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Retirement Plan Administrator
Florida Retirement Consultants
in FL, Telecommute

Retirement Plan Administrator
HowardSimon
in IL

401(k) Plan Administrator
TPA
in MA

Senior Consultant, Compliance - Retirement
The Segal Group
in DC, IL, MI, MN, OH

Defined Benefit Consultant
Unified Trust Company, N.A.
in KY

Compliance Services Project Manager
ABG Retirement Plan Services
in IL, Telecommute

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Workplace Compliance Spotlight: Strategies for Surviving Year End Reporting
October 18, 2018 WEBCAST
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Text of PBGC Final Regs: Owner-Participant Changes to Guaranteed Benefits and Asset Allocation

31 pages. "This final rule amends PBGC's benefit payment regulation by replacing the guarantee limitations applicable to substantial owners with a new limitation applicable to majority owners. Additionally, this final rule amends PBGC's asset allocation regulation by prioritizing funding of all other benefits in priority category 4 ahead of those benefits that would be guaranteed but for the new limitation. The rulemaking also clarifies that plan administrators may continue to use the simplified calculation in the existing rule to estimate benefits funded by plan assets. Finally, it provides new examples to aid in implementation." Pension Benefit Guaranty Corporation [PBGC]

Navigating Retirement Plan Sponsors to Achieve Better Outcomes

Are you concerned about effectively managing every task associated with sponsoring your 403(b), 457 or 401(k) plan? Let PlanPILOT help. We offer independent, unbiased assistance to control retirement plan risks & deliver solutions effectively.

IRS Updates EPCRS Plan Correction Procedure

"The new electronic VCP submission must include many of the same documents as a paper VCP submission, but there are procedural differences ... [D]ocuments relating to the VCP submission ... must be converted into a single PDF document and then uploaded onto the pay.gov website.... [T]here is a 15 MB size limitation for uploading a PDF document ... [T]here are new procedures relating to the payment of user fees using the pay.gov website[.]" Bradley

PBGC Issues Final Rules on Facilitated Mergers of Multiemployer Plans

"Sponsors of plans considering a merger or transfer of assets and liabilities will not have to alter their planning to reflect the proposed new solvency requirements or the other proposed changes to the existing rules. Plans that are critical and declining may well wish to explore the possibility of merging with a sister plan that is better funded and request financial assistance.... Given the current state of the PBGC's multiemployer program, which is facing insolvency, there may likely not be sufficient funds available to assist smaller and possibly even medium sized plans for whom a facilitated merger would avoid insolvency." Cheiron

Earnings on Corrective Contributions: When and How to Calculate

"[T]he majority of plans with which administrators deal with are participant-directed. Your first option is always to go with actual earnings based on the participant-chosen investments.... You may use the Online Calculator only if it is possible to make a precise calculation, but the probable difference between the actual earnings and the Online Calculator is insignificant and the administrative cost of the actual calculation would significantly exceed the probable difference. You can also use the Online Calculator if it is simply not possible to make a precise calculation." Ferenczy Benefits Law Center

House Approves Retirement Legislation

"R. 6757, the 'Family Savings Act of 2018,' includes ... many components of Senate Finance Committee Chairman Orrin Hatch's, R?Utah, Retirement Enhancement and Savings Act (RESA).... [It] is possible that the Senate will choose to conference with the House on this one bill ... The Family Savings Act would amend several retirement plan tax code rules to support pooled employer plans and relax nondiscrimination rules for closed defined benefit plans. It would also create new tax-preferred Universal Savings Accounts." Buck

SPARK Forum - November 4-6, 2018 -- The Breakers, Palm Beach, FL

Join us at the retirement services industry's leading event for top marketing, sales, administration and record keeping professionals. Comprehensive agenda includes topics of interest to Record Keepers, 401(k) Plan Providers, Financial Advisors and Cyber Security Professionals.

A Retirement Security Retrospective: 2007 Versus 2017 (PDF)

40 pages. "The Great Recession officially lasted from December 2007 to June 2009 but its after effects continue to linger today. Questions continue to be asked about the status of the recovery among employers and workers. How has retirement security changed? What are areas in need of improvement? TCRS prepared this report based on findings from its annual retirement survey of workers and employers to help answer these questions." Transamerica Center for Retirement Studies

Private Industry Worker Access to Defined Contribution Retirement Plans

"In March 2018, 51 percent of private industry workers had access to only defined contribution retirement plans through their employer. An additional 13 percent had access to both defined benefit and defined contribution retirement plans at their workplace, while 4 percent of private industry workers had access to only defined benefit retirement plans.... The access rates for defined contribution only plans were 31 percent for part-time workers and 58 percent for full-time workers in private industry in March 2018. An additional 4 percent of part-time workers had access to both defined benefit and defined contribution plans; 16 percent of full-time workers had access to both types of retirement plans." U.S. Bureau of Labor Statistics [BLS]

Another 403(b) Plan Sponsor Beats Back Fee Lawsuit

"The Washington University lawsuit, which was filed in June 2017, alleged that the university violated its fiduciary duty to the plan by causing participants to overpay for record keeping and administration and investment management, as well as failing to address fund underperformance." [ Davis v. Washington Univ. in St. Louis , No. 17-1641 (E.D. Mo. Sept. 28, 2018)]
InvestmentNews

