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Retirement Plans Newsletter

July 20, 2022

3 New Job Opportunities 3 New Job Opportunities

 

[Guidance Overview]

PBGC Issues Final Regs for Multiemployer Plans Applying for Special Financial Assistance

"Under the final regulation, separate prescribed interest rates apply to the plan's existing assets and the SFA.... The final regulation ... significantly expands the ability of plans to invest SFA in securities other than investment-grade corporate bonds, allowing up to 33% of SFA to be invested in 'return-seeking assets' (RSAs).... [T]he final rule conditions receipt of SFA on a plan phasing-in the recognition of the SFA over time for purposes of calculating withdrawal liability."  MORE >>

Groom Law Group

[Guidance Overview]

PBGC's Final Rule for Multiemployer Pension Rescue Includes Key Changes

"[T]he changes will result in higher amounts of financial assistance for many plans and should make it more likely that plans receiving assistance will stay solvent through at least 2051 as ARPA intended.... [1] Amount of assistance ... [2] Investment return assumption ... [3] MPRA conundrum ... [4] Permissible investments ... [5] Withdrawal liability."  MORE >>

Proskauer

[Guidance Overview]

Alert (High Risk Issue) icon DOL's Rules on Rollover Advice Now Fully in Effect

"While aspects of the rule were already in effect, now advisors must also provide the mandated written explanation to rollover clients of the specific reasons as to why the investment professional and/or financial institution believe that the rollover is in the client's best interest, or else face substantial potential liability. This exposure is likely to trigger coverage under professional liability (E&O) policies, as opposed to fiduciary liability policies which protect plan sponsors."  MORE >>

Willis Towers Watson

[Guidance Overview]

Hawaii to Establish Unique Retirement Program

"Gov. David Ige (D) signed legislation creating the program into law on July 12. It went into effect immediately. The program has two unique features.... In order to participate in the program, employees will have to opt in. And unlike any other state so far, one of the members of the board that will administer the program will be a retiree living in Hawaii, to represent retirees."  MORE >>

American Retirement Association [ARA]

[Guidance Overview]

Alert (High Risk Issue) icon Mandatory Withholding on Annuities and Pensions for Financial Institutions Operating in Minnesota

"Effective January 1, 2022, financial institutions operating in Minnesota are required to begin withholding Minnesota Personal Income Tax on annuity and pension payments made to any of its customers that reside in Minnesota.... If a financial institution has nexus in Minnesota but has not withheld Tax on pension and annuity distributions after January 1, 2022, it could be liable for up to the full amount of the Tax that should have been withheld, together with a penalty for failure to timely withhold and remit Tax."  MORE >>

Hunton Andrews Kurth LLP

Retirement Plan Correction Solution: The Acquisition Apocalypse

"Even though the law and the plan terms may permit the exclusion of an acquired company's employees during the transition period, the plan must meet all the coverage and nondiscrimination rules after that period ends. Changing plans and their design isn't necessarily an easy thing, so preplanning is required."  MORE >>

Ferenczy Benefits Law Center

Administrative Policies Every 401(k) Plan Needs

"[1] Loan policy ... [2] QDRO procedures ... [3] Cybersecurity policy and procedures ... [4] Missing participant and uncashed check procedures ... [5] Investment policy."  MORE >>

Foley & Lardner LLP

Preparing for Your 401(k) to Lose Solo Status

"[It's] common for business owners to wait too long to notify their 401(k) provider that a common law employee has met their solo plan's age and service eligibility requirements.... This delay can lead to steep consequences[.]"  MORE >>

Employee Fiduciary

How to Get New 401(k) Leads in Your Pipeline

"47% of advisors surveyed cited networking as the most effective prospecting method. This was followed by social meetings or luncheons at 38%. Third was CPA relationships at 35%. Then educational seminars or speaking engagements -- that got 32% of the vote."  MORE >>

401k Best Practice Blog

Washington Is Only State with 100%-Plus Funded Pensions

"[A recent study] finds total unfunded liabilities for state-run pension systems across the country would rise to $1.3 trillion assuming a -6% rate of return for the fiscal year.... Even with a rate of return of -6% and -12%, Washington's public pension system would still be funded at a rate of 107% and 101%, respectively[.]"  MORE >>

Whatcom News

The State of Public Pension Funding, 2022

"Equable estimates the aggregate 2022 funded ratio will decline to 77.9% and aggregate unfunded liabilities will increase to $1.4 trillion -- the largest single-year decline in funded ratio since the Great Recession. The good news is that the net trend between 2019 and 2022 is still positive, with improved funded status. The bad news is that the state of pensions in America is still fragile."  MORE >>

Equable

An Overview of State Hybrid Retirement Plans (PDF)

13 pages; rev. Jul. 2022. "Hybrid plans have been in place in public sector retirement systems for decades, and they have received increased attention in recent years ... While most states have chosen to retain their defined benefit (DB) plan by modifying required employer and employee contributions, restructuring benefits, or both, some states have looked to hybrid plans as retirement benefit policy solutions."  MORE >>

National Association of State Retirement Administrators [NASRA]

Employee Benefits Jobs

View job as Internal Sales and Marketing Assistant
          for Atlantic Pension Services Inc. Internal Sales and Marketing Assistant

Atlantic Pension Services Inc.

Remote / Kennett Square PA / DE / MD / NJ

View job as Internal Sales and Marketing Assistant
          for Atlantic Pension Services Inc.

View job as Senior Pension Consultant
          for The Ryding Company Senior Pension Consultant

The Ryding Company

Remote / CA / HI / NC / NY / PA / TX / UT

View job as Senior Pension Consultant
          for The Ryding Company

View job as Plan Administrator
          for American Pension LLC Plan Administrator

American Pension LLC

Berkeley Heights NJ

View job as Plan Administrator
          for American Pension LLC

Selected New Discussions

Audit Needed for Plan Having More Than 100 Participants But Zero Assets?

"Company establishes profit sharing plan (not a 401k) in 2020. 90 participants beginning of year. Makes no contribution for 2020, so $0 in assets. No 5500 filed. As of 1/1/21, there are now 130 participants. No contribution to be made for 2021, so still $0 in assets. If they were to file a Form 5500, they're subject to audit. Doesn't want to file a Form 5500 because there are no assets. Comments? What would the auditor audit?"

BenefitsLink Message Boards

Gross Pay Insufficient to Deduct Full Amount of Elected 401(k) Deferrals

"What happens if an employee's gross pay for a pay period is insufficient to cover the employee's salary deferrals and they are therefore not deducted in accordance with the employee's election? Is this a plan failure? I recognize this would be a rare occurrence, but think it's possible in a scenario where an employee has fixed $$ deductions that take precedence over benefits (i.e., child support, wage garnishments)."

BenefitsLink Message Boards

Press Releases

SPARK Institute Congratulates Ralph Ferraro on His Appointment to Head of Retirement Plan Services at Lincoln Financial Group

SPARK Institute

OneDigital Strengthens Integrated Offerings with Addition of IntoBenefits, Inc. in Silicon Valley

OneDigital

T. Rowe Price Announces Addition of Two Senior Executives to Institutional Defined Contribution Business in U.S.

T. Rowe Price

Last Issue's Most Popular Items

IRS Offers Novel Retirement Plan Correction Opportunity

Seyfarth

IRS Introduces 90-Day Audit Program

Bolton

Recent Trends in the Average Retirement Age

Center for Retirement Research at Boston College

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

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