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COLLECTED WISDOM™ on Compliance and Regulatory Related Issues

This page gathers relevant information for 401k plan managers, sponsors, administrators, recordkeepers and others with plan fiduciary and administrative responsibilities. It covers many aspects of compliance and regulatory related issues.

This archive contains not only the most current material on the topic, but also older items that are still relevant, provide background, perspective or are germane to the topic.

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Delaying the Inevitable: Required Minimum Distributions for DC Plans

Abstract: The rules governing required minimum distributions are complex, and exceptions to the rules abound. Plan sponsors should check their plan document to be sure RMDs are in operational compliance. Additionally, plan sponsors should educate account holders about the rules related to RMDs so that account holders are aware of tax implications and potential penalties related to RMDs. This article provides an in-depth look at RMDs.

Source: Findleydavies.com, November 2017

Updated List of Required Modifications for DC Plans

Abstract: The IRS releases its updated list of required modifications for defined contribution plans. The information package contains samples of plan provisions that have been found to satisfy certain specific requirements of the Internal Revenue Code, taking into account changes in the plan qualification requirements, regulations, revenue rulings, and other guidance.

Source: Benefitsforward.com, November 2017

Are You Up-to-Date on Qualified Plan Beneficiary Rules?

Abstract: Most TPAs don't wake up first thing in the morning thinking about qualified plan beneficiary rules. However, improper payments due to lack of knowledge about these rules can have unwanted consequences. As the first in a series, this article covers the basic rules of the spouse beneficiary requirement for qualified plans.

Source: Penchecks.com, November 2017

The Perils of Missing Participants

Abstract: Sponsors of retirement plans are well aware of the annoyances associated with missing participants. However, there may also be associated legal perils. An October 2, 2017 letter from the American Benefits Counsel to Tim Hauser at the Department of Labor, outlines the aggressive legal positions recently taken by DOL investigators with respect to missing participants.

Source: Wifilawgroup.com, November 2017

Qualified Retirement Plan Amendments: 2017 Year-End Update

Abstract: This advisory reminds plan sponsors of deadlines for amending qualified retirement plans and certain year-end legal updates.

Source: Alston.com, November 2017

The Elusive IRC Section 410(b)(6) Transition Rule

Abstract: One of the most confusing parts of working with retirement plans occurs when the plan sponsor buys another company. This article reviews one aspect of the rules relating to transactions, which is commonly the key to a successful handling of benefits matters in M&A, and is also commonly misunderstood: The IRC Section 410(b)(6) Transition Rule.

Source: Ferenczylaw.com, November 2017

Year-End Compliance Issues for Single-Employer Retirement Plans

Abstract: By year-end 2017, sponsors of calendar-year single-employer retirement plans must adopt necessary and discretionary plan amendments to ensure compliance with the statutory and regulatory requirements of ERISA and the tax code. This bulletin looks at key areas -- including administrative compliance issues -- that sponsors of such DB or DC plans should address by December 31, 2017.

Source: Milliman.com, November 2017

Cashing-Out Terminated Employees From Your Company's Retirement Plan

Abstract: This article focuses on one aspect of the employment termination process as it relates to defined contribution retirement plans. More specifically, it examines the involuntary cash-out provisions included within most DC plans.

Source: Legacyrsllc.com, November 2017

Chapter 13 Debtor Can Put Earnings Into 401k

Abstract: Chapter 13 debtors can deduct 401k contributions in calculating their disposable income that must be contributed to a payment plan, even if they weren't contributing in the six months prior to the bankruptcy, an Illinois bankruptcy judge ruled Oct. 30.

Source: Bna.com (registration may be required), November 2017

More IRS Relief for Hurricane Maria and California Wildfires Victims

Abstract: The IRS has released Announcement 2017-15 detailing more relief available for those affected by Hurricane Maria and the California wildfires. This relief is in addition to previous disaster-related announcements.

Source: Ascensus.com, November 2017

Missing Participants With Unpaid Required Minimum Distributions

Abstract: The IRS publicly released guidance, previously provided to its Employee Plan auditors, establishing the criteria that the auditors should use to determine if a plan under audit has a qualification issue when required minimum distributions (RMDs) under Section 401(a)(9) of the Internal Revenue Code have not been timely paid to missing participants.

Source: Sibson.com, October 2017

Missing Participants and Beneficiaries and Required Minimum Distributions

Abstract: This IRS memorandum directs EP examiners not to challenge a qualified plan as failing to satisfy the required minimum distribution standards under Internal Revenue Code Section 401(a)(9) in the circumstances set forth in the memorandum.

