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Webcasts, Conferences

Use PEPs to Leverage the Change Energies of the U.S. Retirement System
July 1, 2020 WEBCAST

NIPA Annual Forum & Expo Amplified
August 10, 2020 WEBCAST
NIPA [National Institute of Pension Administrators]

401(k) Hot Topics
August 26, 2020 WEBCAST
American Society of Pension Professionals & Actuaries [ASPPA]

IRA Essentials Workshop
September 22, 2020 WEBCAST
League of Southeastern Credit Unions [LSCU]

IRA Advanced Workshop
September 23, 2020 WEBCAST
League of Southeastern Credit Unions [LSCU]

IRA Essentials and Advanced IRAs Workshops
October 1, 2020 WEBCAST

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View COVID-19 News and Resources

[Official Guidance]

Text of IRS Notice 2020-51: Guidance on Waiver of 2020 Required Minimum Distributions (PDF)

"This notice provides guidance relating to the waiver of 2020 required minimum distributions ... from certain retirement plans under section 2203 of the [CARES Act]. In particular, the notice: [1] permits rollovers of waived required minimum distributions (RMDs) and certain related payments, including an extension of the 60-day rollover period for certain distributions to August 31, 2020; [2] answers questions relating to the waiver of 2020 RMDs; and [3] provides a sample plan amendment that, if adopted, would provide participants a choice whether to receive waived RMDs and certain related payments. The notice also provides transition relief for plan administrators and payors in connection with the change in required beginning date for RMDs under Section 401(a)(9) of the Code pursuant to section 114 of the [SECURE Act]."

Internal Revenue Service [IRS]

[Official Guidance]

IRS Extends July 15, Other Upcoming Deadlines for Tornado Victims in Parts of the South; Provides Other Relief

"Victims of the April tornadoes, severe storms and flooding that took place in parts of Mississippi, Tennessee and South Carolina will have until October 15, 2020, to file various individual and business tax returns and make tax payments ... [A]ffected individuals and businesses will have until October 15, 2020, to file returns and pay any taxes that were originally due during this period. This includes 2019 individual and business returns that, due to COVID-19, were due on July 15. Among other things, this also means that affected taxpayers will have until October 15 to make 2019 IRA contributions."

Internal Revenue Service [IRS]

[Official Guidance]

Text of Puerto Rico Internal Revenue Circular Letter No. 20-29: Special Distributions from Qualified Retirement Plans and Individual Retirement Accounts Due to a Disaster Declared by the Governor of Puerto Rico

"[T]he Department deems it necessary to extend the Eligible Period established in CC RI 20-09 to grant an additional period of time for individuals to access retirement funds and IRA accounts to the extent that their economic conditions so require.... Therefore, CC RI 20-09 and CC RI 20-23 are amended to establish that the Eligible Period to make Special Disaster Distributions will be in effect until Thursday, December 31, 2020.' [Unofficial English translation (via Google Translate)]

Puerto Rico Departamento De Hacienda

[Guidance Overview]

What Happens to Participants' COVID-Related Distributions If the Plan Sponsor Chooses Not to Treat Them as Such?

"IRS and Treasury have taken the position that an employer can choose to whether or not offer CRD distributions from the plan.... It does not appear that the participant has to file a CRD certification with the plan administrator to get this favorable tax treatment, they just have to be able to prove they meet the (newly expanded, thank you!) CRD standards.... The employer does not have to extend the loan limits under the CRD rules, and the IRS has taken the position that the employer does not have to suspend the requirements that loan payments still be made ... [Notice 2020-50] does not specifically address this issue of what happens when an employer fails to suspend, given the mandatory nature of the law."

Business of Benefits

[Guidance Overview]

IRS Releases Anticipated Expanded Guidance on Retirement Plan Provisions of the CARES Act

"This expanded list of individuals whose circumstances can qualify them for access to CARES Act enhanced distributions and loans correlates more closely with how many participants may have already been assuming the rules worked. Given that plan administrators can rely on an individual's certification that the individual is a qualified individual (and the IRS has now made available a sample certification in Notice 2020-50), this expanded list of qualified individuals will help align the law with practical expectations."

Michael Best

[Guidance Overview]

Additional Clarity for Employers and Retirement Plan Administrators on Coronavirus Relief Under the CARES Act

"[Notice 2020-50] clarifies that: [1] The Coronavirus distributions do not need to be withdrawn solely to meet a need arising from COVID-19; [2] The Coronavirus distributions are permitted without regard to the qualified individual's need for the funds; and [3] The amount of the distribution is not required to correspond to the extent of the adverse financial consequences experienced by the qualified individual. Pension plans cannot permit Coronavirus distributions unless the participant otherwise has a distributable event that permits a distribution."

