Retirement Plans Newsletter

January 13, 2021 logo logo
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Job Openings

View job as Retirement Plan Consultant for Definiti
View job as Retirement Plan Consultant for Definiti Retirement Plan Consultant

Telecommute / Dallas TX / University Place WA / The Woodlands TX

View job as Retirement Plan Administrator for Integrity Pension Services, LLC Retirement Plan Administrator

Integrity Pension Services, LLC
Telecommute / Las Vegas NV

View job as Retirement Account Analyst, Senior for Alerus Retirement Account Analyst, Senior

Telecommute / Arden Hills MN / Albert Lea MN / Grand Forks ND

View job as Temporary Retirement Benefits Analyst 2 for University of California Office of the President Temporary Retirement Benefits Analyst 2

University of California Office of the President
Oakland CA

View job as Temporary Benefits Analyst 3 for University of California Office of the President Temporary Benefits Analyst 3

University of California Office of the President
Oakland CA

View job as Client Services Manager for Newport Client Services Manager

Folsom CA / Chicago IL / Saint Petersburg FL / La Crosse WI / Charlotte NC / Overland Park KS / Mobile AL / West Des Moines IA

View job as Retirement Plan Administrator for Qualified Pension Consultants, Inc. Retirement Plan Administrator

Qualified Pension Consultants, Inc.
Telecommute / Independence OH

View job as Health Care Attorney for Teacher Retirement System of Texas Health Care Attorney

Teacher Retirement System of Texas
Austin TX

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[Official Guidance]

Text of 2021 Instructions for IRS Forms 1099-R and 5498: Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. (PDF)

23 pages; Jan. 6, 2021. "What's New:  Safe harbor explanations for eligible rollover distributions. Notice 2020-62 contains the two model notices that may be provided to recipients of eligible rollover distributions to satisfy the notice requirements under section 402(f)." Icon to read more

Internal Revenue Service [IRS]

[Official Guidance]

Treasury Department Notice of Multiemployer Pension Plan Application to Reduce Benefits: Roofers Local No. 88 Pension Fund

"The Board of Trustees of the Roofers Local No. 88 Pension Fund ... has submitted an application to reduce benefits under the plan in accordance with [MPRA].... [T]he application ... has been published on the website of the Department of the Treasury ... Comments must be received by February 26, 2021." Icon to read more

U.S. Department of the Treasury

[Guidance Overview]

The DOL's Fiduciary Interpretation and Exemption: Impact on Rollover Recommendations

"To understand the impact of these changes, the starting point is in the prohibited transaction restrictions in ERISA and the Internal Revenue Code. Without getting into the weeds, those rules prohibit fiduciary recommendations to plans, participants or IRA owners that result in increased compensation for the 'fiduciary advisor.' That raises two issues. The first is the meaning of increased compensation and the second is what constitutes a fiduciary recommendation? [The authors] discuss both questions, and the answers, in the context of rollover recommendations." Icon to read more

Faegre Drinker

New Law Lets DB Plan Sponsors Quit 420 Transfers

"The new relief gives sponsors a temporary opportunity to put an early end to existing qualified future transfers and take all the unused money back. The minimum employer-cost requirements will still apply throughout the rest of the transfer period. Sponsors making the election still must meet certain reduced funding-level requirements for the DB plan during the original transfer period and the next five years." Icon to read more


Barriers to In-Plan Retirement Income Adoption

"Decision paralysis ... Clunky participant experience ... Lack of liquidity ... Portability ... Growth limitations ... Relative value." Icon to read more

401(k) Specialist

Advisors Take Steps to Measure Employee Engagement in Financial Wellness Programs (PDF)

"Employee engagement is essential in determining the value of any Financial Wellness program. The purpose of this Research Report is to help retirement plan sponsors design a Financial Wellness Program Management Dashboard based on the practices of leading retirement plan advisors. The report provides a framework for monitoring progress and gives guidance to plan sponsors on the key indicators to monitor." Icon to read more

