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January 27, 2021 logo logo
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[Guidance Overview]

DOL Tips to Address Missing Participants

"While most plan sponsors are faced with at least some missing participants, the 'red flags,' as the DOL terms them in the Best Practices document, outline situations that may indicate to an organization that it has a missing participant problem.... [T]he DOL's guidance also lists a variety ways that these issues can be addressed." Icon to read more

Cammack Retirement Group

Exceptional Usefulness and Quality icon2021 403(b) Retirement Plan Compliance Calendar

"The 2021 Retirement Plan Compliance Calendar highlights critical compliance deadlines for defined contribution retirement plans. While all major dates are included, some may only apply to particular plan types (and are noted accordingly) and there may be additional deadlines for specific plans that are not covered here. Plans with non-calendar plan years may be subject to different deadlines." Icon to read more

Cammack Retirement Group

DOL Settlement Takes Aim at Indemnification for ESOP Fiduciaries

"While many of the earlier settlements with ESOP fiduciaries have provided helpful guidance in assessing a potential transaction, the Order continues a trend started a year ago regarding indemnification that could lead to the end of legally permissible indemnification arrangements. This development underlines the importance of proper consideration of the totality of potential sources of funding for litigation budgets ... when negotiating their engagement with an ESOP or ESOP sponsor given that indemnification may not provide adequate cover." [Scalia v. Professional Fiduciary Services, LLC, No. 19-7874 (S.D.N.Y. proposed settlement filed Jan. 12, 2021)] Icon to read more

Polsinelli, via JDSupra

Emergency Pension Plan Relief Act Proposes a Bailout of Struggling Multiemployer Pension Plans

"House Education and Labor Chairman Bobby Scott (D-VA) recently introduced legislation that seeks to rescue multiemployer pension plans facing insolvency. ... [T]he Emergency Pension Plan Relief Act (EPPRA) [HR 423] ... would fund this rescue directly from the U.S. Treasury. As drafted, however, the legislation does not propose any reform to the multiemployer pension system, and would expose contributing employers to increased liability over the next 15 years." Icon to read more


House Committee Chairmen Introduce Single Employer Funding Relief

"On January 21, 2021, Congressman Neal (D-MA), Chairman of the House Ways and Means Committee, and Congressman Scott (D-VA), Chairman of the House Education and Labor Committee, introduced single employer plan funding relief proposals. Both bills are titled the 'Emergency Pension Plan Relief Act of 2021.' The single employer plan funding relief proposals under both bills are identical. Both bills also include (differing) multiemployer plan relief proposals." [Editor's note: Rep. Neal's bill is HR 409; Rep. Scott's is HR 423.] Icon to read more

October Three Consulting

Exceptional Usefulness and Quality icon2020 NCPERS Public Retirement Systems Study (PDF)

39 pages. "Reporting funds saw, on average, 1-year returns of around 8.1 percent. The 5-year average was slightly below the assumed rate of return, while the 10-year average returns outperformed the assumption. The 20-year returns fell below the assumed rate of return as the strong performance of the late 1990s began to roll off the average.... The average investment assumed rate of return for responding funds is 7.26 percent, compared with 7.24 percent last year." Icon to read more

National Conference on Public Employee Retirement Systems [NCPERS]

Social Security Retirement Earnings Test: How Earnings Affect Benefits

"In 2019, the Social Security Administration's Office of the Chief Actuary estimated that, over the long-range projection period (2019-2093), the elimination of the [retirement earnings test (RET)] would have a relatively small positive effect on the solvency of the Social Security Trust Funds. This is primarily due to the fact that the increases in permanent early retirement reductions for entitlement at age 62 are projected to outweigh the increases in benefit entitlements." [R41242, updated Jan. 26, 2021] Icon to read more

Congressional Research Service [CRS]

Tax Numbers Your Employees Need to Know in 2021

"While the IRS and Social Security Administration announce these figures every fall, January is really when you need to pay attention to them.... [There are] three sets of tax figures that all employees should know. They relate to compensation from work: paycheck withholding, the potential need for estimated taxes, and your retirement savings." Icon to read more


Potential Benefits of Universal Access to Retirement Savings: An Analysis of National Options to Expand Coverage

54 pages. "[N]ational universal workplace access scenarios could reduce the access gap and expand retirement savings coverage by 28 to 40 million workers (depending on the chosen design features) by the year 2040, with additional participation from 50 to 70% of private sector workers currently lacking access.... [By] starting to save early in their careers, through simple, automatic, and consistent contributions, and by capitalizing on incentives to save and compounding investment returns over an extended time horizon, millions of additional private sector workers with typical earnings levels will begin to save and build substantial private savings that will increase their retirement incomes." Icon to read more

Georgetown University Center for Retirement Initiatives

Selected Discussions
on the BenefitsLink Message Boards

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Filing VCPs for Clients

"With the IRS requirement to file and pay for VCPs at, how are you handling this for your clients? With the new electronic requirement, I was completing the 8950 and 8951 in a .PDF and providing it to my clients so all they had to do was fill in the blanks and submit the fee. Our Forms provider links us to the IRS website and no longer provides a copy of the form. Neither does the IRS. Curious how others are handling." Icon to read more

BenefitsLink Message Boards

1099-R Question: Code G or Code 4?

"It's been a while since I completed a 1099-R for a beneficiary, so I just wanted to confirm. We use the name/SSN for the beneficiary and if they rolled it over it goes as a G, correct? Or do I use Code 4?" Icon to read more

BenefitsLink Message Boards

Custodian Says Participant Has an Invalid SSN But That's News to Us

"Employee requested a COVID-related distribution from 401(k) plan. Custodian has come back and told the employer that the SSN provided for the employee 'does not exist according to the IRS database' and they cannot issue a distribution without a valid SSN. I presume this was determined using the Social Security Number Verification System (SSNVS). There's no suggestion that this is a duplicate SSN or actually belongs to another person, etc. Employer has had no issues with wage reporting for the SSN. Employee insists the SSN is correct. Can the custodian (a bank) refuse to make the distribution from the plan based on the info from the SSNVS?" Icon to read more

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View COVID-19 News and Resources, Inc.
56 Creeksong Road
Whittier, North Carolina 28789
(407) 644-4146

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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