"Plan sponsors of 401(k) plans should track hours for part-time employees starting with plan years beginning in 2021 (in 2023 for ERISA-covered 403(b) plans) or consider using an equivalency if the hours are not available. Part-time employees will enter a 401(k) plan in the 2024 plan year based on the three-year requirement of the SECURE Act. For 2025 and later years they will enter the plan (whether a 401(k) or ERISA-covered 403(b) plan) based on the two-year requirement of the SECURE 2.0 Act."  MORE >>

"Plan sponsors with a large population of lower-paid employees may want to consider [pension-linked emergency savings account (PLESAs)] since this option may incent such employees to start or continue contributing to the plan ... Plan sponsors with low plan participation rates may want to consider PLESAs ... as a tool to increase participation.... Given the ambiguity of its application to non-ERISA plans, plan sponsors of church and governmental plans should wait for additional guidance or clarification on whether a PLESA can be added to their plans."  MORE >>

"The final rule posted in the Federal Register removes employees of the plan sponsor not actively participating, but eligible to participate.... The rule change would keep around 18,699 defined contribution plans from having to be considered large and which would be required to have the more expanded large plan filing requirements, including a costly audit from being incurred."  MORE >>

"Although the expansion of the ability to self-correct is welcome news for many plan sponsors, there is still a need for additional clarity and guidance. The changes to EPCRS appear to be effective on the enactment on SECURE 2.0. The IRS will have two years to update Revenue Procedure 2021-30 to reflect the statutory changes and possibly provide additional guidance."  MORE >>

"[T]he updates that SECURE 2.0 brings will affect plan participation, increase retirement savings and increase ease of withdrawals, but add a layer of complexity to plan recordkeeping."  MORE >>

"Defined contribution plans would have to use these funds within 12 months after the end of the plan year in which the forfeiture arose. A transition rule would apply to forfeitures arising before the regulation's effective date. The regulation would also better reflect the way the defined benefit plan funding rules implicitly reflect forfeitures in determining minimum required contributions. The proposed rule would take effect for the 2024 plan year, but sponsors and plan administrators may rely on the proposal immediately."  MORE >>

"[T]he court flatly rejected Northwestern's contention that a plaintiff was required to rule out every possible innocent explanation for a fiduciary's conduct.Moreover, in a 'newly formulated pleading standard,' the court held that where 'alternative inferences are in equipoise' in the sense that they are equally reasonable, the court must resolve the matter in favor of the plaintiffs. This means that it is enough if the plaintiffs plead that a prudent course of action might have been available rather than proving it actually was." [Hughes v. Northwestern Univ., No. 18-2569 (7th Cir. Mar. 23, 2023)]  MORE >>

"The good news is that the IRS does not consider that the failure to timely restate the plan will itself disqualify it from favorable tax treatment. The not-so-good news is that the failure transforms that pre-approved plan into an individually designed plan upon which the employer can no longer rely as a qualified plan."  MORE >>

"BenchMine [is] billed as the first-ever 401(k) comparative analysis tool that's free and open to the public. Plan advisors (and anyone else for that matter) can search through more than 56,000 plans with at least $1 million in total assets nationwide to see how particular company 401(k) plans stack up in their city, region, against a competitor or within a specific industry -- and show them exactly where the plan excels and/or falls short in terms of average fees, contributions, performance, etc."  MORE >>

"Market depreciation drove a roughly 14% drop in target-date-fund assets in 2022 to $2.82 trillion ... The decline came off a record year for TDFs in 2021, when the investment vehicles popular in retirement plans hit a record high $3.27 trillion ... Despite the market challenges, net inflows for TDFs remained strong at $153 billion for the year, down from $170 billion in 2021[.]"  MORE >>

"Although echoed by some policymakers, claims of Social Security's impending 'bankruptcy' are highly misleading and demonstrate misunderstanding, or deliberate misrepresentation, of Social Security's finances."  MORE >>

"The final regulations: [1] reduce the 250-return filing threshold to generally require electronic filing by filers of 10 or more returns in a calendar year.... [2] require filers to aggregate almost all information return types covered by the regulation to determine whether a filer meets the 10-return threshold ... [3] permit waivers for filers that would experience hardship in complying with the e-filing requirements.... [T]he hardship waiver is not applicable to Form 5500 filings."  MORE >>

"[M]ost companies will have to confront the obvious question about whether they should defer a portion of officer compensation for a period sufficient to facilitate a clawback in the event the officer terminates employment. Companies wishing to adopt this approach must resolve certain issues first."  MORE >>