Source: Irs.gov, October 2017

Paying Employee Benefit Plan Expenses Chart

Abstract: This 6-page chart is a guide for employers to use in determining which types of expenses can be paid from the assets of an employee benefit plan governed by ERISA and the Internal Revenue Code.

Source: Groom.com, October 2017

DOL's Form 5500 Modernization Proposal Faces an Uncertain Future

Abstract: Work on the Labor Department's effort to expand, streamline and modernize the Form 5500 Series has been halted until a new head of the DOL's Employee Benefits Security Administration (EBSA) is in place.

Source: Asppa.org, October 2017

401k and Retirement Plan Limits for the Tax Year 2018

Abstract: On October 19, 2017, the Internal Revenue Service announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for the tax year of 2018. Chart, highlights, and detail.

Source: 401khelpcenter.com, October 2017

Employee Benefit Plans: Mistakes and Available Correction Programs

Abstract: Employee benefit and retirement plans are required to comply with a number of complex laws and regulations, and failure to do so can result in significant penalties and/or disqualification of a plan. Despite best intentions different plan errors can occur. The good news is that there are correction program options available for plan sponsors without sacrificing the qualified status of a plan.

Source: Withum.com, October 2017

IRS Reveals FY 2018 Compliance Priorities

Abstract: In the Internal Revenue Service Tax Exempt and Government Entities FY 2018 Work Plan, the agency revealed efforts it will be making next year to help sponsors achieve compliance for their employee retirement plans. Plan sponsors will have a number of new compliance checks to keep in mind.

Source: Plansponsor.com, October 2017

Internal Controls Policy -- Does Your Plan Need One?

Abstract: Do you wish that you could find a way to avoid plan compliance problems and shorten the length of IRS or Department of Labor plan audits? One compliance tool you can use is an Internal Controls Policy.

Source: 401ktv.com, October 2017

Hurricane Survival Guide for Employee Benefit Plans and Employers

Abstract: This article explores the efforts by the Internal Revenue Service, Department of Labor, and Pension Benefit Guaranty Corporation to grant multiple forms of relief to taxpayers impacted by Hurricane Harvey, Hurricane Irma, and other disasters enumerated by the Federal Emergency Management Agency. This new disaster relief affects health plans, retirement plans, and employers.

Source: Mwe.com, October 2017

Congress Adds Plan Distribution Tax Relief for Recent Disasters

Abstract: The Act includes relief from the 10% premature distribution penalty for withdrawals from retirement savings and provides expanded loan availability to qualified plan participants. It also offers withholding exceptions, delayed taxation, and extended repayment options to ease the financial bite of tapping retirement savings for hurricane recovery.

Source: Conduent.com, October 2017

Hurricane Legislation Grants Retirement Plan Relief

Abstract: Under the provisions of the new law, "qualified hurricane distributions" from IRAs, qualified retirement plans, 403b plans, and governmental 457b plans are entitled to special tax treatment, as well as repayment options if the recipient so chooses. There are also provisions that apply specifically to loans from employer plans.

Source: Ascensus.com, October 2017

Required Minimum Distributions

Abstract: It is important to be reminded about one frequently overlooked retirement plan requirement. Upon attainment of age 70-1/2, certain participants of a tax-qualified retirement plan may be required by federal tax law to withdraw a minimum amount from such plan each year. These mandatory distributions are known as "required minimum distributions."

Source: Legacyrsllc.com, October 2017

Operational Compliance List

Abstract: Qualified retirement plans must satisfy Section 401(a) of the Internal Revenue Code (and related Code Sections) in both form and operation. In some situations, plans are required to begin operational compliance with changes in the law even before the plan document is required to be updated. This short article answers the question, what is the Operational Compliance List?

Source: Boutwellfay.com, October 2017

The Timely Use of Plan Forfeitures

Abstract: DC plans often provide employer contributions to participants, whether matching or nonelective, that are subject to a vesting schedule. When a participant terminates employment prior to becoming fully vested in those contributions, the unvested portion is forfeited on a date specified by the plan. While this process is generally straightforward, a plan may encounter challenges in determining how and when to use those forfeited assets appropriately.

Source: Fidelity.com, October 2017

Hurricane Summary Relief Charts

Abstract: These charts reflect the hurricane relief that is in effect as of September 29, 2017.

