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Pension Standards of Practice - Canada and U.S.
November 28, 2018 WEBCAST
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Plan Amendments: Procedures, Timing & Other Issues [2018]
December 6, 2018 WEBCAST
FIS Relius Education

IRA Reporting
December 11, 2018 WEBCAST
Ascensus

IRA Required Minimum Distributions
December 13, 2018 WEBCAST
Ascensus

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DOL RCH Advisory Opinion Illustrates the Difficulties Inherent to Bulk IRA/Auto Portability Programs

"IRAs are individually owned investment contracts, which are under the control of the former participant -- even though they are set up by the former employer.... [T]he DOL made it clear that negative consent will not suffice to relieve the program's sponsor from the fiduciary obligations related to the decision to move the money from the IRA to the new plan.... Then there is that nasty problem of securities laws and other state laws ... The question ... is how a fiduciary which is not appointed by the individual IRA holder has any legal authority to do ANYTHING with a registered security (or even any other investment) after it is set up by the original employer, as the investments are legally owned by the former participant." Business of Benefits

The Best Software deserves the Best Support!

DATAIR offers the best combination of Software and Support for DB, DC, Cash Balance and Combined Plan Proposals, Testing and Administration. Also Plan Documents, 5500s and 1099Rs. Call us at 888-328-2474 or visit www.datair.com for more information.

Select Limits, Hardship Withdrawal Changes and a Rollover Automation Option

"[T]he employer or plan sponsor needs to contact its plan's record keeper to determine when their system might be updated to accommodate the new options under the proposed regulations. Some of the provisions in the proposed regulations can be effective earlier than Plan years beginning on or after January 1, 2020, but the systems need to be ready to support the plan changes and record keepers may wait for final regulations before commencing the programming changes." Winstead PC

Nonqualified Deferred Compensation Rules for Tax-Indifferent Entities Under Section 457A

"This practice note explains the application of Internal Revenue Code Section 457A, which restricts the ability of certain tax-indifferent entities (so-called nonqualified entities) to defer compensation for services provided by their service providers. It provides guidance on practical steps for attorneys advising such entities on nonqualified deferred compensation plans." Venable LLP

2018 ERISA Advisory Council Recommendations to DOL: Executive Summary (PDF)

" Evaluating the Department's Regulations and Guidance on ERISA Bonding Requirements and Exploring Reform Considerations : The Council recommends that the Department publish the following new guidance ... [1] A new Interpretive Bulletin, incorporating much of the content of its 2008 Field Assistance Bulletin 2008?04. [2] A summary of the requirements for securing a fidelity bond that complies with the Department's guidance....

" Lifetime Income Solutions as a Qualified Default Investment Alternative (QDIA) : [1] Amend the QDIA regulations to address using [lifetime income (LTI)] in a QDIA.... [2] The Department should publish guidance confirming that a named plan fiduciary may appoint a 3(38) investment manager to select and monitor annuity and other LTI options for DC plan decumulation, as well as accumulation.... [3] The Department should encourage plan sponsors to adopt plan design features that facilitate LTI, including, but not limited to: allowing participants to take ad hoc distributions, enabling installment payments, providing Social Security bridge options and allowing for payment of required minimum distributions."
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

DOL Considers Important Efficiencies for the Retirement System (PDF)

"The first initiative clarifies and liberalizes the conditions for multiple employer retirement plans (MEPs) under the existing provisions of [ERISA].... The second initiative considers auto-portability ... By providing an automated means for participants to preserve and consolidate their retirement savings in a single account as they change employment, auto-portability is intended to improve the quality and quantity of retirement savings." Eversheds Sutherland

Join the Pension Rights Center's no-fee lawyer referral service!

Are you an experienced attorney who can handle issues involving private and government retirement plans? Join our no-fee National Pension Lawyers Network ! There is no obligation to take any case we refer to you. Join our network!

DOL Proposes Prohibited Transaction Exemption Allowing Vendor's Automatic Account Transfers

"RCH is constructing a system to share data on 401(k) participants with recordkeepers to find a departing employee's new plan and facilitate the transfer.... RCH plans to charge a maximum one-time fee of $59 for each transfer. For accounts with $590 or less, the charge will be 10 percent of the balance, and the service is free for accounts with $50 or less. There also is a 20-percent reduction in the fee charged to a plan when the annual volume of roll-in transactions exceeds 1 million transactions per year, meaning the benefits of scale are passed on to participants in the form of reduced fees[.]" HR Daily Advisor

Making Sure 401(k) and 403(b) Fees Are 'Necessary' and 'Reasonable', Part 2

"[Budget] four-to-six weeks for your review of the responses.... [S]ince all of the responses on pricing in particular will almost certainly not be uniform or completely clear, you'll need time to analyze, ask questions and assess. You should create a master list of items you want to see addressed by each respondent. This can, essentially, be the items in your RFP. You'll want to create a fairly detailed spreadsheet to analyze the fee component of the proposals." Fiduciary Plan Governance, LLC

