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Retirement Plans Newsletter

July 19, 2024

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[Official Guidance]

DOL Launches Online Filing System for Termination Administrators to Submit Information on Abandoned Employee Benefits Plans

"Since 2006, the program has enabled benefit distributions to be made to participants and beneficiaries of individual account retirement plans, such as 401(k) plans, that have been abandoned by their sponsoring companies. It allows qualified termination administrators to wind up a plan’s affairs and provides them with streamlined procedures for distributing benefits. The new system offers these administrators an online option for submitting required information to the department in addition to existing email and paper-based methods."  MORE >>

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

[Guidance Overview]

Form 5330 E-Filing Requirement Headache Relieved for 2024‎

"[On] July 12, 2024, the IRS [announced] that the IRS would permit paper filing of the Form 5330 for tax years 2023 and 2024.... [T]he IRS noted that it has only one authorized AEP for filing Forms 5330 at this time. To get the relief from the electronic filing requirement, the IRS noted that employers must document the lack of AEPs as the reason for filing the Form 5330 on paper rather than electronically."  MORE >>

Locke Lord LLP

[Guidance Overview]

Changes to SIMPLE Plans Under SECURE 2.0: Not That Simple

"[S]ection 408(p)(11), allowing the mid-year change from a SIMPLE plan to a safe harbor 401(k) plan, is an exception to the general rule ... that says an employer is prohibited from maintaining both a SIMPLE IRA and another plan, contract, pension or trust ... It is the only exception. This means that you cannot also add in a Cash Balance or Defined Benefit plan in the year of the termination of the SIMPLE."  MORE >>

Ferenczy Benefits Law Center

[Guidance Overview]

PBGC Updates Instructions for 4010, Missing Participants Program Filing

"The PBGC updated these filing instructions because of assumption changes made by the 4044 final rule issued in June. Those assumptions are used to calculate certain amounts reported in 4010 and Missing Participants Program filings."  MORE >>

American Retirement Association [ARA]

[Guidance Overview]

Quick Update on Final RMD Regs

"Despite suggestions to the contrary, beneficiaries of individuals who have begun required annual distributions must continue these distributions. Except for spousal distributions, the account balance must still be fully distributed within 10 years of the individual's death."  MORE >>

TRI-AD

[Guidance Overview]

DOL Dusts Off Abandoned Plan Rule for Bankruptcy Trustees

"DOL believes that the program’s streamlined procedures will reduce administrative burdens and costs for bankruptcy trustees charged with terminating DC plans. The [interim final rule] took effect July 16. This article focuses on aspects of the IFR relevant to plan sponsors."  MORE >>

Mercer

Fifth Circuit Opinion Vacating and Remanding District Court Dismissal of Challenge to DOL's ESG Regs (PDF)

"Does ERISA allow retirement plan managers to consider factors that are not material to financial performance when making investment decisions affecting workers' retirement savings? We do not venture an answer -- at least not yet. This case, while featuring two administrations' ping-ponging directives, turns fundamentally on the words that Congress chose: What investment duties does ERISA prescribe and proscribe for plan fiduciaries? In upholding the [DOL's] reading, the district court relied upon the decades-old Chevron deference doctrine. But eleven days before we heard oral argument in this appeal, the Supreme Court decided two landmark cases ... that discarded Chevron and pared back agencies' leeway to interpret their own statutory authority. Given the upended legal landscape, and our status as a court of review, not first view, we vacate and remand so that the district court can reassess the merits." [Utah v. Su, No. 23-11097 (5th Cir. Jul. 18, 2024)]  MORE >>

U.S. Court of Appeals for the Fifth Circuit

First Reasoned ERISA Forfeitures Decision Dismisses Complaint

"Ten lawsuits have been filed since September 2023 alleging a novel theory of liability against ERISA plan sponsors for their use of forfeited employer matching retirement-plan contributions. Two motions to dismiss have been decided. One decision is useful ... [T]he court carefully considered and addressed the arguments advanced by Hutchins and HP. It concluded that the complaint over-reached and therefore should be dismissed[.]" [Hutchins v. HP Inc., No. 23-5875 (N.D. Calif. Jun. 17, 2024)]  MORE >>

