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Retirement Plans Newsletter

December 19, 2022

2 New Job Opportunities 2 New Job Opportunities

 

Administration Issues for Terminating Retirement Plans

"Participant data and benefit calculations ... [M]essaging around the plan termination ... [P]articipants must receive a bewildering array of other notices ... [M]ost plan sponsors set up a series of meetings for participants ... Each returned election form must be carefully reviewed ... [D]etails of all of the benefit distributions must be compiled[.]"  MORE >>

Milliman

Best Practices for Applying for Special Financial Assistance (SFA)

"Apply sooner than later ... Bring together the right team ... Partner with the PBGC ... Ensure your participant information is accurate."  MORE >>

PBI Research Services

2023 Lump Sums from Defined Benefit Plans Will Be Much Lower Than Previously Predicted

"[T]he Federal Reserve has once again increased its benchmark federal funds rate in an effort to stave off the result of historically high inflation. As a result, the one-year increase in the segment rates used to calculate lump sums is potentially the largest increase over any previous 12-month period."  MORE >>

Milliman

ROBS Exit Strategies, Part 1: Options for Divesting the Plan of Stock Ownership

"The applicable plan rules provide three general ways to get the stock out of the plan ... [1] Reverse the original ROBS investment through a cash redemption; [2] Distribute the QES directly to the plan participant; or [3] Sell the entire company to a third-party buyer. [Each path results] in different income tax consequences for the corporation and the ROBS owner."  MORE >>

KLB Benefits Law Group

America's Youngest Adults Plan to Retire Earlier Than Any Generation Before Them

"Americans between the ages of 18 and 25 -- known as Gen Z -- were the most likely to build savings during the pandemic and begin working with an advisor.... Seven in 10 (70%) adults from the age group reported higher savings over that time period. They were also more likely to seek professional financial help, with nearly three in 10 (29%) saying they did not have an advisor before the pandemic but have either started working with one or plan to moving forward. Despite that, close to 75% of Gen Z adults said their financial planning needs improvement."  MORE >>

Northwestern Mutual

CRS Report: Income for the Population Aged 65 and Older

38 pages. "Older Americans receive income from public programs such as Social Security and Supplemental Security Income, earnings, pensions and retirement savings, asset income, and others. This report addresses the number and proportion of aged individuals who received household income from each source and the amount received, using the 2018 Health and Retirement Study (HRS) linked with administrative data from the Social Security Administration (SSA). Income reflects the annual amount received in 2017." [R47341, Dec. 16, 2022]  MORE >>

Congressional Research Service [CRS]

Benefits in General

[Official Guidance]

Text of IRS Disaster Relief Notice Fl-2022-20, for Florida Victims of Hurricane Nicole

"Victims of Hurricane Nicole beginning November 7, 2022, now have until March 15, 2023, to file various individual and business tax returns and make tax payments ... individuals and households affected by Hurricane Nicole that reside or have a business in Brevard, Duval, Flagler, Indian River, Lake, Martin, Nassau, Palm Beach, Putnam, St. Johns, St. Lucie, and Volusia counties qualify for tax relief."  MORE >>

Internal Revenue Service [IRS]

Employee Benefits Jobs

View job as Retirement Plan Administrator
            for Retirement Solutions Specialists, LLC

Retirement Plan Administrator

Retirement Solutions Specialists, LLC

Remote / Jacksonville FL

View job as Retirement Plan Administrator for Retirement Solutions Specialists, LLC

View job as 401k & Defined Contribution Plan Consultant
            for Planned Retirement Consultant & Administrators, LLC

401k & Defined Contribution Plan Consultant

Planned Retirement Consultant & Administrators, LLC

Remote / Ridgewood NJ

View job as 401k & Defined Contribution Plan Consultant for Planned Retirement Consultant & Administrators, LLC

Selected New Discussions

Is It Feasible for a Recordkeeper to Accept Distribution Elections Over the Phone?

"Would it be feasible under ERISA/the Code for service provider to design a process to allow qualified plan participants to elect distributions over the phone without completing a form of any kind? In other words, call center reps would orally guide participants through the election process, complete the online payment distribution form on behalf of the participant while they're on the call, and enter their choices in to our system. Totally verbal. It's the call center rep that's completing/submitting the election, and the participant is doing everything over the phone.

"Assume, for the sake of argument, that (1) we could authenticate the caller (2) the call would be on a recorded line and would be scripted, (3) the plan document doesn't say anything specifically requiring a written election, and (4) we would have a separate process to obtain spousal consents or other documents that required a notarized signature."

BenefitsLink Message Boards

When Is W-4R Necessary for Lump Sum Distribution?

"Lets assume a lump-sum distribution, rollover eligible. If a participant requests a distribution from a plan and completes a distribution form that includes a section where he/she can elect the withholding that they want to apply, is it also necessary that the participant complete a W-4R? Along the same lines, I have seen some TPAs use a distribution form that has an election to pay the participant 'In a single payment of my entire account balance, less required 20% withholding'. If the person chooses that election, do they also need to complete a W-4R form?"

BenefitsLink Message Boards

Are Employees with Zero Compensation Included for Testing Purposes?

"I thought there was some guidance that zero compensation employees were not to be included in testing. That's the way I've been handling it for over 20 years working at a number of TPAs. However, my new employer has a policy to include zero compensation participants in coverage testing (but not in ADP/ACP). We're having a substantial number of plans failing coverage as a result (even safe harbor contributions).... Is there any on-line resource that has some level of definitive guidance on the subject?"

BenefitsLink Message Boards

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

SECURE 2.0, or Whatever Acronym They Pick

January 13, 2023 WEBCAST

ERISApedia.com

Fall 2022 Employee Benefits Briefing

December 16, 2023 WEBCAST

Nixon Peabody LLP

Last Issue's Most Popular Items

Text of IRS Notice 2023-05: Weighted Average Interest Rates, Yield Curves, and Segment Rates for December 2022 (PDF)

Internal Revenue Service [IRS]

A Plan Sponsor's Duty to Search for 'Missing' Participants

Newport Group

District Court Voids ERISA Plan's Arbitration Provision

Proskauer

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

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