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Retirement Plans Newsletter

February 6, 2024

3 New Job Opportunities 3 New Job Opportunities


[Official Guidance]

Text of DOL Advisory Opinion 2024-01A Clarifying That Lloyd's of London Can Continue to Sell ERISA Bonds on Basis of NAIC Registration Even If Not State-Licensed

"Based on [the information provided], it appears the NAIC IID acts on behalf of the state departments of insurance to, in effect, license Lloyd's underwriters to 'enter into bonding arrangements of the type required by the Act.' Accordingly, the [DOL] will treat the NAIC authorization as satisfying the condition ... that Lloyd's underwriters 'be licensed in a state of the United States to enter into bonding arrangements of the type required by the Act."  MORE >>

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

[Guidance Overview]

SECURE 2.0 Required Interim Amendment Deadline Changes (Again)

"When SECURE 2.0 was enacted in 2022, the deadline for qualified plans to retroactively adopt required amendments and receive anti-cutback protection was no later than the last day of the first plan year beginning on or after January 1, 2025. SECURE 2.0 also extended the remedial amendment period for the SECURE Act 1.0, CARES Act, and Relief Act required amendments to coordinate with this later deadline. The Notice now extends the deadline to December 31, 2026. The Notice specifically provides that required amendments adopted after this deadline will not receive anti-cutback relief."  MORE >>

KLB Benefits Law Group

[Guidance Overview]

Puerto Rico Department of the Treasury Announces 2024 Limits on Qualified Retirement Plans

"On January 31, 2024, the Puerto Rico Department of the Treasury issued Internal Revenue Circular Letter No. 24-01 announcing the applicable 2024 limits for Puerto Rico qualified retirement plans. Pursuant to ... the Puerto Rico Internal Revenue Code ... the Secretary of the Treasury is required to publish the applicable limits under Section 401(a) of the [U.S.] Internal Revenue Code ... which are incorporated by reference into the PR Code limits (e.g., annual compensation, annual benefit/contribution limits), once the IRS publishes its retirement plan limits under the US Code."  MORE >>


[Guidance Overview]

Form 5500 Updates: Participant Count Win and Large Plan Filer Warning

"The [Independent Qualified Public Accountant report (IQPA). ] is a constant pain point for employers -- and particularly smaller employers -- when preparing to file the 401(k) plan Form 5500. This change is a major win for a significant group of small to mid-sized employers that will no longer be subject to the IQPA requirement.... Apparently, the DOL intends to crack down on the 'file without the audit' approach unless the amended return is filed with the complete IQPA attached before the Rejection Letter is issued (for those keeping track -- that is before the 30th day after the extended filing deadline)."  MORE >>


Are Pensions Poised to Make a Comeback?

"While pensions have lost ground in recent years to 401(k) plans, experts say they may be ready for a comeback of sorts. Not only are employers thinking about adding or unfreezing pensions, they are also considering modernizing and diversifying the accounts to make them more attractive and flexible for employees."  MORE >>

Society for Human Resource Management [SHRM]; membership may be required to view article

What If We Ended 401(k) Tax Breaks to Save Social Security?

"The bulk of retirement account tax breaks benefit the affluent, Andrew Biggs and Alicia Munnell argued in a recent paper. Research shows that tax-preferred retirement accounts don't boost overall household savings, they write. Another group of researchers argues the plan would amount to double taxation and would ultimately make the Social Security program less stable."  MORE >>


Pension Risk Transfer 2.0: Dynamics of the Insurance Market

"[F]or corporate plan sponsors seeking to transfer pension liabilities [t]he rising involvement of insurance companies is leading to greater efficiencies in the marketplace, resulting in more competitive pricing and choices for companies. While this is good news for plan sponsors, they have to continue to exercise caution in carrying out their fiduciary responsibility and act in the best interest of plan participants."  MORE >>



Brief Amicus Curiae to the Fifth Circuit Challenging 'Tie-Breaker' Rule in DOL's ESG Regulation

26 pages. "DOL's tie-breaking rule violates ERISA's duty of loyalty under ERISA Section 404(a)(1)(A). ERISA's duty of loyalty requires ERISA-regulated trustees to invest plan resources for the 'exclusive purpose of. .. providing' economic benefits to plan participants and their beneficiaries, 'solely in the interest of the participants and beneficiaries.' The tie-breaking rule violates this stringent statutory duty of loyalty because it permits plan trustees investing plan resources to consider 'collateral benefits,' i.e., the welfare of third parties or social goals. But ERISA's plain text does not permit this result. The words 'solely' and 'exclusive purpose' in Section 404(a)(1)(A) do not mean 'collateral benefits.' " [Utah v. Walsh, No. 23-0016 (N.D. Tex. Sep. 21, 2023; on appeal to 5th Cir. as Utah v. Su, No. 23-11097)]  MORE >>

Prof. Edward A. Zelinsky, via SSRN


OK, Boomer: Retirement Prospects for Younger Americans Actually Look Bright

"[C]ontrary to the perception that economic conditions have left younger Americans cynical about saving and investing, young retirement savers are bullish about their retirement accounts over the long run. They also strongly support core features of the U.S. retirement system -- something that policymakers and academics should keep in mind when contemplating policy changes."  MORE >>

