Rev. Dec. 2024. "What's New: The form and instructions have been updated to include 403(b) plans."  MORE >>

"Although plan amendments for LTPT rules are not required until the end of the 2026 plan year, 403(b) plan operations must be compliant by January 1, 2025.... [E]mployers can amend their plan by January 1, 2025, to provide that all part-time employees are immediately eligible for deferrals, and avoid having to administer the LTPT rules."  MORE >>

"The court reasoned that a plaintiff was permitted but not required 'to point to a higher-performing fund ... to demonstrate imprudence.' The critical question was whether the plaintiff had pled 'facts sufficient to give rise to an inference of insufficient process.' ... Given the allegations that the Plan ranked as one of the largest defined contribution plans in the country, the court found plausible the allegation that the Plan had the 'bargaining power to obtain share classes at far lower rates,' even if it did not meet the threshold investment levels for each such share class." [Johnson v. Parker-Hannifin Corp., No. 24-3014 (6th Cir. Nov. 20, 2024)]  MORE >>

"In a ruling that a dissenting opinion says 'weakens an important mechanism' to stop costly litigation over 'meritless claims' -- a federal appellate court has given new life to an excessive fee suit.... For those who have been tracking the remarkable success of the CommonSpirit decision's effectiveness in producing several notable dismissals, this ruling in the same federal court district seems a bit of a head-scratcher." [Johnson v. Parker-Hannifin Corp., No. 24-3014 (6th Cir. Nov. 20, 2024)]  MORE >>

"There are currently 40 national record keepers and hundreds of local ones, which means firms ... that do not have scale or a unique distribution or service model are likely to be acquired.... While advisors bombard [those] clients, and the current RPAs ... will do everything to retain the client, even after an acquisition, DC plans with less-than-stellar advisors who did not go through the required RFP process before they accepted the acquiring provider create innumerable opportunities."  MORE >>

"[I]nsurance companies disbursed $104 billion in annuity benefits last year, the most ever recorded and a 9% increase compared to 2022.... [A] greater number of workers and retirees are also adding their savings to annuity features. According to the ACLI, premiums paid by annuity owners in 2023 totaled $361 billion, a 3% rise compared to last year."  MORE >>

"As defined contribution plans have taken over for defined benefit plans over the first 50 years of the landmark legislation, enabling increased access to 401(k)s, more personalization, better use of auto features and retirement income are among the key issues ERISA is expected to face looking forward."  MORE >>

"Frictionless account consolidation can be done. It would improve retirement security for savers nationwide by reducing cash-outs and lost accounts, improving investment allocations, avoiding multiple account fees, and supporting the wider adoption of retirement income solutions. Plan administrators would benefit by having fewer but larger accounts to administer. Policymakers would also benefit by improving the retirement readiness of millions of workers and reducing the potential burden on public finances of an aging population."  MORE >>

"[R]egulators have been busy issuing much-needed guidance ... relating to [1] implementing penalty-free withdrawals for emergency personal expenses and domestic abuse distributions, [2] the RMD rules, and [3] implementing the long-term, part-time employee (LTPT) rules, among others.... Health and welfare plans have seen a significant uptick in the amount of new guidance compared with a typical year.... [A] number of lawsuits filed against retirement plan sponsors alleging violations of fiduciary duties with respect to the use of retirement plan forfeitures.... As with retirement plans, health and welfare plans are subject to fiduciary duties under ERISA."  MORE >>

"Form 15620 is a straightforward form that taxpayers can use to make a section 83(b) election. The form is available for use immediately, though taxpayers may still opt to file their own form ... The form must be filed within 30 days after the date the property is transferred, and a copy of the form must be furnished to the person for whom the services are performed."  MORE >>