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Retirement Plans Newsletter

October 19, 2023


[Official Guidance]

Text of IRS Final Regs: Mortality Tables for Determining Present Value under Defined Benefit Pension Plans

32 pages. "This document sets forth final regulations prescribing mortality tables to be used for most defined benefit pension plans.... The tables are used (together with other actuarial assumptions) to calculate the present value of a stream of expected future benefit payments for purposes of determining the minimum funding requirements for the plan. These mortality tables are also relevant for determining the minimum required amount of a lump-sum distribution from such a plan."  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Text of IRS Proposed Regs: Plan-Specific Substitute Mortality Tables for Determining Present Value

11 pages. "This document sets forth proposed regulations that would update the requirements that a plan sponsor of a single-employer defined benefit plan must meet to obtain IRS approval to use mortality tables specific to the plan in calculating present value for minimum funding purposes (as a substitute for the generally applicable mortality tables)"  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Text of IRS Notice 2023-72: Weighted Average Interest Rates, Yield Curves, and Segment Rates for October 2023 (PDF)

"This notice provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates ... and the 24-month average segment rates ... [as well as] the interest rate on 30-year Treasury securities ... as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate[.]"  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

IRS Updates Regulations for Use and Timing of Forfeitures (PDF)

"[Defined contribution plan] sponsors should review their plan document terms and forfeiture procedures with their recordkeeper to ensure they are consistent with the proposed regulations. [Plan sponsors should] make sure that the use of the available forfeitures is set forth in the plan document, and that the forfeitures are allocated or used for expenses or contributions within the 12-month period following the end of the plan year. This will require some tracking of forfeitures to ensure they are allocated or used timely. "  MORE >>

Groom Law Group, via Journal of Pension Benefits

Updated Projections of 2024 Retirement Plan Limits

"The 2024 limits will reflect increases in the Consumer Price Index for All Urban Consumers (CPI-U) from the third quarter of 2022 to the third quarter of 2023. Only the catch-up contribution limit, which has a relatively large rounding value, is expected to stay the same next year. This updated article reflects the final CPI-U values for August and September."  MORE >>


Missed the Safe Harbor Deadline? You've Still Got Options!

"Option 1: Potentially (likely) fail the Average Deferral Percentage (ADP) test ... Option 2: Use prior year testing (deemed 3% NHCE deferral rate that first year) ... Option 3: Start the plan for your employees, just don't use it yourself until next year ... Option 4: Start the plan, but expect your only benefit to be from the company."  MORE >>

Benefit Resources Inc.

Understanding the Retirement Savings Gap

"New research indicates that public employees with access to defined benefit pensions fare better than their private sector counterparts. [A recent] report reveals that pension income is distributed relatively equitably among recipients, regardless of race. Furthermore, public pension income is distributed more equally across gender lines than other retirement offerings. Simply put, pensions play a pivotal role in reducing retiree poverty across race, sex, and educational divides."  MORE >>

National Public Pension Coalition [NPPC]

Annuity Purchase Update, October 2023

"An all-time peak was reached this year for average annuity purchase interest rates, with the average rate of 5.29% for a 7-year duration and 5.22% for a 15-year duration.... Average Annuity Purchase interest rates skyrocketed over 35 basis points in just one month. Advantageous market conditions are driving plan sponsors to act quickly to achieve their de-risking goals before year-end."  MORE >>

October Three Consulting

GAO Reviews 403(b) Plan Oversight, Urges DOL to Enhance Outreach

"A recent [GAO report] examining federal agency oversight of Internal Revenue Code Section 403(b) plans recommends that the [DOL] provide more targeted educational materials for sponsors and participants.... Building on another report from last year that surveyed 403(b) investment options and fees, the report also examines recent state developments aimed at improving 403(b) plan administration and assembles stakeholder feedback on ways to enhance participant outcomes."  MORE >>


Benefits in General

[Official Guidance]

Text of IRS Disaster Relief Announcement SC-2023-02, for Taxpayers Affected by Hurricane Idalia Anywhere in South Carolina

"Taxpayers affected by Hurricane Idalia that began Aug. 29. 2023 anywhere in South Carolina now have until Feb. 15, 2024, to file various individual and business tax returns and make tax payments ... [I]ndividuals and households affected by Idalia that reside or have a business in all 46 counties in South Carolina qualify for tax relief."  MORE >>

Internal Revenue Service [IRS]

Selected New Discussions

Another LTPT Question

"[A recent] article said (paraphrasing), that in general the IRS has said that all years of service must be taken into account when determining vesting for an LTPT. Wasn't it SECURE 2.0 or some other more recent guidance that allowed 401(k) plans to not count years prior to January 1, 2021 for vesting?"

BenefitsLink Message Boards

Press Releases

Cohen & Buckmann Achieves Multiple Rankings For Work in Executive Compensation, ERISA and Employment

Cohen & Buckmann P.C.

Groom Achieves Recognition in All Fall 2023 Top Workplaces Culture Excellence Categories

Groom Law Group

IRI Elects New Board Chair, Vice Chair

Insured Retirement Institute [IRI]

Vitality Offers New Mental Health Resources for Parents and Caregivers Through Partnership with RethinkCare


BlackRock Transforms Access to Retirement Solutions for Millions of Americans


Lincoln Financial Group Introduces Comprehensive Health Savings Solutions for Plan Sponsors

Lincoln Financial Group

Last Issue's Most Popular Items

SECURE 2.0 Provides Simplified Disclosure Rules for DC Plans

Watkins Ross

Treatment of Forfeitures in DC Plans: Regulation and Litigation

October Three Consulting

PBGC Announces 2024 Maximum Guarantee Limits

Pension Benefit Guaranty Corporation [PBGC]

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

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