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Retirement Plans Newsletter

April 4, 2023


[Official Guidance]

Text of IRS Publication 939: General Rule for Pensions and Annuities (PDF)

85 pages; rev. Dec. 2022, pub. Mar. 10, 2023. "Reminders: ... [1] In tax years prior to 2018, user fees were allowed as miscellaneous itemized deductions subject to 2%-of-adjusted-gross-income (AGI) limit. However, under the Tax Cuts and Jobs Acts (TCJA), miscellaneous itemized deductions are suspended for tax years 2018 through 2025, and therefore user fees aren't allowed for tax years beginning after 2017 and before 2026.... [2] Distributions from an annuity under a nonqualified plan are considered net investment income for the purpose of figuring the NIIT."  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Text of IRS Publication 590-A: Contributions to Individual Retirement Arrangements (IRAs) (PDF)

61 pages, rev. Apr. 3, 2023. "What's New for 2022: [1] Qualified disaster tax relief.... [2] Certain corrective distributions not subject to 10% early distribution tax.... [3] Statute of limitations rules changed for IRAs.... [4] Modified AGI limit for traditional IRA contributions.... [5] Modified AGI limit for Roth IRA contributions.... What's New for 2023: [1] IRA contribution limit increased.... [2] Increase in required minimum distribution (RMD) age.... [3] Modified AGI limit for traditional IRA contributions increased.... [4] Modified AGI limit for Roth IRA contributions increased."  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

Employers: Are You Ready for the New LTPT Employee Rules? (PDF)

" [A]ll recordkeeping, valuation and compliance testing system providers must update their software to properly reflect the LTPT employee requirements included in the two SECURE Acts. This will include updates to eligibility, allocation, vesting and compliance testing calculations, plus all system validations, reports and reconciliations.... [I]mplementation of these enhancements requires thoughtful planning so as to create the least amount of disruption to users' continued operation of their plans."  MORE >>

ASC, via Plan Consultant

Northwestern University's Alternative Explanations Not Strong Enough to Defeat ERISA Excessive Fee Claims

"[T]he Seventh Circuit's ruling appears to be an unfortunate development for plan sponsors and fiduciaries and arguably stands in stark contrast to the recent trend of circuit court opinions dismissing many of these claims." [Hughes v. Northwestern Univ., No. 18-2569 (7th Cir. Mar. 23, 2023)]   MORE >>


How Plan Sponsors Can Offer Backdoor Roth Conversions

"In addition to offering Roth accounts, ... plan sponsors must allow after-tax contributions to their employer-sponsored retirement plan, as well as in-plan Roth conversions, in order for the backdoor conversion to be possible.... When plan sponsors are first hiring a recordkeeper or moving to a new recordkeeper ... it is important that they discuss the backdoor Roth option during conversations about plan features and design elements. "  MORE >>

PLANSPONSOR; free registration may be required


2023NAFE: Virtual Conference for TPA Professionals

Join us April 23-25 for the premier industry event for TPA professionals! With virtual participation options & 50+ breakouts across 4 tracks, you’ll find insights you need to move your business forward. Register today!

Sponsored by NIPA {National Institute of Pension Administrators]

Financial Wellness Programs Can Boost the Bottom Line

"Employers who promote financial wellness programs can reap tangible gains in employee focus and productivity. Mandated education on budgeting, debt management and building emergency savings shouldn't be considered an expense or loss of productive time, but an investment in worker wellbeing that will have a long-term impact on the bottom line."  MORE >>

HUB International

Adviser Group Forecasts Federal, Private Plan 'Battle' Over U.S. Retirement System

"A government-led plan threatens private 401(k) industry, NAPA head tells national conference. A think tank proponent says the plan focuses on left-behind workers and would pair well with current system."  MORE >>


U.S. Corporate Pension Plans Funding Status, March 2023

"The aggregate funded ratio for U.S. corporate pension plans decreased by an estimated 0.6 percentage points month-over-month in March to end the month at 99.1% ... The monthly change in funded ratio resulted from a 3.4% increase in liability value partially offset by a 2.7% increase in asset value."  MORE >>

