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Retirement Plans Newsletter

February 18, 2022

4 New Job Opportunities 4 New Job Opportunities


[Guidance Overview]

PBGC Updates Selection Criteria for Standard Termination Audits

"The PBGC's Standard Terminations Q&A states that plans with a participant count of more than 1,050 are selected for audit. Plans with less than 1,050 participants may be randomly selected for audit. Further, plans may be selected for audit if the PBGC has reason to believe that there is a problem or if all plan assets were distributed without filing a Standard Termination Notice (PBGC Form 500)."  MORE >>


[Guidance Overview]

Form 8950 and Instructions Updated for Pre-Submission Conference Requests Under VCP

"[T]he guidance about what to put in a pre-submission conference request remains, perhaps necessarily, broad and non-specific. Representatives requesting conferences will therefore need to think carefully about what to include in their requests. Include too little, and submitters risk receiving advice that is less reliable because it did not take all relevant factors into account. Include too much, and it might prompt the IRS to exercise its discretion to decline the conference[.]"  MORE >>

Thomson Reuters / EBIA

[Guidance Overview]

IRS Issues Revised 2022 Form W-4P and New Form W-4R

"Beginning in 2022, administrators will now send the redesigned Form W-4P only to participants receiving periodic pension or annuity payments. Administrators will send Form W-4R to participants receiving nonperiodic payments or eligible rollover distributions. This is a change from prior years, when administrators also sent Form W-4P for these types of distributions."  MORE >>


[Guidance Overview]

DOL Digs Deeper Into Climate Change Impact on Retirement Plans

"DOL asks whether it should collect data on climate-related financial risk for ERISA plans, and if so, what kind of information, where it may be found, and how DOL should collect it.... For ERISA fiduciaries, the RFI includes questions on the sources of information for evaluating climate-related financial risks when making investment decisions."  MORE >>


Ninth Circuit: 'Highest Contribution Rate' for Withdrawal Liability Calculations Excludes PPA Surcharges

"In affirming the lower court's findings, the Ninth Circuit looked to the statutory language and determined that the surcharge was not a 'contribution rate' because the PPA surcharge is calculated and paid after the total amount of contributions have been calculated. In doing so, the court agreed with a similar opinion from the Third Circuit from 2015[.]" [Bd. of Trustees of the Western States Office & Professional Employees Pension Fund v. Welfare & Pension Admin. Serv., Inc., No. 20-35545 (9th Cir. Jan. 31, 2022)]  MORE >>


Target Date Fund Performance Litigation: Advice for Plan Fiduciaries

"[C]arefully consider the glide paths employed by the target date funds, and how the funds will be managed in terms of asset allocation and risk tolerance.... Subsequently, when ... examining the plan's target date fund performance over time, be certain to take into consideration the funds' glide paths, asset allocations and risk tolerances."  MORE >>

Squire Patton Boggs

Multiemployer Pension Funding Study, December 2021

"Strong investment performance during 2021 led to an aggregate funded percentage for all multiemployer plans of 91% as of December 31, 2021, up from 88% at the end of 2020.... The average discount rate is now below 7.0%.... 80% of plans are at least 80% funded, and over half of all plans are 100% funded or better. To date, five plans in critical and declining status have received [PBGC] approval for $992 million in special financial assistance (SFA) under [ARPA]."  MORE >>



It's Back: The Norcross-Walberg Bill to Make Annuities an Allowable 401(k) Default

"Any deferred annuity includes the option to convert the contract assets to a lifetime income stream. But only certain annuities are sold or used specifically for lifetime income. [The Lifetime Income For Employees Act (HR 6746)] doesn't appear to recognize that distinction. Also it remains to be seen whether plan sponsors will be comfortable defaulting their clients into an irrevocable or illiquid product."  MORE >>

Retirement Income Journal


RIAs, 401(k)s, and Individual Annuities: Is This the Future?

