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Retirement Plans Newsletter

September 29, 2021

4 New Job Opportunities


[Guidance Overview]

IRS Issue Snapshot: Deemed Distributions -- Participant Loans

"Issue Indicators or Audit Tips: [1] Review the plan document and/or loan policy to ensure that the plan is operating consistent with IRC Section 72(p). [2] Examine the outstanding participant loan documents.... [3] Determine if a loan should be considered a deemed distribution.... [4] Examine any Form 1099-Rs for deemed distributions to ensure that they were issued for the tax year the participant failed to cure the defect by the expiration of the cure period that resulted in the deemed distribution. [5] Look for indicators of fraud."  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]

Potential Plan Disqualification from an Unintended Affiliated Service Group -- No Pill's Gonna Cure Your Ill

"Whether the various employees are covered under one plan or three, however, the nondiscrimination testing and coverage testing must include everyone. The benefits from all three entities can be combined for testing (called 'permissive aggregation') if certain requirements are met.... One important thing to note: If the doctors are contemplating defined benefit or cash balance plans, rather than defined contribution plans, the separate plan structure is doomed from the start."  MORE >>

Ferenczy Benefits Law Center

Job Seekers Prefer Companies That Offer Guaranteed Lifetime Income in Retirement

"More than 70% of workers say they would choose to work for or stay with a company that offers access to guaranteed lifetime income in retirement over one that does not ... Employees say having guaranteed lifetime income offers a sense of financial security (73%), provides spending flexibility and certainty around essential expenses (72%), makes knowing how much to save for retirement easier (68%), and creates security around market volatility (66%)."  MORE >>


How to Turn Retirement Savings Into Retirement Income

"A deferred lifetime income annuity offered by an insurance company assures you'll have a guaranteed income for life, even if you live to 100 or beyond. Also called a longevity annuity, it hedges against the financial risk of living a long life.... A QLAC ... lets you allocate up to 25% of the total of all your IRAs or $135,000, whichever is less, to a QLAC and delay RMD payments until up to age 85."  MORE >>

Medical Economics

Delivering Additional Income Through Lower-Cost Products and Services Available in the Defined Contribution Industry (PDF)

12 pages. "This paper will examine the lifetime income of a hypothetical participant who saves for retirement with lower-cost funds and chooses inexpensive [decumulation] solutions in retirement. [The authors] attempt to quantify the additional retirement security that is achieved by these lower-cost investment and institutional distribution products and strategies that are now available in our DC system."  MORE >>

Institutional Retirement Income Council [IRIC]

From Auto-Enrollment to Auto-Escalation to Auto-Income: How DC Plan Defaults Can Evolve to Improve American Retirement Security (PDF)

14 pages. "Although DC plans were previously designed to serve as supplemental savings vehicles, they have evolved into the primary accumulation vehicle for many Americans' retirement savings.... [M]ost employees ... feel good about the retirement plan doing some of the work in increasing retirement savings for them through features like automatic enrollment and automatic escalation."  MORE >>

Institutional Retirement Income Council [IRIC]

Cumulative Benefits of Retirement Income Solutions in Our DC System (PDF)

13 pages. "This article seeks to summarize the primary benefits of in-plan income solutions and will break down the benefits by participants, sponsors, and the societal benefit of enhanced retirement security achieved through the adoption of guaranteed income options within our DC system."  MORE >>

Institutional Retirement Income Council [IRIC]

What the Pandemic Taught Us About Target Date Funds

"Based on a normal distribution of returns, historical data suggests a single-day decline of 12% in the equity market should almost never happen -- yet it did on 16 March [2020]. That's why factoring in these extremely rare events is imperative when selecting the qualified default investment alternative (QDIA) option -- typically a TDF -- for those nearest to, or in, retirement."  MORE >>

PLANSPONSOR; free registration may be required

Retirement Plan Committees and Inclusivity

"Make sure your committee's demographics match your employee base.... [D]efine which diversity measurements will be monitored ... Are more women participating in the plan versus men? How many participants identify with a race other than White? Which groups have lower contribution levels or higher loan usage? ... Make the numbers visible to the retirement plan committee so that all are collectively held accountable[.]"  MORE >>



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

"Increasing the availability of workplace savings plans to lower-income and part-time workers ... Encouraging plan sponsors to systematically reenroll non-participants and under-savers on a regular basis ... Providing more educational resources to plan sponsors and their partners ... Simplifying required notices ... Creating safe harbor protections for plan sponsors who have the resources to send targeted and tailored education to at-risk segments of their population."  MORE >>