Source: Ferenczylaw.com, October 2017

Improving Audit Quality Through Enhanced Financial Reporting

Abstract: In response to the DOL's findings regarding ERISA plan audit deficiency rate, the AICPA has embarked on an initiative to improve audit quality through auditor badge certification programs, enhanced peer review checklists, and changes to auditing standards by strengthening the audit report.

Source: Belfint.com, September 2017

SEC Chairman Hopes to "Properly Tailor" Approach to Fiduciary Issues

Abstract: Securities and Exchange Commission (SEC) Chairman Jay Clayton hopes that his agency can "properly tailor" an approach that will best address issues related to those the DOL's fiduciary rule concerns. Clayton made his remark during his Sept. 26 testimony before the Senate Committee on Banking, Housing and Urban Affairs.

Source: Asppa.org, September 2017

Hurricane Irma Affects Retirement Plan Administration

Abstract: The arrival of Hurricane Irma in September significantly affected individuals and businesses in Florida, Puerto Rico, and the U.S. Virgin Islands. Recognizing this impact, the IRS, DOL, and the PBGC have granted extensions of certain deadlines for both plan sponsors and participants directly affected by this disaster. The IRS has also provided special rules for plan sponsors that want to offer hardship distributions or plan loans to employees or former employees that have been affected by Hurricane Irma.

Source: Prudential.com, September 2017

IRS' Pre-Approved Plan Program Gets a Make-Over (With Extensions)

Abstract: The IRS recently issued Rev. Proc. 2017-41, which streamlines and enhances the pre-approved plan program in light of the drastic changes that were made to the determination letter program for individually designed plans. Many of these changes were in response to the benefits community comments on ways to help improve the program and facilitate transition of plan sponsors to these pre-approved programs.

Source: Groom.com, September 2017

Preapproved Retirement Plan Program Modestly Modified to Accommodate More Designs

Abstract: The modifications are designed to further the IRS's stated intention to encourage sponsors of individually designed plans to transition to a preapproved plan format. However, the changes are relatively modest and most large plan sponsors will likely find other ways to mitigate their higher compliance risk.

Source: Towerswatson.com, September 2017

Like Harvey, Retirement Plans Can Make Loans, Hardship Distributions to Victims of Hurricane Irma

Abstract: The Internal Revenue Service announced that 401ks and similar employer-sponsored retirement plans can make loans and hardship distributions to victims of Hurricane Irma and members of their families. This is similar to relief provided last month to victims of Hurricane Harvey.

Source: Irs.gov, September 2017

Hurricane Harvey Affects Retirement Plan Administration

Abstract: The arrival of Hurricane Harvey in August significantly affected individuals and businesses in Texas. Recognizing this impact, the IRS, DOL, and the PBGC have granted extensions of certain deadlines for both plan sponsors and participants directly affected by this disaster. The IRS has also provided special rules for plan sponsors that want to offer hardship distributions or plan loans to employees or former employees that have been affected by Hurricane Harvey.

Source: Prudential.com, September 2017

Significant Changes Proposed for Employee Benefit Plan Audit Reports

Abstract: AICPA Auditing Standards Board has proposed changes to the reporting standards for annual audits of employee benefit plans that are covered by ERISA. The proposal, which was issued in April 2017, was in response to a request from the U.S. Department of Labor to re-examine the current audit reporting model for employee benefit plans.

Source: Franczek.com, September 2017

Retirement Plan Relief for Hurricane Harvey

Abstract: The IRS has issued two relief declarations affecting retirement plans. The first, TX-2017-09, provides 7508A relief postponing numerous deadlines to January 31, 2018. The second, Announcement 2017-11, simplifies and streamlines loans and hardship distributions in the wake of Harvey. This document summarizes the IRS relief and the related DOL announcement.

Source: Erisapedia.com, September 2017

DOL Compliance Guidance for Plans Impacted by Hurricane Harvey

Abstract: The guidance provided in this statement applies generally to employee benefit plans, plan sponsors, employers and employees, and service providers to such employers who are located in a county identified for individual assistance by the Federal Emergency Management Agency (FEMA) due to the effects of Hurricane Harvey.

Source: Dol.gov, September 2017

DOL Field Assistance Bulletin No. 2017-02

Abstract: This document announces a temporary enforcement policy related to the DOL's final rule defining who is a fiduciary under ERISA and the Internal Revenue Code, and the related prohibited transaction exemptions, including the Best Interest Contract Exemption, the Class Exemption for Principal Transactions In Certain Assets Between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs, and certain amended prohibited transaction exemptions.