Retirement Advisor Council


Pension Rights Center Comment Letter to IRS, Responding to SPARK Institute Letter Seeking Electronic Disclosure Guidance (PDF)

10 pages. "For Treasury/IRS to align its standards to [the notice-and-access safe harbor (NA)] and/or deem compliance with NA as compliance with its own standards as SPARK requests would hasten what has become a race to the bottom in consumer protections for retirement plan participants and beneficiaries. If anything, Treasury/IRS should strengthen the requirements in 2006 regulations to better protect participants and beneficiaries in this era of data overload and digital inequality to counterbalance the dramatic weakening of protections represented by DOL's new regime." Icon to read more

Pension Rights Center

Benefits in General

[Guidance Overview]

IRS Proposes Regs for Automatic Deadline Postponements for Federally Declared Disasters

"In addition to extending certain tax filing and tax payment deadlines, the postponements addressed in this guidance include completion of the many time-sensitive, tax-related acts described in IRS Revenue Procedure 2018-58 and Treasury Regulation 301.7508A-1(c)(1), which include filing Form 5500 for retirement plans, completing rollovers, making retirement plan loan payments, etc." Icon to read more


Executive Compensation
and Nonqualified Plans

Upcoming Deadline iconReminder: Employers Must Report 2020 ISO and ESPP Transactions

"The deadline for furnishing Copy B of Forms 3921 and 3922 to the employee or former employee for ISO exercises or ESPP shares purchased during 2020 is January 31, 2021. The deadline for filing Copy A of Forms 3921 and 3922 with the IRS depends on whether the returns are required to be filed electronically or manually. Corporations that are filing 250 or more copies of Form 3921 or 3922 ... must file Copy A of the forms electronically through the IRS FIRE system. The deadline for electronic filings is March 31, 2021. Corporations filing fewer forms can elect to file either manually or electronically, but manual filings must be made by February 28, 2021." Icon to read more

Latham & Watkins

Selected Discussions
on the BenefitsLink Message Boards

► It's easy to sign up and participate in discussions! Post answers, ask questions, create custom feeds and views. Join your peers (and potential referral sources or customers)—there is no charge.

Can a Partner Participate in the LLC's 401(k) Plan?

"ABC LLC is a multi-member LLC taxed as a partnership. One member, John, was incorrectly classified as a W-2 employee for many years, and is a participant in the company's 401(k) plan. Beginning 1/1/2021, John is receiving guaranteed payments on K-1 instead of W-2. Is John able to continue to participate in ABC's 401(k)?" Icon to read more

BenefitsLink Message Boards

Determination of Compensation When Deferral Feature Added Mid-Year

"A plan was established 1/1/2020. It allows prevailing wage and profit sharing contributions as of 1/1 but the effective date of the deferral provision is 4/1/2020. Should the compensation used for the ADP test be for the time period the deferral was effective, so 4/1 through 12/31/2020?" Icon to read more

BenefitsLink Message Boards

Interest Rate Used for COVID Reamortization of Loan

"We prepared a loan document for a client in December 2019, with an interest rate of the then-prime rate plus 2% (loan issued at 5.75%). With the COVID suspension and re-amortization, would the interest rate need to be the same?" Icon to read more

BenefitsLink Message Boards

Trustee/Owner/Participant to Be 50% Owner of Restaurant; Plan to Own Remaining 50%; Prohibited?

"Husband and wife own 100% of business that sponsors a DB plan. They are the only employees, the only participants, and the plan's trustees. Husband wants to buy an investment property (a building housing a fast food restaurant, but I don't think that's relevant) 50/50 with the plan as tenants in common. I believe this is a PT. Does anyone disagree?" Icon to read more

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Press Releases

ARA Welcomes its 2021 Board of Directors
American Retirement Association [ARA]

Most Popular Items in the Previous Issue

Missing Participants: Best Practices for Defined Benefit and Defined Contribution Plans
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

Text of EBSA Compliance Assistance Release 2021-01: Terminated Vested Participants Project -- Defined Benefit Pension Plans
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

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

BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2021, 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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