"A number of life insurers want an opportunity to market individual annuities to 401(k) participants. Asset managers that currently sell mutual funds through 401(k) plans think that plan participants who buy annuities might keep the rest of their money in the plans indefinitely. There are some potentially misaligned interests here."  MORE >>

Retirement Income Journal

Executive Compensation and Nonqualified Plans

Second Circuit Finds Severance Plan's Intended Compliance with 409A Allows Denial of Benefits to Employee Terminated Due to Disability

"The court explained that Section 409A of the Internal Revenue Code defines 'involuntary' 'termination of employment' as occurring when an employee who was willing and able to continue performing services is terminated by the employer's unilateral authority. Soto was not able to continue performing services because of disability. The severance plan requires compliance with Section 409A so the Plan Administrator acted reasonably in selecting an interpretation of 'Layoff' consistent with this section." [Soto v. Disney Severance Pay Plan, No. 20-4081 (2d Cir. Feb. 16, 2022)]  MORE >>

Roberts Disability Law

409A Checklist for Employment Agreements

"It has been over 15 years since Congress enacted Internal Revenue Code Section 409A, and compliance has become generally routine for traditional deferred compensation and other non-qualified plans. Most mistakes tend to arise when no one thinks to involve 409A experts for employment agreements, releases, settlement agreements, and severance payouts. Here is a checklist by which to preview employment-related agreements for potential 409A violations."  MORE >>

The Wagner Law Group

Employee Benefits Jobs

View job as Relationship Manager
for The Retirement Plan Company (TRPC)/an ABG firm Relationship Manager

The Retirement Plan Company (TRPC)/an ABG firm


View job as Relationship Manager
for The Retirement Plan Company (TRPC)/an ABG firm

View job as Client Coordinator – Compliance Services
for The Retirement Plan Company (TRPC)/an ABG firm Client Coordinator – Compliance Services

The Retirement Plan Company (TRPC)/an ABG firm


View job as Client Coordinator – Compliance Services
for The Retirement Plan Company (TRPC)/an ABG firm

View job as Vice President, Retirement Dept.
for National Benefit Services, LLC Vice President, Retirement Dept.

National Benefit Services, LLC

Remote / West Jordan UT

View job as Senior Retirement Analyst
for Dunbar, Bender & Zapf, Inc. Senior Retirement Analyst

Dunbar, Bender & Zapf, Inc.

Remote / Pittsburgh PA

Selected New Discussions

Missed Opportunity for Deferrals and for Roth Contributions; Separate QNECs Required by Rev. Proc. 2021-30?

"I work for a TPA firm. We have a client who missed offering its 401(k) plan to one eligible employee for 2021 and will be making a QNEC for the missed deferral opportunity under Rev. Proc. 2021-30. The client's 401(k) plan permits pre-tax deferrals, Roth contributions, and catch-up contributions. It is a deferral-only plan so does not have a matching contribution. Does Rev. Proc. 2021-30 require a QNEC for the pre-tax contribution and another QNEC for the Roth contribution?"

BenefitsLink Message Boards

Two Days Late on 5500 Filing Means $500 Penalty? Ouch!

"The late filing penalty for the 5500s used to be $25 per day. It seems that was increased to $250 per day. True, there is the DFVCP that caps the penalty at $750 but, if someone files a day or two late, the penalty is $500 -- is that correct? What if the return was on extension but still was filed late?"

BenefitsLink Message Boards

Timing of HCE-to-Non-HCE Status of Daughter-Participant When Dad Sells His Ownership Interest in Plan Sponsor

"Company is owned by dad and son 50/50. Company employs mom and daughter (son's sister). All above are HCEs for 2021. On March 1, 2022, dad sell his portion to son, so son becomes 100% owner. When does sister become a non-HCE?"

BenefitsLink Message Boards

Press Releases

Morningstar Investment Management and Hueler Income Solutions Offer Integrated Lifetime Income Service

Morningstar, Inc.

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Tight Labor Market’s Impact on Retirement Plan Design


CAPTRUST Financial Advisors

Key ERISA Fee and Investment Litigation Developments and the Impact of Hughes v. Northwestern University



IRA Changes: Stay Compliant in 2022

March 1, 2022 WEBCAST

Convergent Retirement Plan Solutions

Preventing Tax-Return Errors with Stock Comp and Stock Sales

March 3, 2022 WEBCAST

2022 ERISA Fiduciary Duty Litigation: SCOTUS Ruling in Hughes v. Northwestern University, Strategies for Counsel

April 13, 2022 WEBCAST


Last Issue's Most Popular Items

Text of IRS Notice 2022-09: Weighted Average Interest Rates, Yield Curves, and Segment Rates for February 2022 (PDF)

Internal Revenue Service [IRS]

Hughes v. Northwestern University: Lessons for Retirement Committees and Other Fiduciaries


Pension Trustees Responsible for Actions of Employees Who Were Instructed to Be Evasive and Misleading

Kantor & Kantor

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

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