Segal Benz


Proposed Changes to 5500 Reporting Won't Help 401(k) Fee Benchmarking

"Two changes would require large Form 5500 filers to report more 401(k) fee information.... [T]he Form 5500 should make it simple for plan fiduciaries and participants evaluate the reasonableness of their 401(k) fees. To do that, it must report the fee information necessary to develop reliable 401(k) fee benchmarks. Here is the additional information [the author would] like to see."  MORE >>

Employee Fiduciary


Social Security's Inadequate Cost-of-Living Adjustments

"(COLA) in place to reduce the impact of inflation on retirees' benefits, this is not usually enough to maintain the purchasing power you have had all along.... Although there have been calls to change the way the COLA is calculated, the COLA and Social Security benefits often cannot be relied upon to fund the lifestyle most retirees aim to achieve after retiring."  MORE >>

Schneider Downs

Benefits in General

Form 5500 Filings: Steps to Avoid Costly Penalties

"Plans that file under the [Delinquent Filer Voluntary Correction Program (DFVCP)] are eligible for reduced civil penalties related to late filing.... The program does not apply to plans covering only self-employed individuals or sole owners (including spouses)."  MORE >>

Withum Smith+Brown, PC

Employee Benefits Jobs

View job as Assistant Retirement Plan/HR Administrator
for Columbia Benefits, LLC Assistant Retirement Plan/HR Administrator

Columbia Benefits, LLC

Remote / Denver CO

View job as Financial Analyst (Pathways, Recent Graduate)
for Pension Benefit Guaranty Corporation [PBGC] Financial Analyst (Pathways, Recent Graduate)

Pension Benefit Guaranty Corporation [PBGC]

Remote / Washington DC

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

Associated Pension Consultants

Chico CA / Sacramento CA

View job as Plan Administrator
for Retirement Plan Specialists, Inc. Plan Administrator

Retirement Plan Specialists, Inc.

Remote / Oviedo FL

Selected New Discussions

Deadline for Non-Profit Sponsor's Contribution to a Profit Sharing Plan?

"What's the due date for the deposit of a profit sharing contribution by a non-profit? They are exempt from filing Form 990 or 1120."

BenefitsLink Message Boards

Solo K for Sole Proprietor -- Computation of Contributions Based on Earned Income

"The IRS recently issued a TE/GE Issue Snapshot entitled 'Calculation of Plan Compensation for Sole Proprietorships.' My question is, assuming that the proprietor's net income from self-employment is equal to $100,000 for 2021 and s/he has established a solo 401(k) for 2021, how do you calculate the elective deferrals?"

BenefitsLink Message Boards

5-Year Period Starts Anew After Rolling from Roth 401(k) to Roth IRA?

"I am 62 and retired. I have a Roth 401(k) which has satisfied the five year period for taking tax-free earnings. I plan to roll this Roth 401(k) account into a Roth IRA. Does the five year period start anew?"

BenefitsLink Message Boards

Rollover of 457(b) Plan's Death Benefit?

"Tax-exempt organization's CEO died while still in service. Two children as beneficiaries. I believe no required federal withholding on the beneficiary distributions and no rollovers allowed, but could be transferred to another tax-exempt 457(b) plan of beneficiary (if it exists) without any tax. Correct?"

BenefitsLink Message Boards

New Trustee Wants Rabbi Trust to Get an EIN -- Jeopardizes Unfunded Status?

"We recently moved from one trustee to another. The old trustee did not require us to get a separate EIN for the rabbi trust. The new trustee does, saying a separate EIN is needed to file a Form 1041. Is this a concern?"

BenefitsLink Message Boards

Press Releases

Empower Retirement Seeks to Bolster Expansion with New Hires

Empower Retirement

Realogy Adds Industry-First Retirement Plan Offering to Exclusive Benefits Program for All Realogy Affiliated Real Estate Agents


NFP Acquires FindMyBenefits, Further Expanding Employee Benefits Business

NFP Corp.

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

What You Should Know About: Defined Benefit Plans


IRS [Internal Revenue Service]

Virtual Fall 2021 Policy Conference

October 5, 2021 WEBCAST

ERIC [ERISA Industry Committee]

Major Retirement Reform Looming

October 6, 2021 WEBCAST

Convergent Retirement Plan Solutions

2021 Regulatory Roundtable: Top of Mind Regulatory, Legislative, and Litigation Updates

October 7, 2021 WEBCAST

Multnomah Group

Auditors' Perspective

November 10, 2021 WEBCAST

Conference of Consulting Actuaries

Last Issue's Most Popular Items

Strategies for Roth IRAs


Who Is Liable for TPA or Recordkeeper Mistakes?

Society for Human Resource Management [SHRM]; membership may be required to view article

Text of IRS Proposed Regs and Hearing Notice: Enrolled Agent Special Enrollment Examination and the ERPA Special Enrollment Examination

Internal Revenue Service [IRS]

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

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