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Retirement Plans Newsletter

July 7, 2021

4 New Job Opportunities


[Guidance Overview]

Best Interest Standard of Care for Advisors, Part 57

"This article looks at a DOL FAQ that discusses the 'regular basis' part of the 1975 regulation and explains how it reverses the prior DOL position -- and how that change means that many, if not most, rollover recommendations will be fiduciary advice subject to ERISA's prudent man rule."  MORE >>

Tenth Circuit Affirms Revenue Sharing Arrangement Is Not Prohibited Transaction

"After reviewing a decision in an ERISA lawsuit against Banner Health, the[court] found no reason to order the sponsor to implement an RFP process.... The 10th Circuit concluded that the plaintiffs provided no evidence to show that Fidelity had some pre-existing relationship with Banner or that the service agreement between Fidelity and Banner was anything less than an arm's-length deal." [Ramos v. Banner Health, No. 20-1231 (10th Cir. June 11, 2021)]  MORE >>


Supreme Court Agrees to Hear Northwestern University Excessive Fee Case

"The decision to review this case presents the possibility that the Court will for the first time speak to issues that plaintiffs and defendants have been disputing for at least a decade. [This article highlights] what is (perhaps) the most significant of those issues -- the ERISA pleading standard for claims a plan fiduciary authorized or allowed a plan to pay excessive/imprudent investment and/or recordkeeping fees." [Hughes v. Northwestern Univ., No. 18-2569 (7th Cir. Mar. 25, 2020; cert. pet. granted No. 19-1401, Jul. 2, 2020)]   MORE >>

October Three Consulting

Percentage of 401(k) Participants with Loans Dropping

"At the end of the first quarter, about 14% of 401(k) participants had outstanding loans. The percentage fell steadily throughout last year after edging up to 16.3% in the year-ago period from 16.1% in the fourth quarter of 2019. The loan rate was well below the over 18% seen in the wake of the Great Recession."  MORE >>

Pensions & Investments

Pension Finance Update, June 2021

"Pension finances were steady to down 1% in June due to falling interest rates, but both model plans ... remain comfortably in the black for the year: Plan A dropped 1% last month but remains up more than 10% during 2021, while the more conservative Plan B was flat last month and remains up almost 3% through the first half of the year:"  MORE >>

October Three Consulting

2021 Social Security Survey (PDF)

20 detailed presentation slides. "Generally, adults are at least somewhat confident in their knowledge of [Social Security (SS)] ... But when tested about specifics, clear gaps in knowledge exist.... SS not expected to be primary income source in retirement for younger adults.... More than 1 in 4 say COVID has impacted retirement plans.... Nearly 1 in 5 say COVID has impacted SS filing plans.... Only about half who work with [a financial professional] say they provide SS advice.... Contacting SS admin preferred over [financial professional] for learning about SS."  MORE >>

Nationwide Retirement Institute

How to (Legally) Buy Early Growth Shares in Your Roth IRA

"[W]hile IRAs can be used to purchase private, non-public companies, the Prohibited Transaction rules significantly restrict both who can sell shares to the IRA, what compensation the entrepreneur can receive when working for an IRA-owned company, and even the ability to contribute sweat equity to an IRA-owned company."  MORE >>

Nerd's Eye View

A Peek Inside Brokerage Windows: Industry Provides Input on DOL Advisory Committee's Study

"In 2014, the DOL issued a Request for Information to increase its understanding of the prevalence and role of brokerage windows in self-directed individual account plans, including why and how often brokerage windows are offered and used in ERISA-covered plans.... In connection with the Advisory Council's June 2021 meetings, various industry participants provided input on brokerage windows in participant-directed individual account retirement plans."  MORE >>

Thompson Hine, via Lexology (free registration required)


Testimony to the ERISA Advisory Council: Gaps in Retirement Savings Based on Race, Ethnicity and Gender (PDF)

"While there is an existing gap between Black and white workers who participate in defined benefit plans, the gap in defined contribution plans is much larger, with 49% of white workers nationwide participating in defined contribution plans compared to just 32% of Black workers, according to the Economic Policy Institute. With the power of compound interest, the gap is magnified."  MORE >>

John W. Rogers, Jr., Ariel Investments


Testimony to the ERISA Advisory Council: Understanding Brokerage Windows in Self-Directed Retirement Plans (PDF)