Source: Dol.gov, September 2017

DOL Field Assistance Bulletin No. 2017-03

Abstract: This document announces an enforcement policy related to the limitation of arbitration in the Best Interest Contract Exemption (BIC Exemption) and the Class Exemption for Principal Transactions In Certain Assets Between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs, issued by the dol under ERISA and the Internal Revenue Code.

Source: Dol.gov, September 2017

IRS Revised Its Qualified Plans Correction Program to Address the Determination Letter Program Changes

Abstract: The intent behind most of the changes to the EPCRS program that are highlight in this 4-page article is to conform the correction program with the changes being made to the determination letter program, and to help plan sponsors manage the risks that the loss of the determination letter cycle program has on audit.

Source: Groom.com, August 2017

Regulation of Robo-Advisers by the DOL

Abstract: As the use of robo-advisers to provide investment advice and discretionary management services has become more popular and as related technologies have developed, regulators are beginning to take note. Robo-advisers should consider their legal responsibilities under ERISA and the IRS Code in addition to those under the Advisers Act and other applicable law. This 20-page paper provides an in-depth review.

Source: Groom.com, August 2017

Redesigning the Audit Reporting Model for ERISA Plan Financial Statements

Abstract: The Auditing Standards Board created a special task force in 2015 to consider a proposal to improve the quality of employee benefit plan audits by strengthening the EBP auditors' report. The Chief Accountant of the Department of Labor requested the ASB enhance the ERISA plan audit report to provide better insight regarding the scope of the responsibilities of management and the auditor.

Source: Belfint.com, August 2017

DOL Withdraws Rule Requiring Fee Disclosure Guide

Abstract: The DOL has announced that it is withdrawing a rule requiring that employers provide a guide or similar material along with fee disclosures. The Obama administration had issued a notice of proposed rulemaking about the requirement on March 12, 2014.

Source: Asppa.org, August 2017

Key Rules for Non-Spouse Beneficiaries

Abstract: This is a high level overview of some of the rules that beneficiaries must follow to help preserve the tax-deferred status of inherited retirement account, and avoid penalties.

Source: Retirementdictionary.com, August 2017

Are You Overlooking Required RMD Beginning Dates?

Abstract: Required minimum distributions are a small but important part of retirement plans. Failure to start making them on time can lead to problems for employers and plan participants. If you're a plan administrator, you hold the responsibility of ensuring the first RMD is made in time to fulfill this requirement.

Source: Penchecks.com, August 2017

Many DC Plan Sponsors Must Annually "Notice" Their Participants

Abstract: Sponsors of DC plans with certain features are required to provide annual notices to participants. This chart summarizes the annual notice requirements for each of these notices, including timing, recipients, contents, and methods of delivery. Some plan designs may require multiple notices and some of the notices may be combined or packaged together in one mailing.

Source: Prudential.com, August 2017

IRS Revamps Pre-Approved Qualified Plan Program

Abstract: In new IRS Rev. Proc. 2017-41, the IRS revamps its pre-approved plan program. Many of these changes appear to be designed to make pre-approved plans more attractive and usable in place of individually designed plans. This 4-page article highlights keys aspects of the new guidance.

Source: Groom.com, July 2017

IRS Overhauls Opinion Letter Process for Pre-Approved Plans

Abstract: The overhaul of the pre-approved plan program is not surprising given the IRS's significant reduction of the determination letter program for individually designed plans. The revenue procedure contains detailed information that is a must-read for providers of pre-approved plan documents as well as employers and advisors maintaining pre-approved plans or considering a switch from individually designed to pre-approved plans.

Source: Thomsonreuters.com, July 2017

Top Five Mistakes Made by 401k Plan Sponsors

Abstract: Penalties for administrative blunders can be costly, through fines or, at the severe end of the spectrum, plan disqualification, creating a taxable event for all participants. Here are the most common mistakes plan sponsors make, as well as ways for plan advisers to guide their clients away from those mistakes.

Source: Investmentnews.com (registration may be required), July 2017

2017 Cumulative List for Pre-Approved Plans Issued

Abstract: The Internal Revenue Service has issued Notice 2017-37, which contains the Cumulative List of Changes in Plan Qualification Requirements for Pre-Approved Defined Contribution Plans for 2017.

Source: Planadviser.com, July 2017

Operational Compliance for Eligibility Classification

Abstract: This article focuses on operational compliance, the requirement that the plan be operated in accordance with the terms of the plan document, and in particular, the terms of the plan relating to eligibility classification.