QDIAs, New Mortality Table, and Distributions as a Compliance Target

"In October 2018, the Society of Actuaries published its new Mortality Improvement Scale MP-2018, showing mortality improvement rates that are 'slightly lower than the corresponding Scale MP-2017 rates.' ... Presumably, IRS will not take into account the new SOA MP-2018 scale until sometime later this year or next, for purposes of 2020 valuations.... Plan distributions are a 2019 IRS 'compliance' target." October Three Consulting

Fiduciary Liability Claim Trends (PDF)

10 pages. "While insurers have not reacted in a unified way, the claim environment has become much more active and severe during the past 24?36 months, highlighted by well-publicized excessive fee litigation under ERISA. This ... report discusses ... the many excessive fee cases brought against universities, why proprietary funds are more challenging risks, and recent results from a Boston College study examining the causes and consequences of 401(k) lawsuits." Lockton

Analysis Says Multiemployer Loan Program Will Not Help All

"The loan program idea introduced in legislation earlier this year is considered a way for some critically underfunded plans to extend projected insolvency dates and reduce the risk to the PBGC.... The analysis used 500 trials with asset returns varied stochastically to model plans projected to become insolvent within 30 years. According to the analysis, the average total number of participants in plans projected to become insolvent is 3.1 million in the baseline scenario, and 2 million if the loan program is implemented."
Pensions & Investments

The Frozen Plan Equation -- Don't Forget the Denominator

"In this period of rising interest rates, managers of frozen plans will want to be sure their hedge ratio is consistent with both their capital market views and their investment policy, rather than a residual of past allocations.... By planning ahead and anticipating the likely future development of the fund value, plans can make appropriately sized commitments to illiquid assets and avoid overallocation a few years down the road--a condition that can be difficult to remedy." Russell Investments

Time for Select Pension Committee to Shine as Midterms' Afterglow Dims

"When Congress passed a law back in February creating the Joint Select Committee on Solvency of Multiemployer Pension Plans, it gave the committee until November 30 to find a bipartisan solution to a looming plan insolvency crisis.... Congressional leaders set the committee's deadline after the election to ensure that committee members had several weeks to operate in a low political pressure environment to reach across the political divide and broker a compromise solution. That time has arrived, and affected retirees are keenly aware of the opportunity it presents." Pension Rights Center

Big Data, Big Changes for Insurance and Pensions (PDF)

"Because it involves the storage and analysis of large volumes of information, Big Data is creating new opportunities for efficiency and innovation in the insurance and pension sectors. At the same time, Big Data has the potential to disrupt the way insurance and pensions are traditionally marketed, designed, and sold to consumers. As advancements in data analysis and storage continue to evolve, actuaries will play an important role in helping insurers and pension plan sponsors navigate the opportunities and challenges posed by Big Data." American Academy of Actuaries

Comment Letter to IRS on Notice 2018-68 and Section 162(m)(3) Definition of Covered Employee (PDF)

" Notice 2018?68 proposes a definition of 'covered employee' that contradicts the statutory text, as revised by the Tax Cut and Jobs Act (TCJA). Specifically, the Service disregards statutory language requiring that a 'covered employee' be an 'employee' -- i.e., an individual who is an employee at some point during the tax year.... As a result of this plain meaning, payments delayed until after the year in which a covered employee ceases to be an employee should not be subject to Section 162(m)'s deduction limit. These include the vast majority of non-qualified retirement plans, severance arrangements, and equity pay exercised after termination of employment." [Also available: Executive Summary .]
Ivins, Phillips & Barker

Safe Harbor Nonelective Contribution Deposit for 2017 Plan Year Not Made Until Now

Plan sponsor has not made their safe harbor non-elective contribution deposit for the 2017 Plan Year. They have until 12/31/18 to make the deposit and keep the safe harbor status for 2017, correct? I'm not sure if they deducted it on their 2017 tax return, but it would not have been deductible since it was not made by their 2017 tax filing deadline. [1] Is it deductible for 2018? [2] Do we have to apply lost earnings? BenefitsLink Message Boards

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Year-End Financial-Planning Content At myStockOptions.com Explains The Impacts Of Tax Reform myStockOptions.com

Three New Members Elected to AHIP Board of Directors America's Health Insurance Plans [AHIP]

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Most Popular Items in the Previous Issue

IRS Releases Proposed Hardship Distribution Regulations Seyfarth Shaw LLP

401(k) Plan Administration Checklist for the 2019 Plan Year Employee Fiduciary

IRS (Finally) Answers Questions About 2019 Hardship Distributions Spencer Fane