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Retirement Plans Newsletter

May 3, 2023

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[Guidance Overview]

Long Term Part-Time Employee Eligibility: Are You Ready? (PDF)

"[U]nder the new rule, the absolute earliest that an LTPTE could accrue three consecutive 12 month eligibility periods with at least 500 hours of service would be December 31, 2023 which would then trigger an initial participation date of no earlier than January 1, 2024.... [It] is critical for plan sponsors to begin collecting and analyzing the relevant payroll and employment data from 2021 and 2022 now in order to be prepared for this significant change to the eligibility rules in 2024."  MORE >>

Legacy Retirement Solutions

District Court Dismisses 401(k) Class Action Alleging Breach of ERISA Fiduciary Duties

"A recent federal court decision ... shows that fiduciaries of ERISA retirement plans may be able to attack and defeat complaints alleging breaches of ERISA fiduciary duties at the pleading stage if the right arguments are made and if certain fact patterns are present." [Jones v. Dish Network Corp., No. 22-0167 (D. Colo. Mar. 27, 2023)]  MORE >>


Alert (High Risk Issue) icon What to Watch Out for with Roth 401(k) Conversions

"Roth contributions or conversions are taxable in the year contributed or converted.... Each Roth conversion has a separate five-year tracking period to be a qualified distribution, so this may prove a challenge when record-keeping the amounts.... After-tax contributions to a qualified plan like a 401(k) are subject to the ACP nondiscrimination test (even in a safe harbor plan)."  MORE >>

American Retirement Association [ARA]

Why Clean Data Is Crucial for Successful PRT Transactions

"Reliable and accurate participant data that will not need to be scrutinized later gives the insurer the confidence to provide a reliable price upfront. It also ensures that the participant is receiving communication, better understands the upcoming changes, and will receive future communications from the insurance company."  MORE >>

PBI Research Services

Building a Retirement Plan for Today and Tomorrow

"[Participants] want greater customization; and they are worried about making their retirement savings last.... [P]articipants and plan fiduciaries are solving for the greater customization demand through advisor managed account (AMA) services.... SECURE 2.0 Act provides additional tools to reach out to recent college graduates to help with their student loan repayments or your employees who have never built up a short-term emergency fund."  MORE >>

Qualified Plan Advisors [QPA]


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Survey Identifies Leading Disruptors of the Retirement Industry

"An aging workforce, Generation Z, the growing demand for personalized investment advice, and financial wellness were four areas cited as some of the top disruptors of the retirement industry in a recent survey. Each area is viewed as a priority in the next 5-7 years to help address the widening retirement gap that is approaching $4 trillion in the U.S."  MORE >>

401(k) Participant Incentives: Retirement Savings vs. Tax Savings

"While the tax savings acts as the hook, it's clear the goal is amassing enough assets to fund a comfortable lifestyle once employees hang up their cleats. More than a hook, however, tax savings introduces the opportunity to create opportunistic financial approaches."  MORE >>

Fiduciary News; free registration required

Why Do Late Boomers Have So Little Wealth and How Will Early Gen Xers Fare? (PDF)

36 pages. "Due to changes in the retirement landscape in recent decades, Late Boomers (who are now nearing retirement) would be expected to have less wealth from traditional pensions, Social Security, and housing, but higher 401(k)/IRA assets compared to Mid Boomers at the same age. Strikingly, though, Late Boomers have seen a drop in their 401(k)/IRA assets. The questions are why is their 401(k)/IRA wealth lower and what do the patterns mean for younger cohorts."  MORE >>

Center for Retirement Research at Boston College

PBGC Approves $95 Million in SFA for Building Material Drivers Local 436 Plan

"[The Plan], based in Cleveland, Ohio, covers 1,461 participants in the transportation industry.... The plan was projected to run out of money in 2026."  MORE >>

Pension Benefit Guaranty Corporation [PBGC]

PBGC Approves $214.6 Million in SFA for United Furniture Workers Fund A

"[The Plan], based in Nashville, Tennessee, covers 8,434 participants in the manufacturing industry. On September 1, 2017, the [Plan] implemented a benefit suspension under [MPRA] and was partitioned into two plans.... PBGC's approval of the SFA application rescinds the partition and enables the plan to restore all benefits suspended under the terms of MPRA and to make payments to retirees to cover prior benefit suspensions."  MORE >>

Pension Benefit Guaranty Corporation [PBGC]

Benefits in General

[Guidance Overview]