Source: Boutwellfay.com, July 2017

Form 5500 Filing Date Approaching

Abstract: July is here. For DC plans and 403(b) annuity arrangements with calendar year plan years, it means the July 31 Form 5500 filing deadline for the 2016 plan year is not far off.

Source: Alliantwealth.com, July 2017

Who's Responsible for Keeping Retirement Plan Records?

Abstract: Who is ultimately responsible for retention of retirement plan records: the sponsor, or the participant? It's an interesting conundrum. In a recent case, the 9th U.S. Circuit Court of Appeals found that the retirement plan sponsor -- who was the defendant in the case -- was the party responsible for keeping accurate records.

Source: 401ktv.com, July 2017

Fewer DC Plans Offering Hardship Withdrawals and Plan Loans

Abstract: Fewer organizations are offering DC plan hardship withdrawals, plan loans and online retirement investment advice compared with five years ago. However, one-on-one and group/classroom-style investment retirement advice remains unchanged over the same period, according to new survey results from the Society for Human Resource Management.

Source: Napa-net.org, July 2017

IRS Moves to Nudge Employers to Pre-Approved Plans

Abstract: The IRS has made some changes to how it deals with pre-approved plans, hoping to encourage employers to switch from individually designed plans to the pre-approved format.

Source: Asppa.org, July 2017

The Importance of Timely Deposits of Participant Deferrals

Abstract: It is often not clear to many plan sponsors when amounts deferred by employees through payroll become "plan assets." Since it is so important that participant deferrals and loan payments be made promptly, this article highlights the requirements.

Source: Fidelity.com, June 2017

Form 5500 Update

Abstract: As a plan sponsor or financial advisor, it is paramount that you maintain an open line of communication with your TPA or recordkeeper responsible for preparing this filing in order to avoid potential penalties and fines from both the IRS and the DOL. In order to avoid delays in the preparation and filing of the form, here are some things you can do as the plan sponsor to assist your service provider.

Source: Legacyrsllc.com, June 2017

Audits and Other Form 5500 Developments

Abstract: Changes are afoot for ERISA-mandated Form 5500 filing requirements, though it is unclear at this time when and which changes will actually be implemented. IRS has once again allowed a pass on their compliance questions by omitting them from the 2017 draft forms.

Source: Conduent.com, June 2017

Are You Computing Your Maximum Participant Loan Amount Correctly?

Abstract: The IRS issued a Memorandum providing two alternatives for computing the maximum participant loan amount when the participant has prior loans. Prior to this Memorandum, the law was not clear concerning how to compute the maximum loan amount where a participant had taken a previous loan during the year.

Source: Benefitslawadvisor.com, May 2017

What Expenses Can Be Paid From a 401k Plan?

Abstract: From a regulatory standpoint, it is legal for the Plan to pay eligible expenses (such as 401k audit fees, investment advisor charges, TPA fees, etc.) if the Plan has been properly structured and doesn't contain language which would expressly forbid.

Source: 5500audit.com, May 2017

Reimbursement of Sponsor Expenses

Abstract: Some plan sponsors bill their plans for the services the sponsor provides to them. That practice -- while permitted under certain circumstances -- does present certain issues under ERISA. This article briefly reviews the rules under which a sponsor/fiduciary may be reimbursed for expenses, some of the pitfalls those rules present, and some recent litigation on the issue.

Source: Octoberthree.com, May 2017

The Time is Right to Contact Recordkeepers About Hardship Substantiation

Abstract: The IRS recently issued an internal memorandum providing guidance to its employee plans examination group on the substantiation requirements for hardship distributions from a section 401k plan. If your 401k plan recordkeeper has not talked to your company lately about hardship distributions documentation, it may be time to reach out to the recordkeeper.

Source: Erisapracticecenter.com, May 2017

New IRS Guidance Allows Plan Sponsors to Use Forfeitures for Safe Harbor Contributions, QNECs and QMACs

Abstract: Earlier this year, the IRS released proposed regulations which permit employers to use forfeitures to fund safe harbor contributions, QNECs and QMACs.

Source: Mwe.com, May 2017

The Participant Disclosure Regulation: A Guide for Plan Sponsors

Abstract: The DOL's Participant Disclosure Regulation imposes an entirely new disclosure regime on plan administrators, which is intended to provide participants with information to assist them in making informed decisions regarding the management of their plan account. You should consider these requirements on a continual basis, as well as when changes to your plan are contemplated, to ensure you are complying with the Regulation.

