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Retirement Plans Newsletter

December 16, 2021

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[Official Guidance]

Text of IRS Notice 2022-02: Weighted Average Interest Rates, Yield Curves, and Segment Rates for December 2021 (PDF)

"This notice provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates ... and the 24-month average segment rates ... [as well as] the interest rate on 30-year Treasury securities ... as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate[.]"  MORE >>

Internal Revenue Service [IRS]

Retirement Plans Are Looking More SECURE

"[N]early 90 percent of eligible participants made contributions to [their] plan in 2020 ... More than a third (36.5 percent) of plans now have an auto-escalation cap greater than ten percent of pay ... [W]hile the average company contribution slipped to 4.9 percent of pay, it was still higher than it was four years ago. And, though more than 90 percent of plans now allow hardship withdrawals, only a small fraction -- 2.6 percent of participants -- took one in 2020."  MORE >>

Plan Sponsor Council of America [PSCA]

Delta Air Lines Faces Actuarial Equivalence Lawsuit

"The complaint challenges the use of both allegedly outdated mortality tables and artificially high interest rate assumptions in the conversion of annuity types under multiple pension plans." [DuVaney v. Delta Airlines Inc., No. 21-2186 (D. Nev. complaint filed Dec. 10, 2021)]  MORE >>


Self-Correcting a Failure to Enroll a New Employee in Our Automatic 401(k) Contributions

"The standard method for correcting full-year elective deferral failures (including enrollment failures under an automatic contribution arrangement) involves making a qualified nonelective contribution (QNEC) for 50% of the missed deferrals plus a contribution for the full amount of any missed matching or nonelective contributions. But lower-cost methods may be available if the correction is made within specified timeframes."  MORE >>

Thomson Reuters / EBIA

Would 401(k) Participants Use a Social Security 'Bridge' Option?

"The bridge option would use 401(k) assets to pay retirees an amount equivalent to their Social Security benefits so they can postpone claiming benefits, thereby increasing their monthly payment when they do eventually claim.... [This study indicates] that a substantial minority (up to about one-third) of respondents would use the bridge ... [F]raming increases the share of assets allocated to the bridge strategy [and] defaulting workers into the strategy is even more effective."  MORE >>

Center for Retirement Research at Boston College

School District 403(b) Plans and Recordkeeper Selection

"[A California] school district or charter school can indeed establish its employer-sponsored 403(b) plan utilizing a single provider or Recordkeeper as long as it makes the selection in a rational and fiduciary-wise manner."  MORE >>

Best Best & Krieger LLP

Executive Compensation and Nonqualified Plans

McDonald's Secures $105 Million Clawback from Former CEO

"The settlement with Steve Easterbrook, who was ousted in 2019 for an inappropriate relationship, is one of the largest ever clawbacks of executive compensation."  MORE >>

The New York Times; subscription required

Employee Benefits Jobs

View job as Defined Contribution Administrator
for Pension Kinetics, Inc. Defined Contribution Administrator

Pension Kinetics, Inc.

Remote / Westminster CA

Selected New Discussions

Can All Further Loans Be Prohibited While There Exists One or More Outstanding Loans?

"Employer hates loans and wants to stop offering them. Does he need to wait until all outstanding loans have been paid off, or are those loans fine retaining the loan policy in place at the time of the promissory note?"

BenefitsLink Message Boards

Adult Stepdaughters Become HCEs Due to Attribution from Stepfather? What If Legally Adopted?

"100% owner Joe marries Jane, who has 2 adult children from prior marriage (ignore the 1 year rule). Joe refers to them as his step-daughters. Jane and her 2 daughters work for Joe's company. Jane is an HCE by attribution. How about the daughters? In one case, assume they're adopted by Joe. In another case, assume they are not adopted by Joe."

BenefitsLink Message Boards

Wanna Party (or Defer, at Least) Like It's 2099?

"We had a participant who meant to defer his compensation until 2022, but he accidentally entered 2099 on the form. This was clearly a mistake, as he will be well over 150 years old in 2099. I know of no way to accelerate payments once the schedule is set (outside those listed in the regs, which we've already ruled out or otherwise explored), but are there any exceptions where an election was clearly, on its face, a mistake?"

BenefitsLink Message Boards

Press Releases

Custodia Financial and Its Retirement Loan Eraser Program Announce DE&I Certification

Custodia Financial

OneDigital Acquires Benemax


Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Controlled Group and Successor Liability for Underfunded Defined Benefit Pension Plan Liabilities in Asset Sales: Best Practices for ERISA Counsel

February 9, 2022 WEBCAST


Fundamentals of Qualified Retirement Plans for 2022 - Session 5

March 24, 2022 WEBCAST


Last Issue's Most Popular Items

The Truth About After-Tax Contributions


Nonqualified Deferred Compensation and the Special Timing Rule for FICA Tax Purposes

Verrill Dana LLP

New Auditing Standard: SAS 136 Will Impact Employee Benefit Plan Audits

Meaden & Moore

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

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