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Retirement Plans Newsletter

January 17, 2024

6 New Job Opportunities 6 New Job Opportunities

 

[Official Guidance]

Text of DOL FAQs: Pension-Linked Emergency Savings Accounts (PLESAs)

20 Q&As address: [1] Eligibility and participation; [2] Contributions; [3] Distributions and withdrawals; and [4] Administration and investment.  MORE >>

Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

[Official Guidance]

Defined Contribution Pre-Approved Plans Listing of Required Modifications and Information Package (LRM) (PDF)

150 pages; January 2024. "This Information Package contains samples of plan provisions that have been found to satisfy certain specific requirements of the Internal Revenue Code, taking into account changes in the plan qualification requirements, regulations, revenue rulings, and other guidance ... including changes enacted by the [CARES Act] ... the [SECURE] Act of 2019 ... and ... the SECURE 2.0 Act of 2022 ... Such language may or may not be acceptable in different plans depending on the context in which used." [Also available: Redlined version]  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Cash or Deferred Arrangement (CODA) Listing of Required Modifications and Information Package (LRM) (PDF)

60 pages; January 2024. "This Information Package contains samples of plan provisions that have been found to satisfy certain specific requirements of the Internal Revenue Code, as amended through the SECURE 2.0 Act of 2022 ... These CODA LRMs are not revised to reflect certain changes to catch-up contribution limits and requirements enacted by SECURE 2.0, to the extent these changes are not included on the Cumulative List. This CODA LRM also does not include plan language for implementing pension-linked emergency savings accounts (PLESAs) ... added by Section 127 of SECURE 2.0." [Also available: Redlined version]  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Employee Stock Ownership Plan Pre-Approved Plans Listing of Required Modifications and Information Package (LRM) (PDF)

45 pages; January 2024. "[Rev. Proc. 2015-36] expanded the pre-approved program to cover employee stock ownership plans (ESOPs) and set forth certain requirements to be a pre-approved ESOP.... This information package contains samples of plan provisions that satisfy certain requirements of the Code applicable to ESOPs. Such language may or may not be acceptable in specific plans depending on the context in which used. To expedite the review process, plan sponsors are encouraged to use the language in this package."  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Draft of 2023 Instructions for IRS Form 8955-SSA: Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits (PDF)

8 pages; Jan. 12, 2024. "Form 8955-SSA ... is used to satisfy the reporting requirements of section 6057(a). Form 8955-SSA is a stand-alone reporting form filed with the IRS.... DO NOT file Form 8955-SSA with Form 5500 ... or Form 5500-SF ... Use Form 8955-SSA to report information relating to each participant who separated from service covered by the plan and is entitled to a deferred vested benefit under the plan but is not paid this retirement benefit."  MORE >>

Internal Revenue Service [IRS]

[Official Guidance]

Text of 2023 Instructions for IRS Form CT-1, Employer's Annual Railroad Retirement Tax Return (PDF)

20 pages. "What's New: [1] Changes to tax rates and compensation bases.... [2] The COBRA premium assistance credit lines have been 'Reserved for future use' on Form CT-1 because the first quarter of 2022 was the last quarter in which most employers may have been eligible to claim the COBRA premium assistance credit." [Also available: 2023 IRS Form CT-1]  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

SECURE 2.0's Small Change to Cash-Outs Could Have Significant Financial Effect for Plan Sponsors

"Beginning this year, plan sponsors may increase their qualified plan's mandatory cash-out limit from $5,000 to $7,000.... Plan sponsors that are near or approaching the audit participant threshold will want to seriously consider implementing the increased mandatory cash-out threshold.... Mandatory cash-out distributions are ... triggered while participant contact information is current.... Although plans can begin using this feature today, not all recordkeepers have updated their systems to administer the new cash-out value."  MORE >>

Bricker Graydon

[Guidance Overview]

The New Fiduciary Rule, Part 15: Reasonable Costs and Reasonable Compensation

"A practical definition is that reasonableness is what an informed investor, operating in a competitive marketplace and with knowledge of the material facts, would agree to. Importantly, reasonableness is not a percent or an amount. Instead, it is a range."  MORE >>

FredReish.com

A Recordkeeper Perspective on Retirement Legislation and Delays (PDF)

"This article highlights the importance of collaboration among all parties when dealing with legislative changes and ensuring that those changes are met."  MORE >>

John Hancock, via Journal of Pension Benefits

Plan Sponsor Concerns About 401(k)-to-IRA Direct Transfers

"Between SECURE 2.0 auto-portability requirements and the impact of the DOL's new Fiduciary Rule on IRA Rollovers, we may be entering a new world when it comes to money moving into IRAs from 401k plans.... The first thing to recognize is, while often referred to as 'IRA Rollovers,' technically, these money movements are not rollovers."  MORE >>

Fiduciary News; free registration required

The Best Flexible Strategies for Retirement Income

"Strategies that involve changing withdrawal amounts from year to year -- taking lower withdrawals in weak market environments and perhaps higher paydays in very strong ones -- typically allow for higher withdrawal rates. Flexible strategies are effective because they help to prevent retirees from overspending in periods of market weakness, while giving them a raise in stronger market environments."  MORE >>

Morningstar

An Actuarial Perspective on the 2023 Social Security Trustees Report (PDF)

"The actuarial deficit increased from 3.42% of taxable payroll to 3.61% of taxable payroll. In addition to the economic results, the system's financial status was affected by changes in demographic assumptions and methodology, and by the shift in the valuation period (which adds a year of less favorable finances at the end of the 75-year projection period)."  MORE >>

