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[Guidance Overview]

2021 IRS Benefits & Contributions Limits Announced

The maximum limit on annual additions rose from $57,000 to $58,000 and the annual limit on compensation taken into account rose from $285,000 to $290,000. Most other limits stayed the same. This chart shows details, and limits from 1996 to 2021. Icon to read more

Venable LLP

[Sponsored] – Who is Answering Your ERISA Questions?

Noted author and speaker S. Derrin Watson, J.D. is answering questions in our Ask the Author service. Get your answers from Derrin in four business hours or less. Contact us at: or 612-605-2266 Learn more

Sponsored by Burrmont Compliance Labs LLC

[Guidance Overview]

IRS Announces 2021 Cost of Living Adjustments to Various Retirement Plan Limits

"The key limits that increased include the compensation that is taken into account for plan purposes, the total amount that can be contributed on behalf of any participant in a defined contribution (including 401(k)) plan, and the Social Security Taxable Wage Base." Icon to read more

Ferenczy Benefits Law Center

[Guidance Overview]

Applicability of Regulation Best Interest to Retirement Plans

"[A]dvice given to legal entities and advice related to investing the assets of a business are not covered by the regulation.... The SEC says that plans 'generally' are not covered. Does this mean that sometimes they are covered? Yes.... Participants in plans are retail customers for purposes of Reg. BI." Icon to read more

Faegre Drinker

[Guidance Overview]

You Can’t Always Get What You Want: The End of ESG Investing in ERISA Accounts?

"In order to move the rule through quickly, DOL's proposal was only subjected to a 30-day comment period -- much shorter than the typical 60- to 180-day comment periods.... [Of] the over 1,000 comments received, the vast majority -- over 95% -- expressed opposition to the proposal.... Once implemented as a rule, the proposal's rapid pace and controversial process are likely to become subjects of close judicial scrutiny. Critics of the rule believe that it may not withstand legal challenge given the truncated comment period and overwhelming opposition. This begs the question, what is DOL thinking?" Icon to read more

Mintz, via Lexology; free registration required

[Guidance Overview]

Upcoming Deadline icon401(k) Plan Sponsors: Do You Need to Start Tracking Hours for Your Part-Time Employees?

"The issue for many plan sponsors, beginning January 1, 2021, will be how to efficiently track hours of service of part-time employees.... Many plan sponsors have elected to use [the elapsed time] method and incorporated it into the terms of the plan. Unfortunately, the SECURE Act does not mention the elapsed time method; therefore, it appears for now that plan sponsors that impose a service-based eligibility requirement on their employees will have to keep track of actual hours of service beginning January 1, 2021, at least for their part-time employees." Icon to read more


401(k) Fee Lawsuits: What Can a Plan Sponsor Do?

"[M]ost 401(k) lawsuits define the issue in very simple terms, e.g., the selection or retention of a particular option was imprudent because it had higher costs than other funds or generated returns that deviated from an established index. The fees and investment history associated with an investment option are obviously relevant, but the fiduciary process that underlies the decision to select, retain or replace a particular investment option normally is much more involved." Icon to read more

Foley & Lardner LLP

Upcoming Deadline iconFew Retirement Plans Need Year-End Amendments

"Most retirement plan sponsors won't face year-end amendment deadlines in 2020, but a few may need to adopt amendments to reflect changes in law or plan design. This GRIST summarizes the amendments that may be required by year-end for qualified defined contribution (DC) and defined benefit (DB) plans, 403(b) plans, and one amendment for some nonqualified deferred compensation (NQDC) plans." Icon to read more


Bipartisan Bill Introduced: 'Securing a Strong Retirement Act of 2020'

"Today, Ways and Means Committee Chairman Richard E. Neal (D-MA) and Ranking Member Kevin Brady (R-TX) introduced the Securing a Strong Retirement Act of 2020 ... [which] will: [1] Promote savings earlier for retirement by enrolling employees automatically in their company's 401(k) plan, when a new plan is created; [2] Create a new financial incentive for small businesses to offer retirement plans; ... [3] Expand retirement savings options for non-profit employees by allowing groups of non-profits to join together to offer retirement plans to their employees; [4] Offer individuals 60 and older more flexibility to set aside savings as they approach retirement; [5] Allow individuals to save for retirement longer by increasing the required minimum distribution age to 75; ... [6] Protect retirees who unknowingly receive retirement plan overpayments; and [7] Make it easier for employees to find lost retirement accounts by creating a national, online, database of lost accounts." [Also available: section-by-section summary of the bill and  its full text]. Icon to read more

