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    February 10, 2003 - 12,861 subscribers
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    New Savings Plans Wouldn't Be for Everybody
    Excerpt: "[A] dollar in hand today is worth more than a dollar that will show up in the future. And some of the current tax-advantaged plans do offer that dollar now, when it's worth more." (New York Times; one-time registration required)

    Opinion: Bush Proposals for Savings Offer Solid Financial Benefits
    Excerpt: "[T]he Lifetime Savings Account, the Retirement Savings Account and the Employer Retirement Savings Account ... are worth taking a look at since they hold the promise that saving could become easier and, at the same time, provide substantial tax benefits for those who sign on." (Eileen Alt Powell of the Associated Press via the Pittsburgh Post-Gazette)

    Bush Proposal is Complex Way to Simplify Savings
    Excerpt: "Let's make the naive assumption that Congress approves all three accounts without imposing any income limits, phase-in periods or special rules for guys who wear polka-dotted boxers. People who are just starting to save would find the new choices far simpler than the exasperating array of options that exist today." (San Francisco Chronicle)

    Critics Say New Accounts Won't Boost Savings
    Excerpt: "Critics of President George W. Bush's proposed new savings accounts argue they may not boost savings after all. The proposals may have the opposite effect of inducing small businesses to either drop or not sponsor new retirement plans." (Dow Jones via Quicken Brokerage)

    Opinion: Proposed 'Savings Incentives' Would Cause Revenue Hemorrhage In Future Decades
    Excerpt: "On January 31, the Administration unveiled a package of dramatic proposals that ultimately would shield from taxation a large share of all income earned on savings and investments.... While the proposal is being touted as a way to increase national saving and to help workers save for their retirement, in fact the proposal may have the opposite effects." (Center on Budget and Policy Priorities)

    Commentary: A Wealth of Qualms on Bush's Savings Proposals
    Excerpt: "Aside from the problems these accounts might create in funding the government-- hey, maybe you thought it was Karl Marx who wanted the state to wither away-- they would shift the tax burden dramatically toward wages and consumption. Much investment income would be left untaxed.... Republicans in Congress are putting out the word that they have no interest in enacting these accounts." (Albert Crenshaw in the Washington Post)

    ERSA and the 457(b)
    Excerpt: "Employees who contribute to a governmental 457(b) plan currently have some fantastic special provisions available only to them. ERSA would end this. In its place would be one plan with one set of rules for all. The reality is that very few folks take advantage of the special provisions in a 457(b)." (403bWise.com)

    The $550,000 Loophole In Bush's Saving Plan
    Excerpt: "With some care, you could put $550,000 away and never have to pay taxes on the earnings of the stash. Let's look at what's been proposed, and how you could reap the most gain if these new tax-advantaged plans are passed into law." (CNBC via MSN Money)

    Building a Better 401(k)
    Excerpt: "401(k) plan sponsors are taking steps to make their plans more attractive to employees in 2003." (BusinessFinanceMag.com)

    Pace of Catch-Up Contributions Lags
    Excerpt: "Preliminary reports indicate that few older employees have taken Congress up on a lucrative opportunity to store away more savings for retirement through catch-up contributions. Still, many observers are optimistic that employees will pick up the pace." (BenefitNews.com)

    Rush Is On to Build Up Pension Assets
    Excerpt: "Companies are pouring millions in cash and stock into their ailing pension plans, many of which are underfunded for the first time in nearly a decade. Technically, they don't have to pony up. They are doing it to avoid alarming investors and to avoid taking charges to equity." (Dow Jones via StarTribune.com)

    Another Question is Answered in the Who's the Employer Q&A Column
    Derrin, you appeared with Richard Wickersham of the IRS at the Los Angeles ASPA Benefits Conference in a discussion of Rev. Proc. 2002-21. Did Dick make any comments that would add to our understanding of how the IRS will treat PEOs? (BenefitsLink.com)

    Lawsuit Adds to Turmoil at Federal Government's Thrift Savings Plan
    Excerpt: "The recently departed executive director of the board that oversees the Thrift Savings Plan, a retirement fund for federal employees, is suing the board's new Bush administration appointees alleging they are, for political reasons, trying to undermine a pending fraud lawsuit against a well-connected computer contractor." (Washington Post)

    Corporations Feel Pinch from Underfunded Pension Plans
    Excerpt: "Facing rising pressures from the economic downturn and an aging workforce, the number of companies with underfunded pension plans is growing fast. Now, those pension problems are beginning to have a real impact on corporate earnings." (Chicago Tribune via NewsAlert.com)

    Links to Items on Executive Comp, Benefits in General

    Auditor-Accountants' Close Link to Executives Is Questioned
    Excerpt: "For more than a year, critics have warned that the more money accountants receive for nonaudit work, the more likely they are to let their evaluations of corporate finances be swayed.... The S.E.C. adopted rules just weeks ago restricting the kinds of services that accountants can sell to the companies that they audit. Though the agency requested comment on potential restrictions on services sold to corporate executives, few focused on the issue and no rule has yet been proposed." (New York Times; one-time registration required)

    Opinion: Corporate Fat Cats Getting Even Fatter
    Excerpt: "The startling hike in CEO pay, which has gone from 42 to 400 times that of the average worker in the past two decades, is 'terribly bad social policy and perhaps even bad morals,' William McDonough, president of the Federal Reserve Bank of New York, has said.... There's no sign yet, though, that CEOs and their boards have gotten religion about a genuine pay-for-performance culture." (David Olive in the Toronto Star)

    Costly Questions Arise on Legal Opinions for Tax Shelters
    Excerpt: "Like sellers of treasure maps, promoters of tax shelters promise that for a large fee one can navigate a secret route. What clinches these deals is not the chart itself but a second document that appears to warrant that the map is as good as gold. That document is called an opinion letter and it blesses the tax shelter as a legitimate way to reduce taxes." (New York Times; one-time registration required)

    Opinion: Nasdaq Letter to Accounting Board on Stock Options Betrays Best Interest of Shareholders
    Excerpt: "If Nasdaq had a Minister of Common Sense, a recent letter by its vice chairman, Alfred Berkeley, would've never seen the light of day. Berkeley sent it to the Financial Accounting Standards Board (FASB) in response to its request for public comment on a proposal to consider the expensing of stock options put forth by the International Accounting Standards Board (IASB)." (Bill Mann of the Motley Fool via Yahoo! Finance)

    Commentary: Stock Options-- Boon or Simply Boondoggle?
    Excerpt: "Corporate America thinks the granting of stock options entitles companies to deduct the value of exercised options from corporate taxes. But conveniently, companies don't claim options as an expense. Why should the corporations get both?" (Bill Fleckenstein on CNBC via MSN Money)

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    Newly Posted Webcasts
    ( Post Yours! )

    HIPAA: The Eleventh Hour
    on February 20, 2003
    presented by International Foundation of Employee Benefit Plans

    Participant Loans
    on February 24, 2003
    presented by ASPA
    Newly Posted Conferences
    ( Post Yours! )

    Legal Issues in the Medical Errors Debate
    in ALL STATES
    February 14, 2003
    American Health Lawyers Association
    Newly Posted Press Releases
    ( Post Yours! )

    HIPAA: The Eleventh Hour -- Teleweb Seminar Clarifies Compliance Requirements
    (International Foundation of Employee Benefit Plans)

    Labor Department Proposes Class Exemption On Settlement of Litigation
    (U.S. Department of Labor, Employee Benefits Security Administration)

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