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January 22, 2020 logo logo
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Employee Benefits Security Administration [EBSA]
Kansas City MO

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Webcasts, Conferences

Reg BI Cometh!

Retirement Plan Alternatives for Small Plan Sponsors: Calsavers, Private Qualified Plans, Ira-Based Plans
February 12, 2020 in CA
Western Pension & Benefits Council - Orange County Chapter

A Deep Dive on RMDs
February 25, 2020 WEBCAST
Western Pension & Benefits Council

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[Official Guidance]

Text of Treasury Department Notice of Local 807 Labor-Management Pension Plan Second Application to Reduce Benefits

"The Board of Trustees of the Local 807 Labor-Management Pension Plan ... has submitted an application to reduce benefits under the plan in accordance with [MPRA] ... The purpose of this notice is to announce that the application submitted by the Board of Trustees of the Fund has been published on the website of the Department of the Treasury, and to request public comments on the application from interested parties[.]"

U.S. Department of the Treasury

[Official Guidance]

Text of 2019 IRS Publication 721: Tax Guide to U.S. Civil Service Retirement Benefits (PDF)

33 pages. "This publication explains how the federal income tax rules apply to civil service retirement benefits received by re- tired federal employees (including those disabled) or their survivors. These benefits are paid primarily under the Civil Service Retirement System (CSRS) or the Federal Employees' Retirement System (FERS)."

Internal Revenue Service [IRS]

[Guidance Overview]

Details of the SECURE Act: Withdrawals for Birth or Adoption

"[T]he aggregate amount which can be treated as 'qualified' with respect to any birth or adoption cannot exceed $5,000. This limit applies to all plans maintained by the employer or any member of a controlled group of employers. Employers with multiple plans will need to make sure that an employee is not allowed to exceed the $5,000 limit by withdrawing from more than one plan. This limit is for each individual, so it would be possible for each spouse to request a $5,000 distribution from his/her respective plan or IRA for each birth or adoption."

Retirement Management Services, LLC

[Guidance Overview]

Deadline for 403(b) Plan Corrections is March 31

"[It] is critical that the plan document and the plan's actual operation are consistent with one another and with the Internal Revenue Code. It is also very important to ensure the terms of the restated 403(b) plan accurately reflect the terms of the collective bargaining agreements, administrator contracts, handbooks, or other employee agreements.... Schools that miss the March 31, 2020, self-correction deadline for their 403(b) plans will generally only be able to correct past plan document failures by filing the plan with the IRS and paying a fee."

Ice Miller LLP

[Guidance Overview]

Puerto Rico Plan Limits for 2020 Largely Track U.S. Plan Limits

"[T]he PR Code incorporates many of the applicable limits under the U.S. Code by reference. Employers maintaining Puerto Rico-only plans and dual-qualified plans (i.e., a plan that qualifies under both the PR Code and the US Code) will need to make the necessary adjustments to the plans' administrative/operational procedures and notices with respect to Puerto Rico participants."


[Guidance Overview]

Editor's Pick Coordinating QCDs With Post 70-1/2 IRA Contributions

"With the passage of the SECURE Act, ... IRA Account owners must now reduce their intended [Qualified Charitable Contributions (QCDs)] by any contribution amounts made into their IRAs after age 70-1/2 (the age cap in place to make IRA contributions before passage of the SECURE Act), to the extent they have not already been used to reduce their QCD. In other words, IRA contributions made after age 70-1/2 cannot be turned around to be used as QCDs… and the rules effectively require a 'LIFO' treatment that ensures post-age 70-1/2 contributions will first and foremost be used to reduce future QCDs."

Nerd's Eye View

[Guidance Overview]

Editor's Pick IRS Publication 3998: Choosing a Retirement Plan for Your Small Business (PDF)

Rev. Nov. 2019. "Small businesses may choose to offer IRAs, defined contribution plans, or defined benefit plans. Many financial institutions and retirement plan practitioners make available one or more of these retirement plans that have been pre-approved by the IRS. [This publication includes] a chart outlining the advantages of each of the most popular types of IRA-based and defined contribution plans and an overview of a defined benefit plan."

Internal Revenue Service [IRS]; Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

Estate Planning for Retirement Benefits After the SECURE Act

"For over 30 years, the go-to estate plan for owners of tax-favored retirement plans has been the 'stretch' IRA.... SECURE changes the payout period for most beneficiaries to the ten-year payout. Even pre-2020 deaths are not spared by SECURE. They receive only a partial exemption from the ten-year payout rule."


RMDs 2020: To Infinity and Beyond!

"While not related to SECURE, note that the life expectancy tables used to calculate the RMDs have changed. The revised life expectancies are longer; therefore, the amounts participants and beneficiaries are required to receive, as RMDs will be lower. This change will not go into effect until 2021 at the earliest and is likely to result in a lower tax liability for RMD recipients[.]"

