"Form 8717-A is now used only to make an additional payment when an insufficient user fee was paid for an opinion letter application submitted on Form 4461, Form 4461-A, Form 4461-B, or Form 4461-C. Form 8717-A is no longer attached to those forms because the initial user fee payments are made through www.Pay.gov."  MORE >>

"Query whether a qualified student loan matching program will replace the need for an existing tuition reimbursement program.... Employers will need to weigh this advantage with the additional administrative complexity of administering such a program, including its certification requirements and ADP testing decisions, along with a comparison of the cost of making matching contributions versus tuition reimbursement expenses, if any."  MORE >>

"[Notice 2024-63] requires that a participant must be legally obligated to make loan payments and must actually make those payments to qualify for the QSLP match.... Regardless of who received the education, only payments made by the participant qualify as QSLPs.... [Because] many service providers require plan sponsors to submit annual census data within 30 days of the end of the plan year to guarantee that testing will be done before the 2½ month excise tax deadline, a 30-day deadline for QSLP reporting may be desirable. Whether this is acceptable to the IRS as a 'reasonable deadline' remains to be seen."  MORE >>

"[T]here are two separate and different sets of rules for recommending rollovers into annuities -- one for insurance-only annuities and one for securities annuities. The former does not appear to require consideration of the participant's interest in that plan and whether it is in the participant's best interest to leave the money in the plan.... The latter requires consideration of possibly leaving the money in the plan and then determining if the services, investments and costs in the rollover IRA are better for the participant."  MORE >>

"[A] federal district court ruled in favor of the DOL and upheld the ESG rule, relying on Chevron deference. The plaintiffs appealed to the US Court of Appeals for the Fifth Circuit, which heard oral arguments in the case on July 9 (11 days after the Supreme Court decision in Loper Bright). On July 18, a mere nine days after the oral argument, the Fifth Circuit remanded the case to the federal district court to reconsider and to apply the district court's 'independent judgment' to the issue, rather than defer to the DOL's interpretation." [Utah v. Su, No. 23-11097 (5th Cir. Jul. 18, 2024)]  MORE >>

"The Office of the Solicitor General has not decided whether to appeal a stay freezing the [DOL's] latest attempt to expand fiduciary duty.... Attorneys for both plaintiffs and defendants jointly asked [district court judge Jeremy D. Kernodle] to extend the stay to the government's 'deadline to answer or otherwise respond.' ... Judge Kernodle granted the request[.]" [Federation of Americans for Consumer Choice Inc. v. DOL, No. 24-0163 (E.D. Tex. order staying answer deadline Sep. 3, 2024)]  MORE >>

"On July 25, 2024, the U.S. District Court for the Eastern District of Texas issued a stay siding with the insurance industry plaintiffs and enjoining the DOL from enforcing the Final Rule on its effective date of Sept. 23.... On July 26, 2024, the Northern District Court also issued a stay that incorporated the Eastern District's holding but went further and extended the stay to the prohibited transaction exemption changes made under the Final Rule.  ... It appears that the DOL's fourth attempt to expand the fiduciary definition under ERISA could very well suffer the same fate as the previous three attempts."  MORE >>

"If the employer-sponsor of an eligible 457(b) plan changes its status as a governmental or tax-exempt entity, the eligible 457(b) plan will become an ineligible 457(f) plan, with potentially drastic consequences for participants. An employer faced with a change in status must be alert to this problem and take action before the status change occurs."  MORE >>

"[A] new analysis of the drivers of U.S.-based defined contribution recordkeeping costs suggests that higher balances may not necessarily lead to lowers costs. In fact, according to the study ... factors such as economies of scale, managed accounts, and proprietary investment options ... together explain about 25% of the variance in cost ... [R]ecordkeeping costs in the firm's $1.3 trillion DC database range from $20 to $80 per participant annually."  MORE >>

"[P]lan advisers [should] be proactive in helping their plan sponsor clients prevent human error-related security incidents. This requires the design and establishment of a robust data governance and controls program with clearly defined access controls across all processes and reports. Plan fiduciaries should also consider investing more in automating tasks that use personal data and make sure all data is encrypted from start to finish for better security. Additionally, training and awareness about appropriate use of data continue to be critical."  MORE >>

"The aggregate funded ratio for U.S. corporate pension plans increased by an estimated 0.4 percentage points in August, ending the month at 102.3% ... This month's change in funded ratio resulted from a 1.7% increase in asset value slightly offset by a 1.3% increase in liability value. The aggregate funded ratio is estimated to have increased by 6.5% year-to-date, but decreased by 2.3% over the trailing twelve months."  MORE >>

"The legal 'safe harbor' for annuities in the SECURE Act of 2019 ... doesn't give plan sponsors much guidance in sifting through the many types of annuities and their often-complex product designs.... '[E]mployers have no incentive to contribute to the accounts of high-turnover workers.... Assuming that many people will need to keep at least half their DC savings more or less liquid in retirement, there won't be enough left to buy a meaningful guaranteed income stream.... Not all 401(k) income products are equal.... Possible blowback from benefits paid for but not received ... Portability issues still unsolved."  MORE >>

"[If] your severance arrangement is in written form (including multiple employment contacts providing severance benefits) and involves employer discretion as to benefit amounts and employee eligibility, it is likely to be a 'plan' for ERISA purposes. That can be a major compliance problem only if your severance plan also is a 'pension plan' for ERISA purposes. Fortunately, there are hard and fast guidelines under [DOL] regulations that clearly outline how to structure a severance benefit arrangement so that it is not a pension plan."  MORE >>

"ERISA has largely succeeded in establishing a more reliable, pension and benefits system that applies uniformly across the country.... In recent years, significant legislation has further shaped the landscape of employer-sponsored health and welfare plans, reflecting ongoing efforts to enhance transparency and protect beneficiaries.... Ongoing legislative and regulatory efforts will be crucial in refining and modernizing ERISA to meet the evolving needs of today's workforce. The goal should be to maintain ERISA's foundational commitment to protecting employee benefits while remaining responsive to the changing demands of the benefits landscape."  MORE >>