Nixon Peabody LLP

Takeaways from Dismissal of Anti-ESG Lawsuit Against New York City Pension Funds

"[T]he N.Y. court decided dismissal is appropriate because the plaintiffs participate in defined benefit plans that entitle them to fixed benefits each month and therefore face no injury and lack standing to challenge investment decisions that have no impact on the guaranteed retirement benefits they will receive." [Wong v. NYCERS, TRS and BERS, No. 652297/2023 (NY Cty. Sup. Ct. Jul. 3, 2024)]  MORE >>

Cohen & Buckmann, P.C.

PBGC Projections Report: FY 2023 (PDF)

69 pages. "PBGC's Multiemployer Program is likely to remain solvent for more than 40 years, similar to the projection in last year's Projections Report.... The projected FY 2033 net financial position of the Multiemployer Program is positive in 69 percent of model scenarios, with a median value of positive $4.4 billion, but the mean net position is negative $4.7 billion. PBGC's Single-Employer Program is projected to remain in a positive net financial position over the next decade in all the modeled scenarios. The projected outcomes are improved from last year's report,"  MORE >>

Pension Benefit Guaranty Corporation [PBGC]

[Opinion]

Chevron Aftermath: More Retirement Plan Lawsuits, Fewer Formal Regs

"The Chevron deference decision also will cause 'a big impact internally' among regulatory agencies. To reduce the risk of successful court challenges, regulators will need to explain more about the authority they have based on laws ... That means proposed rules may be more conservative in their scope and terms[.]"  MORE >>

Pensions & Investments

[Opinion]

Just Say No to Automatic E-Delivery of Your Retirement Plan Records

"Avoiding more paper clutter and saving trees are good things to do, but not at the expense of missing important disclosures, or having your plan records go missing at the very time you need them. To better ensure your financial future, it's generally wise to keep getting paper copies of important plan documents."  MORE >>

Pension Rights Center [PRC]

Benefits in General

Court Denies Motion to Expand Preliminary Injunction on FTC Non-Compete Rule

"The Plaintiffs reasoned that by limiting the preliminary injunction, all affected businesses must bear the expenses of preparing to comply with the FTC ban when it becomes effective on September 4, 2024 ... Further, they noted, the court already ruled that the Plaintiffs have a likelihood of prevailing on their position that the FTC exceeded its authority in adopting the ban. On July 11, 2024, the court denied the motion to reconsider[.]" [Ryan LLC v. Federal Trade Commission, No. 24-0986 (N.D. Tex. Jul. 3, 2024; motion for reconsideration denied Jul. 11, 2024)]  MORE >>

Trucker Huss

Employee Benefits Jobs

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Alerus

Grand Forks ND

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Selected New Discussions

Mandarin and Cantonese Call Center?

"Does anyone know of a recordkeeper provider who can provide call center assistance in Mandarin and Cantonese?"

BenefitsLink Message Boards

Press Releases

PensionBee Announces U.S. Launch

PensionBee

IRI Seeks to Establish an Infrastructure for Annuity Data Standards

Insured Retirement Institute [IRI]

Old Slip Capital Announces New Miami Office, Issues Advisory for ERISA by James Lukezic, Managing Director

Old Slip Capital

Webcasts and Conferences
(Retirement Plans / Executive Compensation)

ERISA Service Provider Agreements: Negotiating, Drafting, and Monitoring Contracts for Benefit Plans

August 29, 2024 WEBINAR

Strafford

Last Issue's Most Popular Items

Text of IRS Final Regs: Required Minimum Distributions

Internal Revenue Service [IRS]

Text of IRS Notice of Proposed Rulemaking and Notice of Public Hearing: Required Minimum Distributions

Internal Revenue Service [IRS]

DOL Proposes Exemption for Pension 'De-Risking' with Captive Insurer

Groom Law Group

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

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