American Academy of Actuaries

[Opinion]

House Committee Letter to PBGC Questioning Refusal to Recover $127 Million in Taxpayer Money Sent to Ghost Pensions (PDF)

"The Committee on Education and the Workforce (Committee) is investigating reckless mismanagement at the [PBGC] that led to sending a $127 million overpayment to one multiemployer plan. This overpayment raises the concern that more overpayments exist.... By all appearances, PBGC intended to shift taxpayer dollars to the Central States Pension Fund in an unauthorized windfall and refuses to get this money back"  MORE >>

Committee on Education and the Workforce, U.S. House of Representatives

[Opinion]

A System to Protect Workers' Retirement Assets Already Exists

"Improving the odds for American workers achieving their retirement income goals will require a combination of better education and alternatives to the predatory business models that currently dominate the retirement plan investment adviser industry."  MORE >>

planadviser

Benefits in General

New Year, New Coverage: Help Your Employees Avoid Mistakes

"Look out for these common stumbling blocks that can trip up any employee.... [1] Skipping dependent coverage ... [2] Misunderstanding dependent care flexible spending accounts ... [3] Frustrations with prior authorizations ... [4] Overlooking health savings account eligibility ... [5] Provider network changes ... [6] Missing or outdated beneficiary information."  MORE >>

Corporate Synergies

Executive Compensation and Nonqualified Plans

RIP Compensation Committees

"[B]oards are electing to alter their committee structures to keep pace with their increasing oversight demands.... While such changes may at first seem arbitrary, insignificant, or aesthetic, they are indicative of an important development in the realm of corporate governance -- specifically, that many companies have formally delegated additional responsibilities to their compensation committees."  MORE >>

Farient Advisors

Employee Benefits Jobs

View job as Defined Benefit Software Support Specialist / Senior Actuarial Analyst for ASC - Actuarial Systems Corporation

Defined Benefit Software Support Specialist / Senior Actuarial Analyst

ASC - Actuarial Systems Corporation

Remote / Sylmar CA

View job as Defined Benefit Software Support Specialist / Senior Actuarial Analyst for ASC - Actuarial Systems Corporation

View job as Lead Plan Admin Analyst for Ameritas

Lead Plan Admin Analyst

Ameritas

Remote

View job as Lead Plan Admin Analyst for Ameritas

View job as Implementations and Documents Specialist for Stones River Consulting

Implementations and Documents Specialist

Stones River Consulting

Remote

View job as Implementations and Documents Specialist for Stones River Consulting

View job as Operations Manager - Distributions and Loans  for My Benefits, LLC

Operations Manager - Distributions and Loans

My Benefits, LLC

Daphne AL / FL / GA / SC

View job as Operations Manager - Distributions and Loans  for My Benefits, LLC

View job as Relationship Manager for My Benefits, LLC

Relationship Manager

My Benefits, LLC

Daphne AL / FL / GA / SC

View job as Relationship Manager for My Benefits, LLC

View job as Pension Analyst II for My Benefits, LLC

Pension Analyst II

My Benefits, LLC

Daphne AL / FL / GA / SC

View job as Pension Analyst II for My Benefits, LLC

Selected New Discussions

403(b) Plan Termination

"We are working on a 403(b) plan termination with TIAA CREF. Although TIAA CREF has certified that the plan is terminated, we have plan summaries with assets after the termination date, which, according to TIAA CREF, is attributable to individual contracts. These plan summaries still have the plan sponsor's name on the reports. At what point can we say that we have sufficient documentation to say that the plan is terminated and all plan assets have been distributed?"

BenefitsLink Message Boards

Special Tax Notice

"Does anyone have a generic special tax notice that they have been using that doesn't reference any recordkeeper names? Something special designed for TPA's for example? ... The IRS one has two separate notices, one for Roth and one for Pre-tax and that's, well, not workable."

BenefitsLink Message Boards

DB Plan: Ceasing Benefit Accruals After Lump Sum?

"Can a DB plan be amended to permit in-service lump sum distributions and also cease future accruals for any person who elects to take a lump sum?"

BenefitsLink Message Boards

Self-Certification of Hardship Distributions

"I know Secure 2.0 had initially said that Hardship Distribution could be self-certified. Was that pushed back, though? I just want to make sure, as we had a client that had adopted that strategy, but I think we may need to backtrack. I just want to be sure."

BenefitsLink Message Boards

Press Releases

Theresa Taylor re-Elected CalPERS Board President, David Miller Elected Vice President

CalPERS [California Public Employees' Retirement System]

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

2024 Excess Fee and Imprudent Investment Litigation

January 30, 2024 WEBINAR

Euclid Fiduciary

The DOL Fiduciary Rule Proposal

January 31, 2024 WEBINAR

CEFLI [Compliance & Ethics Forum for Life Insurers]

Death Benefit RMDs

February 20, 2024 WEBINAR

ASPPA [American Society of Pension Professionals & Actuaries]

Employee Benefits in Mergers and Acquisitions National Institute 2024

May 14, 2024 WEBINAR

American Bar Association Joint Committee on Employee Benefits [JCEB]

Last Issue's Most Popular Items

IRS Issues Guidance on Miscellaneous SECURE 2.0 Provisions

Bolton

The Excellent Fiduciary: Traits of Effective Committee Members (PDF)

Roland Criss, via Journal of Compensation and Benefits

IRS Offers Guidance on Emergency Savings Accounts

Accounting Today; subscription may be required

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

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