"Recognizing [that] market conditions [in late 2022 and early 2023] may produce unusually low funding results in the actuarial valuations, [in Technical Update 23-1] PBGC is providing a waiver if certain conditions are satisfied ... The general changes in the Final Regulations are ... [1] No lump sums once PBGC is trustee.... [2] Increased limit for small lump sum distributions.... [3] Clarification to QPSA payments.... [4] Lump sums required for estates.... [5] Withdrawal of mandatory employee contributions.... [6] Payment corrections.... [7] Method for valuation of assets."  MORE >>

"DOL's reinterpretation of the five-part test in the PTE is currently being litigated. And DOL has put on its agenda yet another re-write of its fiduciary advice regulation ... which itself will likely be litigated. One way or another, in this ongoing litigation, the courts will be asked to decide whether the application of advice fiduciary status to call center operators ... is authorized by ERISA. And included in that litigation will be arguments about when advice fiduciary status can be defeated by an assertion that the call center operator was a mere sales pitch and not investment advice." [Reetz v. Aon Hewitt Investment Consulting Inc., No. 21-2267 (4th Cir., July 17, 2023)]  MORE >>

"The Ninth Circuit found that the district court should not have granted summary judgment in AT&T's favor because there were triable issues of fact as to whether the arrangements with and compensation to Fidelity were 'reasonable,' and therefore exempt from ERISA's prohibited transaction provisions pursuant to ERISA Section 408(b)(2).... [T]he Ninth Circuit read the prohibited transaction rules and regulations more literally -- finding that AT&T had engaged in a prohibited transaction by simply amending the contract with Fidelity to incorporate the services of Brokeragelink and Financial Engines." [Bugielski v. AT&T Servs., Inc., No. 21-56196 (9th Cir. Aug. 4, 2023)]  MORE >>

"The Ninth Circuit reasoned that the amended contract was a prohibited transaction under ERISA Section 406(a)(1)(C) because the recordkeeper was a 'party in interest' and the expansion of that party's role with, and compensation received from, the plan involved 'furnishing of goods, services, or facilities between the plan and a party in interest.' And the Ninth Circuit concluded that it could not enforce the 'reasonable compensation' exemption at this point in the case, because the fiduciaries failed to take into account revenue that the recordkeeper had received from third parties." [Bugielski v. AT&T Servs., Inc., No. 21-56196 (9th Cir. Aug. 4, 2023)]   MORE >>

11 pages. " The focal point of [a] growing number of ... lawsuits is the compensation that employers arrange for payment to the vendors of services to the ERISA plans the employers sponsor. A crisis among retirement plan sponsoring enterprises is unfolding. The challenge facing their leaders is to ensure that operations managers are equipped with the training, guidelines, controls, and tools that elevate fiduciary risk management to its proper priority. Underestimating the economic and reputational risks related to deficiencies in the prudent management of ERISA plans threatens an entire enterprise."  MORE >>

"The Plan Regulatory Notice generally will provide that a response must be received within a specified number of days from the date listed at the top of such notice. As a reminder, the ultimate responsibility for plan compliance, including responsibility for responding to Plan Regulatory Notices, falls on the plan sponsor even if a third-party service provider handles most of the day-to-day administration of the plan."  MORE >>

"As the 2024 presidential campaign ramps up, candidates are facing pressure to pledge not to touch Social Security. While this pledge is framed as 'protecting benefits,' it is -- in reality -- an implicit endorsement of a 23 percent across-the-board benefit cut in 2033, when the Social Security retirement fund becomes insolvent. In that year, annual benefits would be cut by $17,400 for a typical newly retired dual-income couple."  MORE >>

"To determine whether your company's corporate income tax extension will automatically extend the Form 5500 deadline, you must determine the regular and extended due dates for its federal tax return. Income tax return filing deadlines, and the available extension periods, differ based on the entity's corporate form and tax year.... Plans that timely file Form 5558 have a clear Form 5500 filing deadline, which may be preferable to navigating these complex timing rules."  MORE >>