"[A]dditional guidance or requirements related to brokerage windows [could] [1] have an adverse effect on the ability of plan sponsors to offer brokerage windows to their employees and [2] consequently, reduce both plan participation and sponsorship.... [T]he participant-level disclosure regulation and FAB 2012-02R ... together are working very well to give plan sponsors and service providers appropriate, workable requirements and the guidance they need to understand the scope of their responsibilities while also ensuring that participants are not exposed to undue risks."  MORE >>

Kent A. Mason, Davis & Harman LLP

Executive Compensation and Nonqualified Plans

Legal Developments for Alternative Compensation Vehicles (PDF)

"[P]rivate entities deliver a broad range of significant compensation, whether it involves arrangements with partners, in the case of partnerships, or members, in the case of LLCs, in a wide variety of businesses -- hedge funds, private equity firms, asset managers, law firms, and accounting firms. The compensation issues arising in this context are different, and some recent case developments in this area are worth noting."  MORE >>

Proskauer, via Bloomberg Law

Employee Benefits Jobs

View job as West Region Manager
for Segal West Region Manager


San Francisco CA

View job as 401k Documents Consultant
for Newport 401k Documents Consultant


Telecommute / Dallas TX / Charlotte NC / Mobile AL / Lake Mary FL / Saint Petersburg FL / Chicago IL / AZ / CA / IA / MN

View job as Compliance Analyst
for Newport Compliance Analyst


Telecommute / Lake Mary FL / Fresno CA / Folsom CA / Greensboro NC / Saint Petersburg FL / Charlotte NC / Chicago IL / Moline IL / Urbandale IA / Scottsdale AZ / MI / SC

View job as Compliance Consultant
for Newport Compliance Consultant


Telecommute / Folsom CA / Fresno CA / Saint Petersburg FL / Moline IL / Chicago IL / Charlotte NC / AZ / IA / MN

Selected New Discussions

Differing Match and PS in Plan Without HCEs and Keys

"We're setting up a new plan for a controlled group of 5 companies that will probably have 2,000 participants when it's all done. By design, HCEs and Keys are excluded from participating. There will never be a test failure such as ADP, ACP, 410(b), or Top Heavy. That's not the issue.

The issue is that the owner (one person owns all of it) wants to pick and choose select groups or individuals to whom he will give a discretionary match and/or a discretionary profit sharing contribution according to his pleasure. His idea is that, because there are no applicable tests to fail, why not?

We feel uneasy about this but can't find anything to hang our hat on. Is this really permissible?"

BenefitsLink Message Boards

Schedule C Negative but 401k already funded

"I'm trying to find something that is written by the IRS or perhaps a prestigious law firm that talks about the proper treatment when a schedule C proprietor has negative self-employment income but has already funded his or her simple IRA contribution. Does anybody have such a resource? My assumption is the contributions are refunded, adjusted for gains. Because the deduction will not be taken in 2020, my assumption is that solely the investment earnings will be taxable in the year distributed. But I would still like to find something written on the topic in a formal way that I can provide to a CPA I work with."

BenefitsLink Message Boards

Press Releases

Bolton Announces Acquisition of RSC Advisory Group


Michelle Roberts Is Named by Northern California Super Lawyers as a 2021 Top 100 Super Lawyer

Roberts Disability Law

Alight Successfully Closes Business Combination with Foley Trasimene Acquisition Corp.


Preferred Pension Planning Corporation Acquires Tri-State Pension Consultants, LLC

Preferred Pension Planning Corporation

Pinnacle Acquires Block Consulting Actuaries

Pinnacle Plan Design

Webcasts and Conferences
(Retirement Plans or Exec Comp)

Voluntary Fiduciary Correction Program

July 19, 2021 WEBCAST

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

Post-Pandemic Benefits Issues

August 19, 2021 WEBCAST

American Bar Association Joint Committee on Employee Benefits [JCEB]

Virtual Compliance & Legislative Summit

October 4, 2021 WEBCAST


Last Issue's Most Popular Items

Retirement Account Rollovers: PTE 2020-02 vs. PTE 84-24

Faegre Drinker

SCOTUS Agrees to Hear ERISA 'Excessive Fee' Case

Steptoe & Johnson LLP

Cybersecurity for Plan Fiduciaries: Focus on Account Theft

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

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