Milliman Retirement Town Hall

How to Stay Prepared for DOL Audits

"[1] Understand [these] key provisions of the plan document ... [2] Make certain that plan amendments and fee disclosures are timely made ... [3] Understand annual compliance testing requirements ... [4] Double-check distributions from the plan ... [5] Evaluate hardships ... [6] Inspect the plan fees ... [7] Provide timely contribution and loan repayment remittance."

Meaden & Moore

Paper or Online? Retirement Plan Participants Can't Decide

"[T]here is no consensus among consumers for any specific format (paper only, electronic only or both). Four in 10 say they prefer to receive communications from their retirement plan providers electronically through email or an online portal. One quarter prefer to receive paper copies and 32% want to receive communications from their retirement plan provider both electronically and in hard copy."

Tips for Accurate ESOP Census Reporting

"Compiling accurate ESOP census data is critical to the plan. The underlying census data drives eligibility, vesting, and various allocations of the plan assets. [Here are] a few helpful hints to improve accuracy of the data[.]"

Meaden & Moore

401(k) Testing Deadlines Employers Should Know

"[This article provides] a summary of the nondiscrimination tests that may apply to your 401(k) plan, including their correction deadlines. Safe harbor 401(k) plans are usually exempt from the ADP/ACP and top heavy tests. Following the close of each plan year, most 401(k) providers will prioritize the testing of 401(k) plans subject to the ADP/ACP test first due to the early deadline for correcting a failed test without penalty."

Employee Fiduciary

Benefits in General

Call for Entries: Employee Benefits Law Simplification Award

"The American College of Employee Benefits Counsel hereby invites academics, practitioners, and any other individuals interested in the employee benefits system to submit proposals to simplify employee benefits law. A $10,000 prize for the winning submission will be awarded ... [E]ach proposal should include [a detailed analysis] that: [1] Thoroughly details the simplification that will result from the proposal and the benefits of that simplification.... [2] Explains how the proposal either enhances or, at the least, has no material adverse impact on employee/participant rights; and [3] Identifies and analyzes other ancillary advantages or benefits and any policy tradeoffs.... The Simplification Award Template ... provides comprehensive guidance on the format of a submission.... Submissions for the Third Annual ACEBC Simplification Award must be received no later than Midnight, Eastern Time on May 1, 2020."

American College of Employee Benefits Counsel

Editor's Pick Common Law Marriage and Employee Benefits

"Given the challenges associated with common law marriage, here are some best practices for employers to consider: [1] Determine if you have employees in states that allow common law marriage.... [2] Consider whether qualifying events that result in a person adding or dropping a spouse should require evidence (and what evidence is required). [3] Include the evidence requirement in the applicable plan language.... [4] Apply the evidence requirement consistently with all impacted employees."

HUB International

Selected Discussions
on the BenefitsLink Message Boards

Limitations on PTE 80-26 Loans -- Do They Exist?

"Quite a few years ago the rules were changed by getting rid of the 3-day rule regarding the length of some 80-26 loans, but I haven't been able to find guidance regarding how long such a loan can remain unpaid. Seemingly absent is anything addressing the amount of the loan in relation to the amount of ongoing expenses. How are such loans are typically handled, especially since loans lasting over 60 days must be in writing? Also, I'm not sure how to word the promissory note."

BenefitsLink Message Boards

Repayment of 401(k) Loan Spoils Eligibility for Deductible IRA Contribution?

"A large payroll company marked Box 13 with an X for a 401(k) participant who had made no elective deferrals to the plan. The participant's account received no employer contribution for 2019. There is no DB plan. The employee wanted to make the maximum possible deductible contribution to his IRA. The employer specifically told the payroll company, "No X for this person." But the payroll company said that, because there were 401(k) loan repayments, they had to mark Box 13 with an X for this person. Wasn't that wrong?"

BenefitsLink Message Boards

Per-Year Plan Audits Needed for Non-Filing of Form 5500, or Just One for Period of Non-Filing?

"We had a large plan client that stopped communicating with us and stopped filing 5500s several years ago. Now they have contacted us to bring the plan up to date. This will mean DFVC filing for 7 years (thru 2019) -- all large plan 5500. Do they need a separate audit for each year or can they use one comprehensive audit for 01/01/13 through 12/31/19?"

BenefitsLink Message Boards

Plan Sponsor Changes Name and Plan Name Mid-Year

"Plan Sponsor changes name and plan name in middle of the year. What name should be used on 1099R forms and 1096 forms? Old name or new name?"

BenefitsLink Message Boards

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Press Releases

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Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2020, 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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