Wilshire Associates

FAS87 ASC715 Discount Rates and Moody's Rates, March 31, 2023

An unofficial monthly report of the Moody"s Daily Long-term Corporate Bond Yield Averages and Moody"s Daily Treasury Yield Averages (used as benchmarks by some corporate pension plans).  MORE >>

BenefitsLink Message Boards

Benefits in General

[Official Guidance]

Text of IRS Disaster Relief Notice Ar-2023-01, for Victims of Severe Storms and Tornadoes in Arkansas

"Victims of severe storms and tornadoes in Arkansas on March 31, 2023, now have until July 31, 2023, to file various individual and business tax returns and make tax payments ... [I]ndividuals and households affected by severe storms and tornadoes that reside or have a business in Cross, Lonoke, and Pulaski counties qualify for tax relief."  MORE >>

Internal Revenue Service [IRS]

Executive Compensation and Nonqualified Plans

Job Loss: How to Protect Your Stock Options and RSUs

"[1] Keep all documents related to equity comp and employment ... [2] Understand your post-termination rules ... [3] Understand the tax impact."  MORE >>

Selected New Discussions

Correcting Premature Rollover Into 401(k) Plan -- Individual Never Became Employee

"A sponsor and a job applicant were 99% sure the applicant would become an employee of the sponsor. While final negotiations was taking some time, the applicant rolled in money from a prior company to this sponsor's 401k plan, this sponsor signed approval of the roll-in, and the roll-in was completed, and an account holding assets was created for a non-employee roll-in to this plan. Then the negotiations fell apart without the applicant ever becoming an employee (though in this case, the applicant may still become an employee in the next 6-12 months). I've no background on this to even know where to begin asking questions, but here goes.... Is this a violation of ERISA type rules? Is it an automatic violation of plan document design? What type of penalties exist? Must the plan disgorge the assets back to 'never-employee' immediately? Does the 'never employee' now have rights as a current plan participant? Can they just treat this 'never-employee' account balance as a terminated employee? Does it have any impact on testing? Would it impact the count for plan audit status? Any thoughts on how to address this are appreciated."

BenefitsLink Message Boards

Are There Reasons Not to Merge Union and Non-Union Plans?

"An employer maintains two § 401(a)-(k) plans, one for manufacturing employees, who are union-represented, and another for office employees, none of whom is union-represented. The employer is considering merging the two plans into one. The plan for office employees uses a safe-harbor matching contribution to meet rules about coverage, nondiscrimination, and top-heavy. Even after the plans’ merger, there would be no risk, even with substantial growth in both headcounts, that the merged plan’s participant count would reach a number that calls for engaging an independent qualified public accountant. The employer is not worried about a tax-qualification defect for either plan. Are there other reasons for not merging the plans? Are there other reasons to prefer the hygiene of separate plans?"

BenefitsLink Message Boards

Press Releases

Partners Marc Schechter, Robert K. Butterfield, Corey F. Schechter and Paul D. Woodard Named on 2023 Super Lawyers List

Butterfield Schechter LLP

Voya Launches New Advisory Services Solution for Retirement Plan Participants

Voya Financial

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Rep and Warranty Insurance and Executive Compensation and Employees Benefits



Winning Employee Hearts With Your Benefits Package

April 4, 2023 PODCAST

HR Daily Advisor

Student Loan Repayment Benefits

April 19, 2023 WEBINAR


Proposed Changes to the Department of Labor’s Voluntary Fiduciary Correction Program

April 19, 2023 WEBINAR

Miller Johnson

Advisor RFPs: The Ultimate Step-by-Step Guide

April 20, 2023 WEBINAR

CAPTRUST Financial Advisors

DOL Audits: Prevent, Prepare and Protect

April 25, 2023 WEBINAR


DC Quarterly Update (Q2)

May 3, 2023 WEBINAR


IRA Beneficiary Distributions, Part 1

May 11, 2023 WEBINAR


A Look at Mortality and Its Regulations

May 17, 2023 WEBINAR

Conference of Consulting Actuaries

Last Issue's Most Popular Items

To Roth or Not to Roth


SECURE 2.0: New Rules for Correcting Overpayments Add Protection for Plan Fiduciaries

Trucker Huss

The Retirement Saving and Income Handbook (PDF)

Insured Retirement Institute [IRI]

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

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