Reform of Family Attribution Rules Under SECURE 2.0

"[R]evised family attribution rules under [SECURE 2.0], effective for plan years after December 31, 2023, will permit businesses owned separately by spouses to provide benefits to their respective employees without necessarily having to count the employees of the other spouse.... [F]amily-owned entities ... should understand how the Act may alter the employee populations counted for qualified retirement plans and also for identifying Applicable Large Employer status under the health insurance mandate of the [ACA]."  MORE >>

KLB Benefits Law Group

Executive Compensation and Nonqualified Plans

[Guidance Overview]

SEC Indicates Early August 2023 May Be Deadline for Adoption of Dodd-Frank-Compliant Clawback Policies

"The SEC indicated ... that it expects to take longer than the initial 45 days contemplated by the proposed NYSE/Nasdaq clawback listing standards and expects to instead take up to the full 90 days (or longer) to approve the standards. The outside date of this 90-day review period (barring another SEC extension) will be June 11, and the SEC has stated that it will decide on the current proposals by that date (absent further extension)."  MORE >>

Morgan Lewis

Employee Benefits Jobs

View job as Defined Contribution Consultant
            for AimPoint Pension Group

Defined Contribution Consultant

AimPoint Pension Group


View job as Defined Contribution Consultant for AimPoint Pension Group

Selected New Discussions

Plan Requires RMDs by January 1 Not April?

"I have a plan where the required distribution language reads 'by January 1st of the calendar year following the calendar year in which he/she attains the age of [70-1/2]'. I suppose this qualifies as meeting the RMD requirements, but it struck me as odd and wanted to ask around and see if I was missing something. Can a plan sponsor select a slightly earlier date for the RMDs and not run afoul of the rules? (They must have gotten a determination letter at some point, so it passed muster in this form.) It's an ESOP if it matters. (And I'm putting aside the SECURE 2.0 Act's updates to the ages for now.)"

BenefitsLink Message Boards

SECURE 2.0 Roth Catch-Up for HPEs: Payroll or TPA Monitoring Function?

"My thoughts are that the primary responsibility for determining an HPE and remitting Roth Catch-Up for Highly Paid Employees is mostly a payroll function. The TPA/Recordkeeper may be able to add processes and tools and communications to facilitate the proper administration, but ultimately the payroll companies will have to enhance their systems to accommodate this SECURE 2.0 provision. I am curious to know where the 401k community lands on this process?"

BenefitsLink Message Boards

Uncashed Checks for Small Distributions

"This NOT a plan termination. Participants terminate employment, get their 402(f) notice, and notification that if they don't respond within 30 days, they will receive a lump sum cash payment. (This would be for accounts less than $1,000.) Some of these accounts could be Roth. Some amount of time passes. Let's say at least until the following calendar year. I'm not at all sure proper steps have been taken (internet search, etc., etc. as outlined in DOL FAB 2014-01) to determine if these people qualify as 'missing participants.' 'Missing participants' where the amount is less than $1,000 have a specific procedure in the plan language -- basically, roll to an IRA or treat as a forfeiture. So, these are 'unresponsive' participants -- they just have never cashed the the checks. Now the Plan Administrator decides to have these amounts rolled to an IRA. My question is twofold -- first, is this allowable? Second, if so, or at least defensible, how to report? The distribution has already been reported, and if taxable, has been taxed. Interested in what people perceive as a 'best solution' where it appears that no solution is perfect."

BenefitsLink Message Boards

Press Releases

RFP for Consulting Services to the California Retirement Savings Board


Transamerica Names Oriana Freidenberg to Lead Customer Experience and Marketing for Life Insurance and Annuities


Health-E Commerce Offers Tips for Using Tax-Free Healthcare Funds to Protect Mental Wellbeing

Health E-Commerce

Strongpoint Partners Announces Partnership with Retirement Planners and Administrators

Strongpoint Partners

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

Retirement and Retention Strategies for Closely Held Private Companies


Executive Benefit Solutions

Advisor Fund Comparison Tools


Corporate Insight

Employee Benefits: Current and Future Trends

June 7, 2023 WEBINAR

Conference of Consulting Actuaries

Last Issue's Most Popular Items

SECURE 2.0: So, About That Employer Roth Contribution

Ferenczy Benefits Law Center

Important Alert for 401(k) and 403(b) Plans That Do Not Allow Participants to Make Roth Contributions

Frost Brown Todd LLC

Text of IRS Draft Instructions for Form 5307: Application for Determination for Adopters of Modified Nonstandardized Pre-Approved Plans (PDF)

Internal Revenue Service [IRS]

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

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