Source: Fidelity.com, May 2017

The Problem With Using Forfeitures to Satisfy Employer Contributions

Abstract: When forfeitures occur within a 401k plan, they are then generally available to the sponsor for the purpose of funding additional employer contributions to the participants of such plan or paying certain plan related administrative expenses. This article discusses a newly proposed IRS rule that brings an expansion to the permissible uses of forfeitures to fund employer contributions.

Source: Legacyrsllc.com, May 2017

2017 Expanded Reporting and Disclosure Requirements Calendar

Abstract: The 2017 Expanded Reporting and Disclosure Requirements Calendar provides who, what, when and where reporting and disclosure information for single-employer defined benefit and defined contribution plans subject to ERISA.

Source: Willistowerswatson.com, April 2017

IRS Memorandum on Calculating Maximum Loan Amount

Abstract: The IRS issued an internal memorandum to its auditors on calculating the maximum loan amount where there is or has been a prior loan.

Source: Benefitsforward.com, April 2017

DOL Recovers More Than $41k for St. Paul-Based 401k Plan

Abstract: An investigation by the DOL found from at least Feb. 1. 2010, to May 27, 2015, the company withheld $35,363.86 from employee's pay for voluntary contributions to the 401k Plan. During that same period, the company retained approximately $29,058 of those contributions in the company's corporate bank account and used them for general operating expenses.

Source: Dol.gov, April 2017

Puerto Rico Modifies Retirement Plan Qualification and Trust Requirements

Abstract: Several of the modifications create new disparities between rules under the Puerto Rico and U.S. tax codes. Hacienda is expected to issue clarifying guidance and information on deadlines for plan amendments and determination letter requests. Dual-qualified plans should pay particular attention to the changes that create discrepancies between the U.S. and Puerto Rican tax codes.

Source: Towerswatson.com, April 2017

How to Avoid Costly Beneficiary Designation Litigation

Abstract: A recent federal district court opinion in Florida demonstrates the potential pitfalls that plan administrators may face with respect to disputes over beneficiary status and provides guidance as to how administrators may avoid costly disputes.

Source: Lexology.com, April 2017

Compensation of Self-Employed Participants for Purposes of Qualified Retirement Plans

Abstract: Often, there is confusion regarding what compensation is used to determine contributions to the company's qualified retirement plan on behalf of members of the LLC. This article is a discussion of the basic rules for determining the compensation for self-employed individuals (sole proprietors, partners in a partnership, and members of an LLC taxed as a partnership).

Source: Eisneramper.com, April 2017

EPCRS: Participant Loan Corrections

Abstract: Plan failures related to participant loans can be corrected using either Voluntary Correction Program (VCP) or Correction on Audit. Since plan loan failures are not operational failures, they cannot be corrected using the self-correction method.

Source: Belfint.com, April 2017

Avoid Overpaying User Fees for Your VCP Submission

Abstract: The Employee Plans Voluntary Compliance function has noticed an increase in submissions with incorrect user fees. Many of these submissions include user fees higher than what is required. This announcement reviews some ways to avoid the overpayment of user fees.

Source: Irs.gov, March 2017

IRS Releases Form 5500-EZ and Form 8955-SSA for 2016 Plan Year

Abstract: The IRS has released the 2016 Form 5500-EZ (Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan) and 2016 Form 8955-SSA (Annual Registration Statement Identifying Separated Participants with Deferred Vested Benefits), along with their separate Instructions.

Source: Thomsonreuters.com, March 2017

Retirement Plan Examinations and Enforcement Programs on the Rise: Guidance for Plan Sponsors

Abstract: It's no surprise that DOL and IRS investigations and audits are on the rise. In 2016, the DOL alone closed 2,002 civil and 333 criminal investigations. This article reviews some steps a plan sponsor can take to avoid or mitigate compliance issues before an audit is initiated.

Source: Bsllp.com, March 2017

IRS Views on Self-Certification of Financial Hardship

Abstract: Many plan sponsors rely upon a self-certification process to document and process 401k distributions made on account of financial hardship. The IRS has recently issued examination guidelines for its field agents for their use in determining whether a self-certification process has an adequate documentation procedure.

Source: Benefitsbryancave.com, March 2017

Using the New IRS Remedial Amendment Period Rules

Abstract: This 28-page paper looks at what the Tax Code and Treasury Regulations say about when a retirement plan that is intended to be qualified may be retroactively modified. If one is interested only in whether a plan document meets the qualification requirements, and not what plan terms may be enforced by participants or other parties, this retroactivity question is the whole ballgame.

