to keep a few employees from contributing way more than the rest of the employees. So I am contributing $15k a year. My age allows me to contribute up to $25k. What can I do to make up for this shortfall? I already max out my IRA contribution."

BenefitsLink Message Boards

Removing an Extended Payment Option for Surviving Spouses: Anti-Cutback Violation?

"A defined contribution plan currently provides that death benefits must be paid out over 5 years generally, but allows for extended payments to a participant's spouse. The client wants to remove extended payments and apply the 5 year rule to all beneficiaries, including the spouse. The plan does not allow annuity distributions. Are the extended payments protected or may they be eliminated as an optional form of benefit?"

BenefitsLink Message Boards

Electronic Filing of 1099-R Forms

"I have a TCC for the IRS FIRE site and file the 8955-SSAs for our clients after they review them. Can I use the same TCC to file the 1099-R forms for the few that we do? I wasn't sure if that same TCC code will work or if I have to prepare a 4419 and get a different TCC to file the 1099-R forms. Still have some small balance forward plans and have been preparing paper forms."

BenefitsLink Message Boards

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2020 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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