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Retirement Plans Newsletter

August 31, 2021

3 New Job Opportunities


[Guidance Overview]

IRS 'Issue Snapshots' Show Continued Focus on 403(b) Plan Compliance

"One snapshot reviews the universal availability requirement for plans that prohibit employees from participating under Section 403(b)'s statutory exclusions. The other addresses how to apply the Section 415 limit when a 403(b) annuity contract is aggregated with a qualified defined contribution (DC) plan. Snapshots generally summarize existing guidance rather than provide new information, but they may alert plan sponsors to the kinds of issues IRS agents review during plan audits."  MORE >>



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[Guidance Overview]

The 403(b) 'Qualified Plan Distribution Annuity Contract' Under SECURE Act Section 109

"[T]he SECURE Act introduced yet another new twist to the 403(b) world: the Qualified Plan Distribution Annuity Contract [QPDAC] ... [U]nlike 401(a) plans, 403(b) plans are commonly funded, at least in part, with annuity contracts. This raises a whole host of issues[.]"  MORE >>

Business of Benefits

[Guidance Overview]

A New and (Further) Improved EPCRS

"[Rev. Proc. 2021-30] replaces the previous version in its entirety.... The period for self-correcting significant operational and plan document failures is longer.... Some additional operational failures may be corrected through a retroactive plan amendment under SCP.... There are new options for correcting overpayments to plan participants and beneficiaries."  MORE >>

Verrill Dana LLP

Judge Dismisses Kraft Heinz Stock-Drop Lawsuit

"[Participants] claimed defendants should have acted to protect participants' investments by disclosing unfavorable financial information. The complaint 'is fuzzy on exactly what plaintiffs believe defendants should have disclosed and when,' [the federal district judge wrote]." [Osborne v. Employee Benefits Board of Kraft Heinz, No. 20-2256 (N.D. Ill. Aug. 23, 2021)]  MORE >>

Pensions & Investments

When It Comes to Fees, How Does a 401(k) Fiduciary Measure Value?

"From the plan sponsor's perspective, the 'right fee for the right value' represents a very broad window of acceptability. In fact, it might be accurate to say 'it's reasonable until it's not.' Nobody wants to test the limit of reasonableness, so the safest thing is to stay within a fairly common range. Still, it's a wide range because plans can be widely different."  MORE >>

Fiduciary News; free registration required

Retirement Readiness Among Older Workers 2021 (PDF)

42 pages. "51% have less than $50K saved for retirement ... Only 44% think they will have enough income throughout retirement.... Despite low savings and lofty income expectations, one-third think they'll retire prior to age 65 and one-half at 65 or younger.... 87% believe it is important that the income from savings is guaranteed for life ... 26% indicate lifetime income is the most important trait of a retirement investment."  MORE >>

Insured Retirement Institute [IRI]

Self-Directed 401(k) Balances Increase 22% Year-Over-Year

"[T]he average account balance across all participant accounts finished Q2 2021 at $348,183, a nearly 22% increase year-over-year and a 4.3% increase from Q1 2021.... [T]rading volumes were in line with one year ago at an average of 14 trades per account ... The majority of participant assets were held in equities (37%). Mutual funds were the second largest holding at (30%), followed by ETFs (20%), cash (12%), and fixed income (1%)."  MORE >>

Charles Schwab

What Does a 401(k) Annual Audit Encompass?

"[T]here are two types that the administrator can instruct the auditor to perform ... The difference between these two audits with regard to audit procedures is that in an ERISA Plan Audit, the 401(k) Plan's investment information is subject to audit procedures, while in an ERISA Section 103(a)(3)(C) Audit, the auditor will not perform audit procedures on the investment information that is prepared and certified to be complete and accurate by a qualified institution."  MORE >>


Exceptional Usefulness and Quality icon How to Use Annuities During Retirement

"[S]ubstituting [single premium immediate annuities] for investment-grade bonds appears to be almost unambiguously sound. However, the competition tightens considerably when using bonds to generate total return rather than for income alone. That is, instead of clipping bond coupons while retaining principal, our retiree in effect creates her own annuity by dipping into capital. Doing so would sharply increase her sustainable withdrawal rate."  MORE >>

John Rekenthaler, via Morningstar


How Fixed Deferred Annuities Can Complete Your Retirement Income Strategy

"If you're not yet willing to give up control over some of your assets now in exchange for future income, consider accumulation-type annuities.... If because of the stock market's advance or other reasons, you're now too heavily invested in equities, you should boost your fixed-income allocation. If you can afford to tie up some of your money for a few years, a fixed-rate annuity can be optimal.... Fixed-indexed annuities offer market growth potential without downside risk ... Consider your goals before investing."  MORE >>


Benefits in General

[Official Guidance]

IRS Provides Tax Relief to Victims of Hurricane Ida

"Victims of Hurricane Ida that began on August 26 now have until January 3, 2022, to file various individual and business tax returns and make tax payments ... The IRS is offering this relief to any area designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance. Currently this includes the entire state of Louisiana, but taxpayers in Ida-impacted localities designated by FEMA in neighboring states will automatically receive the same filing and payment relief." [IR-2021-175]  MORE >>

Internal Revenue Service [IRS]

Employee Benefits Jobs

View job as 3(16) Account Manager
for Ubiquity Retirement + Savings 3(16) Account Manager

Ubiquity Retirement + Savings

Remote / San Francisco CA / AZ / CO / FL / IL / KY / LA / MA / MO / MS / NC / NJ / NV / NY / OH / OR / RI / SC / TN / TX / WA

View job as 3(16) Account Manager
for Ubiquity Retirement + Savings

View job as Plan Administrator/ Consulting
for Associated Pension Consultants Plan Administrator/ Consulting

Associated Pension Consultants

Chico CA / Sacramento CA

View job as Independent Enrolled Actuary
for Pension Consulting Actuary Independent Enrolled Actuary

Pension Consulting Actuary

Remote / Palm Beach Gardens FL / CA / NY

Press Releases

LIMRA Further Enhances Its Data Exchange Standards to Include Leave Management and Employee Assistance Programs


Leading Employee Benefits Lawyer Anthony Provenzano Joins Crowell & Moring

Crowell & Moring LLP

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

How to Address Inflation Risk When Investing for Retirement

September 9, 2021 WEBCAST

Broadridge Financial Solutions, Inc.

Last Issue's Most Popular Items

The SECURE Act Revisited

Benefit Resources Inc.

Questions Retirees Often Get Wrong About Taxes in Retirement


DOL Ramps Up Retirement Plan Cybersecurity Investigations

Hall Benefits Law

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

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