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Retirement Plans Newsletter

August 18, 2021

2 New Job Opportunities


[Guidance Overview]

IRS Issue Snapshot: Expansion of Rollover Options Includes Savings Incentive Match Plan for Employees (SIMPLE) IRA Plans

"Issue Indicators or Audit Tips: [1] Check the SIMPLE IRA for rollovers from other plans, the date of the rollover, and the age of the SIMPLE IRA account. [2] Rollovers from Roth IRAs are not allowed. [3] The rollover from another type of plan to a SIMPLE IRA must be made after December 18, 2015, the date of enactment."  MORE >>

Internal Revenue Service [IRS]


SPARK Forum - November 7-9, 2021 -- The Breakers, Palm Beach, FL

3 days packed with actionable insights for advisors, recordkeepers and plan providers. Explore latest trends, strategies and ideas to lead through disruption. Join the retirement event with the most senior audience and network with purpose. Register Now.

Sponsored by SPARK

[Guidance Overview]

Alert (High Risk Issue) icon IRS Issue Snapshot: Application of Section 415(c) When a 403(b) Plan Is Aggregated with a Section 401(a) Defined Contribution Plan

"Issue Indicators or Audit Tips: This issue is frequently found during examinations of 403(b) plans maintained by governmental and tax-exempt healthcare entities and colleges/universities.... If outside employment is not permitted, the agent may consider plan aggregation a low audit risk. If the employer is silent about or permits outside employment, determine the procedures used to inform employees about the aggregation rule, and review any notices, forms, or other written communications containing that information. Review any information employees must provide to the employer regarding outside employment and plan contributions."  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

IRS Issue Snapshot: Section 457(b) Eligible Deferred Compensation Plan -- Written Plan Requirement

"The Examination Agent is required to review plan documents to ensure it was adopted timely and is in compliance with the regulations.... The plan document should be reviewed for subsequent law changes ... A plan document failure may cause an operational failure."  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

IRS Issue Snapshot: Church Plans, Automatic Contribution Arrangements, and the Consolidated Appropriations Act, 2016

"The automatic enrollment provision of the PATH Act supersedes any state law that restricts the ability of a church plan to have an automatic contribution arrangement."  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

NYC Mandates Retirement Plan Sponsorship by All But the Smallest Private Employers

"Two recently enacted New York City laws (Bill Nos. 888-A and 901-A, collectively the 'Retirement Security for All' acts), will require private-sector employers with five or more employees to enroll eligible New York City employees in either their own plan or in a city-managed retirement savings plan."  MORE >>


Court Revives Part of NYU 403(b) Plan ERISA Suit

"The appellate court agreed with the plaintiffs that the district court erred in dismissing claims regarding the use of retail share classes rather than cheaper share classes for funds in the plan. It also agreed with the plaintiffs that the district court improperly denied their motion to amend the complaint to include individual retirement plan committee members as defendants in the suit." [Sacerdote v. New York Univ., No. 18-2707 (2d Cir. Aug. 16, 2021)]  MORE >>

PLANSPONSOR; free registration may be required

Seventh Circuit Ruling Highlights ERISA Contradiction Related to Preemption

"This ruling illustrates the complexity of ERISA preemption and the law's internal contradiction between the exclusive benefit rule and the parallel responsibilities of corporate officers and directors who are permitted by ERISA to also serve as plan fiduciaries. However, though the decision in this [bankruptcy case involving an ESOP valuation] solves one problem, it leaves a second problem unresolved. It remains unclear how Argent and Stout could be sued, since the trustees lacked standing to bring an action under ERISA." [Halperin v. Richards, No. 20-2793 (7th Cir. Jul. 28, 2021)]  MORE >>

DeBofsky Sherman Casciari Reynolds P.C.

Aggregate Funded Percentage for Multiemployer Plans at Its Highest Point Since 2007

"The aggregate funded percentage for multiemployer plans is estimated to be 92% as of June 30, 2021, up from 88% at the end of 2020. The market recovery continued into the first half of 2021, resulting in the highest aggregate funded percentage since 2007. The financial assistance provided by [ARPA] will have a significant impact on funded percentages of eligible plans in the coming years."  MORE >>


Benefits in General

Prof. Jonathan Forman Dies

BenefitsLink is saddened to learn of the Aug. 16 death of Prof. Jonathan ("Jon") Forman of the University of Oklahoma College of Law. He was a member of the American College of Employee Benefits Counsel, and a prolific author on numerous tax and ERISA issues. "He will be greatly missed in our academic community," said Prof. Donald T. Bogan, also of the University of Oklahoma College of Law.  MORE >>

BenefitsLink Message Boards

Employee Benefits Jobs

View job as Pension Plan Administrator
for DeMars Pension Consulting Services, Inc. Pension Plan Administrator

DeMars Pension Consulting Services, Inc.

Overland Park KS

View job as Pension Plan Administrator
for DeMars Pension Consulting Services, Inc.

View job as Health Insurance Specialist
for Centers for Medicare & Medicaid Services [CMS] Health Insurance Specialist

Centers for Medicare & Medicaid Services [CMS]

Remote / Woodlawn MD / Dallas TX / Atlanta GA / San Francisco CA / Denver CO / Chicago IL / Boston MA / Kansas City MO / Philadelphia PA / New York NY / Seattle WA

Selected New Discussions

Full Vesting at Normal Retirement Age Despite Being Employed by Non-Participating Controlled Group Member?

"Myra works at Entity W and enters its retirement plan. She later transfers to Entity T, which is in the same controlled group as Entity W. Entity T has not adopted the plan, however. While working at Entity T, she attains normal retirement. Before her transfer, she was not fully vested in the employer's contributions. Must she be given full vesting now?"

BenefitsLink Message Boards

Reallocating Amounts in Forfeiture Account at Plan Termination

"A 401(k) plan is terminating. The plan sponsor has a huge balance in the forfeiture account. The plan document does not say whether the balance in the forfeiture can be reallocated to the eligible participants. I believe they can have the funds re-allocated, but this would require a plan amendment. The IRS permits reallocation for terminating plans, right?"

BenefitsLink Message Boards

Forfeiture of Vested Funds Due to Embezzlement?

"I have a client whose employee was fired and convicted of embezzling company funds. There is an outstanding restitution amount. Employee has a 100% vested benefit in the plan. It's a Safe Harbor Plan, so employer contributions (match) are 100% vested. Anyone know of a way to forfeit some or all of those matching contributions? I'm almost 100% sure there is none."

BenefitsLink Message Boards

Press Releases

PenChecks Opens New Call Center to Improve Phone Support

PenChecks Trust

Schwab Retirement Plan Services Launches My Financial Guide to Help Workers Take Control of Their Financial Lives

Charles Schwab Corporation

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Cash Balance Plans for Advisors

September 23, 2021 WEBCAST

Nova 401(k) Associates

Resiliency of Cost Sharing Mechanisms in Public Pension Plans

September 23, 2021 WEBCAST

Society of Actuaries

IRA Withholding and Getting it Right

October 26, 2021 WEBCAST


Last Issue's Most Popular Items

IRS FAQs: Substantially Equal Periodic Payments

Internal Revenue Service [IRS]

IRS Makes Important Changes to Plan Correction Program


Text of IRS Notice 2021-50: Weighted Average Interest Rates, Yield Curves, and Segment Rates for August 2021 (PDF)

Internal Revenue Service [IRS]

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

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