Source: Utzlattan.com, March 2017

2017 Annual Plan Deadlines for Plan Years Ending December 31, 2017

Abstract: This 7-page chart, although not intended to be exhaustive, includes the key annual events which must occur within a specific deadline for a calendar year plan. The chart is intended to serve as a tool that can be used by employers to monitor compliance over the plan and calendar year.

Source: Voya.com, February 2017

2017 Retirement and Employee Benefits Compliance Calendar

Abstract: This 1-page chart is intended to provide plan sponsors with a list of notable retirement plan deadlines. The deadlines in this chart assume a calendar-year plan year.

Source: Strategicbenefitservices.com, February 2017

Is Your 401k Plan in Compliance?

Abstract: As a 401k plan sponsor are you confident that your plan complies with all current employee benefits laws and regulations? Does the plan operate within the its current provisions? If you're not certain, then it's time for an annual self-checkup.

Source: Dgccpa.com, February 2017

2017 Compliance Checklist for Retirement Plans Subject to ERISA

Abstract: As a retirement plan sponsor, you know how important it is to comply with ERISA and the ever-changing reporting and disclosure requirements mandated by the federal government. This checklist incorporates defined benefit, defined contribution, and ERISA 403(b) requirements and provides information on the materials that you will need to file, filing due dates and agencies to which the filings should be made.

Source: Prudential.com, February 2017

New Determination Letter Procedures for Puerto Rico Retirement Plans

Abstract: Circular Letter 2016-8 from the Puerto Rico Treasury Department (Hacienda) sets out revised procedures for obtaining a determination letter to confirm a retirement plan's qualified status under Puerto Rico law. The deadline for requesting a determination letter for a plan amendment is now based on the amendment's execution date (i.e., its adoption date) rather than its effective date.

Source: Towerswatson.com, February 2017*

Common 401k Plan Administration Data-Quality Errors

Abstract: A list that includes some of the most common tactical 401k data-quality errors found during plan conversions.

Source: Forusall.com, February 2017

Puerto Rico Retirement Plan Qualification Requirements and Trusts Modified

Abstract: The Puerto Rico Governor signed into law Act No. 9-2017. The Act is intended to amend certain provisions that govern the treatment of retirement benefit plans to halt the exodus from Puerto Rico of professionals, protect their economic future, and attract productive human talent to Puerto Rico.

Source: Mcvpr.com, February 2017

Correction of Elective Deferral Failures

Abstract: It is not uncommon for the sponsor of a 401k plan to discover that elective deferral contributions were not deducted from the pay of certain eligible employees as the result of an operational or procedural error. The IRS provides specific guidance for this error.

Source: Voya.com, February 2017

Maintaining Retirement Plan Records

Abstract: Employers who sponsor a retirement plan are required by law to keep books and records available for the IRS to review. Having these records available is also helpful when determining participant benefits. What records should you keep and how long must they be retained is address in this article.

Source: Consultrms.com, February 2017

Accounting Treatment of Refund of Excess Contributions

Abstract: This short article looks at whether retirement plan contributions that end up exceeding legislative limits for the plan year can still be considered contributions on the plan's financial statements.

Source: Belfint.com, February 2017

Puerto Rico 2017 Retirement Plan Limits

Abstract: The Puerto Rico Treasury Department (Hacienda) has announced 2017 benefit limits for retirement plans qualified under Puerto Rico's Internal Revenue Code.

Source: Towerswatson.com, February 2017

Correcting ADP Test Failures

Abstract: New resource from ICI working groups explore how fund intermediaries can fulfill disclosure requirements under the DOL fiduciary rule.

Source: Legacyrsllc.com, February 2017

Record Retention Requirements Applicable to Employee Benefit Plans

Abstract: Presentation details the general rules of ERISA and then discusses several specific recordkeeping requirements for employee benefit plans and a number of general requirements that imply a duty to retain records, for example general fiduciary duties, plan distribution requirements, COBRA requirements and qualified medical child support requirements.

Source: Employeebenefitsblog.com, February 2017

ADP Test Basics

Abstract: The tax code governing 401k plans was written to prevent qualified retirement plans from overly favoring Highly Compensated Employees. A series of non-discrimination tests were devised to measure whether a plan's design or operation lends to favoring the HCEs over the Non-Highly Compensated Employees. This a review of the tests.

Source: Legacyrsllc.com, February 2017

Updated Publication 575 -- Pension and Annuity Income

Summary: This is the newly updated 43-page IRS Publication 575 discusses the tax treatment of distributions from pension and annuity plans and also shows how to report the income on a federal income tax return.