Jackson Walker

[Guidance Overview]

DOL Issues Final Rule on Retirement Plan Electronic Disclosures

"Plan administrators may still rely on the 2002 safe harbor, which many plan administrators may find preferable and less complicated. However, the final rule states that certain delivery methods that the DOL had previously approved for specific ERISA disclosures are no longer available, having been superseded by the new safe harbor. Specifically, plan administrators will no longer be able to provide pension benefit statements or participant-level fee disclosures using a 'continuous access website,' as permitted under [FAB 2006-03]."

Miller Johnson

[Guidance Overview]

GASB Issues Guidance on Certain Component Unit Criteria and Section 457 Deferred Compensation Plans

"Prior standards presumed that all Section 457 plans were not pension plans and, therefore, were not subject to pension plan reporting requirements; similarly, benefits provided through Section 457 plans were not reported as pension benefits. Under Statement 97, however, Section 457 plans should be classified as either a pension plan or other employee benefit plan, depending on whether the plan meets the definition of a pension plan. It also clarifies that Statement 84, as amended, should be applied to all arrangements organized under IRC Section 457 to determine whether those arrangements should be reported as fiduciary activities."

Governmental Accounting Standards Board [GASB]

Second Circuit Bounces Long-Running 401(k) Stock-Drop Case Back to District Court

"On remand, the 2nd Circuit invited the parties, as well as the federal government and other amici, to submit supplemental briefs regarding the appropriate disposition of the appeal, including whether the court should consider any arguments not previously raised before the court.... But after reviewing the submissions, the 2nd Circuit reinstated its original judgment, reversing the district court's granting of defendants' motion to dismiss, noting that the arguments raised in the supplemental briefs either were previously considered by the court or were not properly raised." [Jander v. Ret. Plans Comm. of IBM, No. 17-3518 (2d Cir. Jun. 22, 2020)]

American Retirement Association [ARA]

Another District Court Rejects Use of Segal Blend for Use in Multiemployer Plan Withdrawal Liability

"Employers who have withdrawn from a multiemployer pension fund that has assessed a withdrawal liability using the Segal Blend or some other discount rate assumption that varies from that used for funding and who do want to consider challenging that liability should consider: [1] Getting an analysis from an actuary independent from the fund of what the difference in withdrawal liability would have been had the fund used the same discount rate it does for funding calculations. [2] Determining whether that difference is sufficient to justify the cost and effort of pursuing arbitration and a possible court battle." [Sofco Erectors, Inc. v. Trustees of the Ohio Operating Engineers Pension Fund, No. 19-2238 (S.D. Ohio May 19, 2020)]

October Three Consulting

DOL Seeks Input on Pooled Employer Plans and Open MEPs

"The new RFI covers PEPs in addition to the MEPs covered by DOL's 2019 final rules. DOL is seeking information on the possible parties, business models, conflicts of interest and prohibited transactions that might exist for PEPs and MEPs. The RFI is split into three sections: [1] Pooled plan providers and MEP sponsors.... [2] Plan investments.... [3] Employers in the PEP or MEP."


401(k) Plan Issues in the Current Environment

"[1] Proper plan governance ... [2] Partial plan termination ... [3] Suspending safe harbor nonelective or matching employer contributions ... [4] Suspending nondiscretionary nonelective or matching employer contributions ... [5] Suspending discretionary nonelective or matching employer contributions ... [6] Paycheck protection program ... [7] Plan amendments, employee notices, and written procedures."

The CPA Journal

Avoiding Pitfalls in Retirement Plan Forfeitures (PDF)

"Some plan sponsors have been surprised to find that their plan documents do not align with their plan operations. Ensuring that forfeitures occur timely and are used according to the terms of the plan document will mitigate compliance risk.... [This article] outlines the timing and approved uses of forfeitures and provides additional considerations for forfeiture-related events."


401(k) Plan Sponsors: Look Before You Leap -- Do MEPs Really Reduce Fees?

"The 'all in' price comparison always seems the easiest to quantify and thus may be the easiest item to discuss in competing for business. Pricing within the price, may not be as easy to quantify: [1] Outsourcing the plan sponsor role -- what is the cost/savings here to transition risk? [2] Outsourcing the administration -- what's the cost/savings here to save time and risk? [3] Outsourcing the trustee -- what's the cost/savings here to outsource risk, liability? Simply identifying the 'all in price' does not tell the whole story."