Investment Company Institute [ICI]

Benefits in General

[Official Guidance]

IRS Disaster Relief Announcement ME-2024-02, for Taxpayers Impacted by Severe Storms and Flooding in Maine

"[I]ndividuals and businesses in parts of Maine affected by severe storms and flooding that began on Dec. 17, 2023 ... now have until June 17, 2024, to file various federal individual and business tax returns and make tax payments.... [I]ndividuals and households that reside or have a business in Androscoggin, Franklin, Hancock, Kennebec, Oxford, Penobscot, Piscataquis, Somerset, Waldo, and Washington counties, qualify for tax relief."  MORE >>

Internal Revenue Service [IRS]

[Guidance Overview]

IRS Releases Final Guidance on Penalty Exceptions for Failure to File Correct Information Returns or Furnish Payee Statements

"The final regulations update penalty amounts relating to information returns and payee statements that are not currently accounted for in the existing regulations, establish a maximum number of returns to which the de minimis exception can apply for a calendar year, and define when and how a payee may elect not to have the statutory safe harbor rules apply."  MORE >>


Executive Compensation and Nonqualified Plans

Deferred Compensation Arrangements for Non-Profits

"While there are a number of differences between a Section 457(f) plan and a for-profit deferred compensation plan, the biggest is the timing of the taxation of the deferred compensation. A for-profit deferred compensation plan can be designed so that once the right to deferred compensation vests, it can be taxed (for income tax purposes) on the date that it is paid, which can be many years in the future. With a Section 457(f) plan, once the deferred compensation vests, it becomes immediately taxable, even if the plan provides for payment of the deferred compensation in a future year."  MORE >>

Holland & Hart LLP

Employee Benefits Jobs

View job as ESOP Administrator for Blue Ridge ESOP Associates

ESOP Administrator

Blue Ridge ESOP Associates


View job as ESOP Administrator for Blue Ridge ESOP Associates

View job as Product Support Specialist for / Wolters Kluwer

Product Support Specialist / Wolters Kluwer


View job as Product Support Specialist for / Wolters Kluwer

View job as TPA Department Manager for Keating and Associates, Inc.

TPA Department Manager

Keating and Associates, Inc.

Remote / Manhattan KS / Overland Park KS / Chicago IL

View job as TPA Department Manager for Keating and Associates, Inc.

Selected New Discussions

Deadline for Contribution to NFP 403(b) Plan

"For a calendar year NFP 403b plan, they want to make their deposit sometime in August (for Reasons). But they intend on filing their 990 at the regular deadline (5/15/24, 4.5 months after the end of the year). I know that in the for-profit world, this means that they can't take the deduction for it in the prior year, so they might run into a 404 issue in 2024. Does that apply to a NFP?"

BenefitsLink Message Boards

Calculating Make-Up Contributions Following Military Leave

"Have an employee who just returned from military service and am trying to make sure she receives all of her make up elective deferrals correctly. [1] If the plan only allows contributions up to 60% of salary per pay period, can the employee exceed this with the make up contributions? [2] What if our match changed from during their leave? Do we use the old match or the new match? or prorate it? [3] Is there an easy way to calculate total amount they are eligible to catch up?"

BenefitsLink Message Boards

Plan Termination, and Summary of Material Modifications

"Suppose a calendar year plan is terminating in March. The plan must, of course, amend for SECURE and SECURE 2.0 -- (CARES amendment was done way back). I believe that technically, since the amendment is ADOPTED in 2024, and there is a 210 day period following the end of the PLAN YEAR IN WHICH THE AMENDMENT IS ADOPTED (hence 210 days into 2025) that no SMM is required. Now, employees were previously notified if certain provisions applied -- QBAD's, for instance, albeit not in a formal SMM. If I'm correct, this makes the plan termination process easier, because the SMM's can be wildly variable with the voluminous possible changes ... Thoughts?"

BenefitsLink Message Boards

Press Releases

Ascensus Announces New Retirement Business Structure and Leadership


Webcasts and Conferences
(Retirement Plans / Executive Compensation)

New IRS Guidance for Implementing SECURE 2.0 Provisions: Key Provisions and Compliance Challenges for Plan Sponsors

March 5, 2024 WEBINAR


Getting It Right: Know Your Fiduciary Responsibilities, Part 1

March 5, 2024 WEBINAR

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

Getting It Right: Know Your Fiduciary Responsibilities, Part 2

March 13, 2024 WEBINAR

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

Last Issue's Most Popular Items

Text of IRS Request for Comments on Rev. Proc. 2024-4: Procedure for IRS Employee Plans Determination Letters, Rulings and Agreements

Internal Revenue Service [IRS]

You Don’t Have To Go Home, But You Can’t Stay Here: Cashout Limit Increases to $7000

Jackson Lewis P.C.

IRS Guidance Illuminates SECURE 2.0's Roth Employer Contributions


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

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