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U.S. Employer Outlook: Benefit Strategies for the Future
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2019 Federal and Maryland State Legislative Update
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COVID-19 and the New Workplace: How Safety Practices, Work Arrangements and Employee Benefits Have Changed
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[Guidance Overview]

IRS Notice 2020-62 Updates Safe Harbor Explanations for Recipients of Rollover Distributions from Qualified Retirement Plans

"Notice 2020-62 ... amends the two safe harbor explanations in Notice 2018-74 for the notices that must be provided by qualified retirement plans to all participants entitled to receive a distribution of their benefit.... The amendments relate to changes made by the [SECURE Act] and other clarifications."

Thomson Reuters Practical Law


SPARK/DCIIA Summer Policy Series

Live virtual event, every Wednesday, July 15 to August 19. Domestic and global topics; general and breakout sessions (live broadcast), exhibitor hall and virtual networking happy hours. Replay on demand. Free to SPARK and DCIIA members. Learn more! Learn more

Sponsored by SPARK and DCIIA

[Guidance Overview]

Not 'Wired at Work'? New DOL E-Disclosure Rule Is Here to Help

"Each plan sponsor will need to evaluate its plan participant sub-populations before choosing which e-disclosure safe harbor method or methods to use for retirement plan disclosures going forward.... [An] engineering firm whose entire population of active employees is wired at work may be content with the 2002 safe harbor e-disclosure method and may not want to switch to the 2020 safe harbor method, which would require an initial paper notice to all plan account holders notifying them of the new e-disclosure procedures. However, the same employer may want to switch to the 2020 safe harbor method for former employees who retain account balances, and for beneficiaries and alternate payees."

E is for ERISA

[Guidance Overview]

Reminder for 401(k) Plan Sponsors: Long-Term, Part-Time Employee Eligibility Requirements Take Effect in 2021

"Plan sponsors will have to address a number of related issues under 401(k) plans, including service crediting for vesting purposes, whether part-time employees will also be eligible for employer contributions under the plan (the SECURE Act change requires coverage for elective deferral purposes only, but a plan sponsor may want to align deferral eligibility with eligibility for employer contributions), and whether to exclude the long-term, part-time employees from nondiscrimination and coverage testing[.]"

Faegre Drinker

How Long Is the Long Arm of ERISA? The Limits of Controlled Group Pension Liability

"Jurisdictional requirements establish barriers for multiemployer plans and the PBGC when they are seeking to collect unpaid Title IV liability from a foreign entity. In fact, the existing standards seem to reward the foreign buyer that keeps its head in the sand about ERISA liability.... Whether or not [this case] is a correct interpretation of federal law, an inability to establish jurisdiction over non-U.S. entities in U.S. courts under the rules established in that and similar decisions may contribute to the current financial problems of the multiemployer pension system and affect the financial status of the PBGC." GCIU-Employer Retirement Fund v. Coleridge Fine Arts, No. 19-3161 (10th Cir. Apr. 6, 2020)]

Cohen & Buckmann, P.C.

Pension Funds Want Into Private Equity

"Government pension funds have found a new way to profit in private equity.... So says private equity. The American Investment Council is out with a study ... [which] lists 10 large, mostly state-sponsored pension plans it says have gotten returns averaging 16% from investing in private equity deals. The Michigan retirement system, it says, got returns of 15.4%. The one in Illinois got returns of 16.7%. Compare that with government bonds that now yield less than 1% and it's easy to see the attraction."



Plan Advisor Checklist: Identifying the Best Retirement Plan Prospects

Retirement plan prospecting can be difficult. Successful advisors are targeted and focused on bringing new ideas to clients and prospects. Use this checklist to define your target audience, identify meaningful opportunities and communicate your value. Learn more

Sponsored by October Three

Evolution with Purpose: The Glide Path Assessment Process During the Retirement Life Cycle

"Taking the time to assess the relative importance of each phase of a glide path will allow plan sponsors to understand the proportional impact on outcomes for retirement savers. Evolving the glide path assessment process may help plan sponsors ensure that target date products and their glide paths are well understood and chosen in accordance with their plans' long-term goals and their participants' retirement needs."

T. Rowe Price; free registration required

Retirement Financial Update: August 2020

"Pension interest rates tumbled another 0.40%, bringing the year-to-date decline to almost a full 1.00%.... [L]iabilities for most plans will have increased substantially during 2020.... While asset allocation plays a role, most plans probably saw their funded status stay the same over the month of July; however, due to the drop in interest rates this year, funded status has most likely deteriorated year-to-date."