Fiduciary News

PBGC 2018 Data Tables: First Installment (PDF)

39 pages. These tables provide researchers, journalists, and the public with statistics on PBGC's Single-Employer and Multiemployer Insurance Programs and the private defined benefit pension system. This first installment includes summaries and breakdowns of: [1] Claims activity; [2] Financial position; [3] Premium revenue; [4] Guaranteed benefit payments; and [5] Administrative expenses.

Pension Benefit Guaranty Corporation [PBGC]

CITs in the 403(b)?

"Bipartisan legislation was recently introduced to make this investment vehicle available in 403(b) plans. What are [collective investment trusts] and why might they make a good fit for the 403(b)?"


Perceptions of Mortality: Individual Assessments of Longevity Risk

"This paper assesses the evolution of subjective survival probabilities, defined as the probabilities that people believe they will live to at least 75 or 85 years of age. [It examines] the correlates of these reported probabilities when initially measured, how they change over time, ... how they change with major life course events like the death of a parent, in-law, spouse, or sibling ... [and] how the subjective probabilities change in response to health shocks such as a heart attack or diagnosis of diabetes."

Pension Research Council, The Wharton School of The University of Pennsylvania


As Shareholders Come Together to Vote, Investors Must Work to Keep Politics Out of Public Pensions

"The COVID-19 market crash has greatly exacerbated pension liabilities in many states and localities -- even ones which had previously been well-funded.... Given the severity of the current situation, it is imperative that public officials re-commit to their fiduciary obligations and ensure that public pension investments are freed from any outside political considerations."

Institute for Pension Fund Integrity [IPFI]

Benefits in General

Personalized Benefits: A Critical Employee Consideration

"Now is the ideal time for employers to step up their support through a benefits strategy that custom curates a distinct benefits plan for each segment of the employee population.... By applying data analytics to employee demographic information -- using census data, for example -- employers can improve their understanding of opportunities or gaps in their population on the benefits side. Reframing our offering and how we communicate its value is key."

HUB International

Serious Employee Benefit Plan Concerns Lingering as Pandemic, Recession Threaten Businesses

"Among organizations that have terminated employees as a result of the pandemic, 17% have been able to make it possible for the former employees to remain eligible for the ongoing health plan (without having to elect COBRA) and 42% are fully or partially subsidizing the cost of COBRA coverage.... More than 60% of companies that offer self-insured health care coverage expect that the pandemic will result in increased costs (moderately or significantly) in future plan years.... More than 17% of companies are taking action to reduce or eliminate matching contributions in their 401(k) plans, while another 10% are considering or anticipating doing so."

American Benefits Council

Executive Compensation
and Nonqualified Plans

[Guidance Overview]

IRS Issues Proposed Regs for Tax-Exempt Organizations Paying Excess Executive Compensation

"[T]he proposed regulations add several exceptions made in response to concerns that if a highly paid officer of a for-profit business provided volunteer services to a related [applicable tax-exempt organization (ATEO)], the for-profit business could find itself subjected to an allocable portion of the excise tax.... The proposed regulations ... [specify] that it is only the excess parachute payments made by the ATEO that are subject to the tax. Related non-ATEOs that pay an amount that would otherwise qualify as an excess parachute payment are not subject to this tax. "

Jackson Lewis P.C.

Selected Discussions
on the BenefitsLink Message Boards

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Pooled Plan Sued for Declaring Special Valuation

"I don't think the participants can win this, but if you've been sued you've lost as a practical matter. Monday morning quarterbacking it -- the employer communicated poorly (I'm not a lawyer but it seems that some of those communications might have left them exposed), and has totally dropped the ball on moving assets to cash when it KNEW these distributions were pending."

BenefitsLink Message Boards

COVID-19 Loan -- Extension and Reamortization

"Am I the first one to see this? Under the safe harbor in IRS Notice 2020-50, a qualified employer plan will be treated as satisfying the requirements of Section 72(p) pursuant to section 2202(b)(2) of the CARES Act if a qualified individual's obligation to repay a plan loan is suspended under the plan for any period beginning not earlier than March 27, 2020, and ending not later than December 31, 2020 (the 'suspension period'). The loan repayments must resume after the end of the suspension period, and the term of the loan may be extended by up to 1 year from the date the loan was originally due to be repaid. So I admit: 'I was wrong.' They even said you can do the crazy thing of suspending through Dec 31, making the regular payments until the 1 year mark for the suspension, and then reamortize what is left."

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Summary of Provisions That Would Change the Social Security Program (PDF)
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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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