Source: Irs.gov, January 2017

Updated Publication 560 -- Retirement Plans for Small Business

Summary: This is the newly updated 28-page IRS Publication 560 which covers retirement plans can set up and maintain for Small Businesses. Includes SEP, SIMPLE, and Qualified Plans.

Source: Irs.gov, January 2017

Puerto Rico Treasury Issues New Guidance on Rules and Procedures for Qualification of Retirement Plans

Abstract: The Puerto Rico Department of the Treasury issued Tax Policy Circular Letter No. 16-08. CL 16-08 establishes new rules regarding the validity of retirement plan qualification letters and the procedures that employers and service providers must follow to request such qualification letters. It also repeals PR Treasury's Circular Letter 11-10 and Letter 13-02.

Source: Littler.com, January 2017

401k Plans Make Big Fund Changes Following New Money Market Rules

Abstract: Employers have drastically mixed up the "safe" investment options offered in their defined contribution plans in response to new rules that came into effect last year regarding money market funds.

Source: Investmentnews.com (registration may be required), January 2017

Puerto Rico Treasury Department Issues Updated Guidance on Retirement Plans

Abstract: The Puerto Rico Treasury Department recently issued Circular Letter of Tax Policy No. 16-08 (CLTP 16-08) to update and clarify the: (i) rules regarding the effective dates of favorable determination letters issued under Section 1081.01(a) of the Puerto Rico Internal Revenue Code of 2011 (PR Code), and (ii) due dates and procedures for requesting determination letters for retirement plans intended to be qualified under the PR Code.

Source: Groom.com, January 2017

2017 401k ERISA Compliance Calendar

Abstract: This compliance calendar highlights critical compliance deadlines for DC retirement plans. Some deadlines apply only to particular plan types and there may be additional deadlines associated with individual plans that are not covered here. Also, plans with non-calendar plan years may be subject to different deadlines.

Source: Cammackretirement.com, January 2017

2017 Key Administrative Dates and Deadlines for Calendar-Year DC Plans

Abstract: This is a 4-page retirement plan chart and 2017 calendar for defined contribution plans, published Milliman. The document provides key administrative dates and deadlines for calendar-year plans.

Source: Milliman.com, January 2017

Missing Participants: Gone but Not Forgotten

Abstract: In light of the more robust efforts being taken by the IRS and DOL in this area, it is best to craft or update procedures to help demonstrate compliance in locating lost participants and the timely payment of plan benefits. Having such procedures in place helps ensure that plan administrators are properly managing their fiduciary liability risk by taking reasonable and prudent steps to protect participants' and beneficiaries' rights to plan benefits.

Source: Truckerhuss.com, January 2017

DOL Revisits, Relaxes Retirement Plan Proxy Voting Guidance

Abstract: While the DOL's conflict-of-interest guidance is unquestionably the most high-profile fiduciary issue today, it is far from being the only fiduciary consideration to those who sponsor or administer retirement plans. The DOL issued Interpretive Bulletin 2016-1 addresses retirement plan fiduciaries' responsibilities for voting proxies related to retirement plan investments. Notable in this guidance is the DOL's affirmation that plan fiduciaries may consider environmental, social, and governance factors.

Source: Ascensus.com, January 2017

2017 Annual Plan Deadlines

Abstract: There are many important requirements for DC plans that occur either during the calendar year or during the plan year. These requirements include participant statements, compliance testing and remittance of plan contributions. This chart (although not intended to be exhaustive) includes the key annual events which must occur within a specific deadline.

Source: Voya.com, January 2017

DOL Provides Updated Guidance on Proxy Voting by Employee Benefit Plans

Abstract: The DOL released Interpretive Bulletin 2016-01 which provides updated guidance for ERISA plan fiduciaries with respect to the voting of proxies on individual securities held in employee benefit plan portfolios and the appropriateness of active engagement with corporate management by plan fiduciaries.

Source: Haynesboone.com, January 2017

Information Letter on Application of Fiduciary Provisions to Certain Default Investments

Abstract: The DOL has issued an Information Letter on the application of ERISA's fiduciary provisions to default investments with lifetime income features that contain certain liquidity and transferability restrictions.

Source: Benefitsforward.com, January 2017

SEC Gets in on 401k Fiduciary Rule Compliance

Abstract: The Guidance Update will make it easier for mutual funds to create and administer compensation arrangements tailored to comply with the fiduciary rules. It does not address, however, the extent to which brokers may independently set their compensation.

Source: 401kspecialistmag.com, January 2017


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