Committee on Ways and Means, U.S. House of Representatives

Protecting Employees'​ 401(k) Accounts During the Health Crisis

"[1] Tell your employees to be overly cautious of unexpected e-mails requesting information about, or a distribution from your employees 401k account.... [2] Make sure expense payments to vendors related to your 401k plan continue to have appropriate reviews and approvals before payment.... [3] Create scheduled task lists for your employees working from home who are responsible for your 401k plan, to ensure tasks and responsibilities are not overlooked.... [4] The committee responsible for the oversight of your 401k plan still needs to meet regularly." Icon to read more

Bradley J. Bartells, CPA, via LinkedIn

Exceptional Usefulness and Quality iconESG Investing and Public Pensions: An Update

"Public pension plans have engaged in social investing since the 1970s in response to state mandates. More recently, the plans themselves have embraced a 'new' form of investing that incorporates environmental, social, and governance (ESG) factors. ESG investing is based on the notion that taking account of non-financial factors will lead to better investment outcomes. Some also believe ESG investing can further socially beneficial practices. The evidence suggests, however, that social investing: [1] yields lower returns; and [2] is not effective at achieving social goals. Hence, any form of social investing is not appropriate for public pension funds." Icon to read more

Center for Retirement Research at Boston College


What's 'Eating' 401(k) Haters?

"Like so many others who opine from ivory towers far removed from the front lines of workplace retirement plans, this author [of a recent Bloomberg opinion piece] blithely assumes that workers don't need the education, encouragement and financial support of employers and advisors. He ignores (or perhaps is simply unaware) of the data that shows how workers of even relatively modest means are 12 times more likely to save in their workplace retirement plan than on their own" Icon to read more

Data 'Points'


Public Pensions and COVID-19: Confronting a Crisis, and Opportunities for Reform (PDF)

15 pages. "The market downturn of the last several months has exacerbated the funding shortfalls facing many public pensions funds across the country ... In the short- and medium-term, pension funds will have increased difficulties meeting their required contributions and other financial obligations, and many may also face a liquidity crisis.... [P]ublic pension fund managers are now in a position to implement long-needed reforms to their investment, management, and public policy strategies." Icon to read more

Institute for Pension Fund Integrity [IPFI]


What Trump vs. Biden Means to 401(k) Plan Sponsors and the Typical Plan Fiduciary

"[T]he two candidates appear to offer stark variances in their views of retirement plan policy. Both want to change things. It's the nature and direction of those changes that could impact the lives of millions, the owners of the businesses they work for, and the retirement plan professionals who have dedicated their lives to a relatively stable industry.... in looking at the two candidates, President Trump and Vice-President Biden, precious little has been said on the state of 'fiduciary.' Instead, a new battle line has been drawn. This time it falls under the trope of 'taxes' rather than 'fiduciary.' " Icon to read more

Fiduciary News; free registration required

Benefits in General

Why Total Benefits Outsourcing Isn't the Answer for Today's Employers

"[S]ignificant changes in the benefits and technology landscape and a growing focus on employee engagement over the past several years have resulted in [total benefits outsourcing (TBO)] being an ineffective and costly option for employers. Here's a close look at the challenges of TBO, and how a best-in-class approach to benefits has emerged as the answer to the needs of today's employers and employees." Icon to read more


EBSA Restores Over $3.1 Billion to Employee Benefit Plans, Participants and Beneficiaries (PDF)

"In FY 2020, EBSA closed 1,122 civil investigations with 754 of those cases (67%) resulting in monetary results for plans or other corrective action. Recoveries on behalf of terminated vested participants played a large role in these results. In total, EBSA's enforcement program helped over 29,600 terminated vested participants in defined benefit plans collect benefits of over $1.48 billion owed to them.... In FY 2020, EBSA closed 230 criminal investigations. EBSA's criminal investigations, as well as its participation in criminal investigations with other law enforcement agencies, led to the indictment of 70 individuals -- including plan officials, corporate officers, and service providers -- for offenses related to employee benefit plans." Icon to read more

Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

Selected Discussions
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Profit Sharing Allocation for Terminated Unvested Participant

"Ran across a situation where in order to avoid a 410(b) failure, must make a profit sharing contribution for a terminated participant who is 0% vested. The plan is top heavy and has never made a profit sharing situation before. The required contribution is over the $5k involuntary cash-out threshold. What are the options for how should the plan handle this circumstance? Hope that the balance falls below $5k so they can force the participant out? Wait until the plan someday terminates and the funds become 100% vested?" Icon to read more

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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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