Merrill Lynch Returns to Commissions

"Merrill Lynch will again accept commission-based individual retirement accounts ... Only fee-based annuities will be allowed ... [A]ccording to Merrill Lynch [a]nnuities are complex, and a fee-based advisory platform is the best way to serve advisors who have clients with annuities in their IRAs." InsuranceNewsNet.com

SOA Exposure Draft: Pub-2010 Public Retirement Plans Mortality Tables

"The Society of Actuaries' Retirement Plans Experience Committee (RPEC) has released an exposure draft of the Pub-2010 Public Retirement Plans Mortality Tables. The primary focus of this study was a comprehensive review of recent mortality experience of public retirement plans in the United States.... The SOA solicits comments on this exposure draft. Comments should be ... [submitted] by October 31, 2018." Society of Actuaries

FAS87 ASC715 Discount Rates and Moody's Rates, Updated September 30, 2018

An unofficial monthly report as of August 31, 2018, of the Moody's Daily Long-term Corporate Bond Yield Averages and Moody's Daily Treasury Yield Averages (used as benchmarks by some corporate pension plans). David Rigby, via BenefitsLink Message Boards

When Must a Fiduciary Say 'No' to No-Fee Funds?

"These funds are being labeled 'no-fee' because they have no management fee and no transaction fee. They also have no minimum investment.... With financial markets near all-time highs as they are now, a taxable investor could realize capital gains and incur tax costs that are significantly higher than the potential savings of a few basis points of moving to a slightly less expensive Fund. This is self-defeating and is missing the proverbial forest for the trees, as they say." Fiduciary News

Employee Benefits in the Supreme Court: October 2018 Update (PDF)

32 pages. "[T]he Court has been concerned with who can bring claims involving employee benefits, what kind of claims can they bring, what kind of remedies can they seek -- issues uniquely in the purview of courts, as distinguished from plan sponsors, administrators, fiduciaries or regulators -- and whether State laws implicating employee benefits will be enforced, as frequently as it has considered substantive issues affecting employee benefits. Of the 129 cases, 69 involved retirement arrangements, 33 involved health plans, 19 involved disability benefits, and 15 involved life insurance, leave or fringe benefit arrangements." Eversheds Sutherland

Success Factors for Small Employer Non-Qualified Plans (PDF)

"Fancy, complicated designs that involve multiple in-service distributions, a variety of choices for deferral or distribution elections, and complex crediting sound great, but are often misunderstood and ultimately work against the plan and its participants.... In the tax-exempt world the pure non-qualified options are 457(b) or (f) plans.... For some small employers, plan document sticker shock can also come into play." Gallagher

Excise Tax for Nondeductible (Excess) Contributions

A plan made a profit sharing contribution to the 2017 calendar year plan that utilized incorrect compensation during nondiscrimination testing. Let's say this contribution was $50,000. When the nondiscrimination was corrected, the correct allocation should have been $10,000. So $40,000 was forfeited for use in future years. The problem here was the tax deductible contribution threshold for 404 lowered to $40,000 from its original amount of $160,000. Is there a way to avoid paying excise taxes on Form 5330 for $10,000 of contributions that were over and above the 404 limit? BenefitsLink Message Boards

Governmental Plan: Spousal Consent Needed Before Naming Non-Spouse Beneficiary?

The terms of a governmental 457(b) plan document do not require spousal consent to name a non-spouse beneficiary. So the only other relevant rule (it seems to me) would be 401(a)(11), which requires spousal consent as part of naming non-spouse beneficiary for exception of QJSA/QPSA requirements. Section 401(a)(11) does not apply to governmental plans or 457(b) plans. So no requirement for spousal consent to name non-spouse beneficiary, here, correct? BenefitsLink Message Boards

Allocating Contribution to Correct Late Employee Contributions

So say you have a fairly large 401(k), 100's of employees. CPA says that employee contributions should have been made, say, within 2 days of payroll date. That's reasonable. Most were, but some were made 3, 4, 5, or in one case 8 days later. Out of 24 payroll dates, maybe 10 have a problem. You calculate the lost interest and it is, say, in the 10's of dollars for each payroll, maybe $1,000 for the entire year. DOL's VFCP Notice says the correction is to contribute the "Lost Earnings." So you contribute the $1,000. Now how do you allocate it? BenefitsLink Message Boards

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Press Releases

Sage Rutty Retirement Plan Services Group is Certified for Fiduciary Excellence Centre for Fiduciary Excellence [CEFEX]

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Most Popular Items in the Previous Issue

Helping Employees to Financial Wellness: Using a 401(k) Plan to Incentivize Employees to Reduce Their Student Loan Debt Milliman

IRS Retirement Plan Correction Program to Go Paperless Kilpatrick Townsend

Notes from Meeting of Actuaries 'Intersector Group' with PBGC, April 4, 2018 (PDF) American Academy of Actuaries, Conference of Consulting Actuaries, Society of Actuaries, and ASPPA College of Pension Actuaries [ACOPA]