River and Mercantile Solutions

Multiemployer Pension Funding Study: June 2020

"The estimated investment return for our simplified portfolio for the first six months of 2020 was about -1.3%, a significant recovery from the -13.4% return at the end of March. The aggregate funded percentage for multiemployer plans is estimated to be 82% as of June 30, 2020, down from 85% at the end of 2019. The market volatility and economic uncertainty associated with the COVID-19 pandemic has resulted in dramatic swings in plans' funding status over the last six months. While all plans absorb market gains and losses over time, extreme market movements immediately prior to a plan's measurement date can have a significant impact on its funding position and annual Pension Protection Act (PPA) zone status."


Social Security COLA 2021: What to Know About Cost-of-Living Benefits

"The government won't officially announce the next COLA until October, but experts are predicting a small raise or none at all.... COLAs are based on increases in the CPI-W from the third quarter of the prior year to the corresponding quarter of the current year in which the COLA became effective.... Currently, the year-over-year increase in the CPI-W through the second quarter of 2020 is 0.15%."



California Supreme Court Curtails Pension Abuse by Law Enforcement Officers, Others

"In a unanimous ruling on July 30, 2020, the California Supreme Court upheld PEPRA reforms that closed loopholes used by county workers to spike pensions. The decision is limited, however, to employees of 20 California counties that operate their own independent pension systems under the parameters of the County Employees' Retirement Law of 1937. But the '1937 Act counties,' as they are called, are some of California's most populous counties ... Unfortunately, the court did not make sweeping changes to the 'California Rule[.]' "

Independent Institute

Benefits in General

[Official Guidance]

Text of IRS News Release IR-2020-177: Joint Board Announces Temporary Waiver of 'Physical Presence' Education Requirement for Enrolled Actuaries (PDF)

"The Joint Board for the Enrollment of Actuaries today provided enrolled actuaries with notice that it is waiving the physical presence requirement for continuing professional education (CPE) credit for any formal programs conducted from Jan. 1, 2020, through Dec. 31, 2022.... This waiver applies to all enrolled actuaries, whether they are in active or inactive status.... Enrolled actuaries are still required to earn the same number of credit hours under formal programs that would otherwise be required."

Internal Revenue Service [IRS]

Caution Advised iconTenth Circuit's Interpretation of ERISA's Notice Requirements May Have Far-Reaching Effects

"A recent 10th Circuit decision holding that in order for the abuse of discretion standard to apply in litigation the claims administrator must provide participants with actual notice of discretionary authority or notice of a document affecting standard of review is required, signals a departure from the existing ERISA legal landscape." [Lyn M. v. Premera Blue Cross, No. 18-4098 (10th Cir. Jul. 24, 2020)]


Selected Discussions
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2020 RMDs As Applied on a State Income Tax Level

"Are individual states required to comply with the relief enacted under the CARES Act with regards to waived 2020 RMDs, Aug 31st due date for rollovers, and one IRA rollover per year exemption? I was told NY state is not following the CARES Act and was asked how to handle RMDs that were taken during 2020 and then rolled over into IRAs after 60-days for state tax purposes. Wouldn't it be based on how the states define eligible rollovers and whether they cite the federal code and regulations?"

BenefitsLink Message Boards

CARES Act IRS Notice 2020-61 for DBs

"I happen to be familiar with IRS Notice 2020-61, which came out [on Thursday, Aug. 6], covering the deferral of 2020 contributions to 1/1/2021 under the CARES Act. I found the Notice to be very confusing, so I thought I would start this thread to give pension actuaries a leg up on understanding this. This post will explain how and what interest rates are to be used in connection with DB contributions originally due during calendar 2020 under Notice 2020-61.

BenefitsLink Message Boards

Acceleration of Vesting of ISO = Modification?

"IRC section 424(h)(3)(C) provides that 'the term 'modification' means any change in the terms of the incentive stock option that gives the employee additional benefits under the option, but such term shall not include a change in the terms of the option in the case of an option not immediately exercisable in full, to accelerate the time at which the option may be exercised.' So far so good. But the accounting rules say that acceleration of vesting is a modification that leads to a new grant. Are both things true in that one refers to status as an ISO and the other refers to accounting treatment?"

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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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