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February 14, 2020 logo logo
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[Official Guidance]

Text of SEC FAQs on Regulation Best Interest

21 Q&As. Topics: [1] Retail Customer; [2] Recommendation; [3] Disclosure Obligation; [4] Care Obligation; [5] Conflict of Interest Obligation; [6] Compliance Obligation.

U.S. Securities and Exchange Commission [SEC]

[Official Guidance]

Text of FRTIB Proposed Regs: Hardship Withdrawals for Expenses Related to Natural Disasters

"Because the [Thrift Savings Plan (TSP)] has relied on the IRS' disaster relief announcements to authorize hardship withdrawals for expenses and lost income relating to natural disasters, and because those announcements will no longer be made by the IRS in light of its amended regulation, the FRTIB proposes to add to its list of authorized hardship expenses, the expenses and losses (including loss of income) resulting from a natural disaster as declared by the FEMA in order to allow TSP participants to make financial hardship withdrawals for such natural disaster expenses."

Federal Retirement Thrift Savings Board [FRTIC]

[Guidance Overview]

Editor's Pick Section 403(b) Plan Remedial Amendment Periods: Out with the Old, in with the New

"[Rev. Proc. 2019-39] established a system of recurring 'Remedial Amendment Periods' to correct defects in the form of individually designed and preapproved 403(b) plan documents that occur after March 31, 2020.... [E]mployers should be aware of the corresponding March 31 deadline to adopt corrective amendments or a preapproved plan to ensure the compliance of 403(b) plan documents retroactive to January 1, 2010."

Morgan Lewis

[Guidance Overview]

The SECURE Act: Know the Mandatory Provisions Affecting Retirement Plans and IRAs

"[1] Covering part-time workers ... [2] Safe harbor notices ... [3] Lifetime income disclosure ... [4] Plan loans using credit cards ... [5] Closed defined benefit plans ... [6] Stretch IRAs eliminated ... [7] Late fees for Form 5500 and other retirement plan returns."

McDonald Hopkins

[Guidance Overview]

The SEC Trading and Markets Reg BI FAQ and the SEC's and FINRA's Plans for Reg BI Exams

"While much of the coverage of Reg BI has been historical and focused on analyzing and summarizing the final rule package, this alert looks to the future regarding how the Division of Trading and Markets, OCIE and FINRA are interpreting and planning to examine for Reg BI compliance. The Reg BI FAQ provides helpful guidance to the brokerage industry. Unlike the first Form CRS FAQ released last fall, which was very brief, the Reg BI FAQ provides specific guidance on a variety of important topics covered by Reg BI, specifically recommendations, the disclosure obligation, the care obligation and the conflict of interest obligation."

Faegre Drinker

The SECURE Act: A World of Opportunities for Annuity Carriers

"In the third quarter of 2019 ... $5.9 trillion was held in 401(k) plans, $1.1 trillion in 403(b) plans, and $342 billion in 457 plans.... All have been explicitly modified by the recently enacted [SECURE] Act. Offering annuities in retirement plans may now be more attractive for consumers, plan sponsors, and annuity writers. This article looks at key changes and opportunities."


NAIC Finalizes 'Best Interest' Annuity Sales Model Law

"The model articulates a best-interest standard through the following four obligations: care, disclosure, conflict of interest and documentation.... The rule specifically does not establish a fiduciary duty, nor does it ban agents from recommending products with a higher compensation structure."

The 2019 Current Population Survey: New Questions, Improved Results? (PDF)

"Since a 2014 redesign, the Current Population Survey (CPS) retirement plan participation estimates have been much lower and trended downward, contradicting other data sources. New questions added in 2019 on income in retirement accounts give hope for a better and more accurate read on employment-based retirement plan participation."

Employee Benefit Research Institute [EBRI]

McClatchy Files for Chapter 11 Protection While PBGC Talks Continue

"McClatchy disclosed in November that it was discussing having the PBGC take over its qualified defined benefit plan that was closed to new participants in 2009.... As of March 31, the plan was underfunded by $535 million. McClatchy will seek court permission to terminate the pension plan, transferring responsibility to the PBGC. The company has proposed settling its pension liabilities by paying PBGC $3.3 million annually for 10 years and giving it 3% of equity ownership."

Pensions & Investments

$2.6 Million for Puerto Rico's Pension Fund Went to Hackers Instead

"[A] senior official told the police on Wednesday that the island's government had unwittingly handed over $2.6 million to thieves after being fooled by a bogus email message.... Rubén Rivera, the finance director of the government-sponsored Puerto Rico Industrial Development Company, said ... that the email message contained instructions to transfer money intended for the public pension system to a different bank account than had been used before.... Whose bank account that was, and what happened to the money, is under investigation."

The New York Times; subscription may be required

Benefits in General

Emergency-Fund-Focused Employers: Goals, Motivations, and Challenges

"More than 4 in 10 employers that expressed at least some interest in offering financial wellness programs said they offer (28.2 percent) or plan to offer (15.3 percent) an emergency fund/employee hardship assistance as a financial wellness initiative.... Emergency-fund-focused employers were more likely than all employer respondents to favor education-based financial wellbeing or debt assistance benefits to employees over product-based benefits, which might include insurance, retirement plans, or employee assistance programs[.]"

Employee Benefit Research Institute [EBRI]

Selected Discussions
on the BenefitsLink Message Boards

Amending 401(k) to Safe Harbor Non-Elective Mid-Year 2020

"Client has a 401(k) that does a discretionary match. They have matched for January and part of February of 2020 already. They failed ADP for 2019 so want to do a Safe harbor going forward. Under the SECURE Act, can they amend now to do the 3% Non-elective for the remainder of the year (as of the date of adoption of the SH plan)? If so, do they perform ADP test for the months they had the normal match or do they pass for 2020?"

BenefitsLink Message Boards

Effect of Vesting Schedule Change on Entry Date for New Employee

"I have a plan that amended the vesting schedule effective 1/1/2018 from immediate vesting to a 2/20 vesting schedule. An employee was hired 9/2017. She was eligible 1/1/2019 (1 year 1000 hour eligibility with 1/1 & 7/1 entry). Does she fall under the old vesting schedule because of her hire date, or does she fall under the new because of her participation date?"

BenefitsLink Message Boards

Ownership by Father-in-Law is Attributed to Son-in-Law for HCE Determination?

"Does the son-in-law of the owner get attributed the ownership percentage of father in law? I have daughter as HCE based on Dad's ownership."

BenefitsLink Message Boards

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Press Releases

Upcoming Events About Retirement Plans or Executive Compensation

Feb. 18
SECURE Act: What Plan Sponsors Need to Know
Williams Mullen
Feb. 19
Sizing Up The SECURE Act
Ogletree Deakins
Fee is required
Feb. 20
Basics of Qualified Retirement Plans: Session 3
Fee is required
Feb. 20
Voluntary Fiduciary Correction Program
Employee Benefits Security Administration [EBSA], U.S. Department of Labor
Feb. 20
Answering the SECURE Act Insecurities
Feb. 20
Step 4 of the Fiduciary Process: Monitoring the Client Engagement
Feb. 20
Is Your Plan Data Secure? Best Practices for 2020
Worldwide Employee Benefits Network [WEB] - New York Chapter
Fee is required

Most Popular Items in the Previous Issue, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

Article submission: Online form, or email to

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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