Understanding who is a plan fiduciary
may be more complex than expected. The Random House dictionary
defines a fiduciary as “a person to whom property or power is
entrusted for the benefit of another.” It is important to
understand a fiduciary is determined either by being specifically
named or appointed or unintentionally by the functions one
performs.
A named fiduciary is someone specifically named in the
plan document or appointed by the plan sponsor as being responsible
for operating the...
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This quarterly
Employee Benefit Plan Commentator includes the following
articles:
Recent EBP Developments
Change and transparency are...
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In May 2010, the Service sent out letters and instructions to a
random sample of 1,200 employers that sponsor 401(k) plans, asking
them to complete a “401(k) Compliance Check Questionnaire.”
The Service said that the information gathered would provide a
comprehensive view of 401(k) plans, and would help the Service
maximize its resources for education, outreach, guidance, and
enforcement efforts while minimizing the burden to compliant plan
sponsors. Recipients of the questionnaires were given...
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Details
The Internal Revenue Service has announced that its Employee Plans
Compliance Unit (“EPCU”) will be mailing out a letter and
instructions to a random sample of 1,200 employers that sponsor
401(k) plans asking them to complete a “401(k) Compliance Check
Questionnaire.”
Background
The Service is well aware that 401(k) plans have far surpassed
defined benefit plans as the preferred retirement vehicle for the
majority of employers. A recent IRS Employee Plans Examination
Study of 79 market...
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Beginning with the 2009 Form 5500 filings (due in
2010), employee benefit plans that are qualified under section
403(b) of the Internal Revenue Code that are sponsored by
charitable organizations and covered under the Employee Retirement
Income Security Act of 1974 (ERISA) will be subject to the same
reporting and audit requirements that currently exist for section
401(k) plans.
What
does this mean for affected organizations? It most likely means
that they face significant challenges with:
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The
Internal Revenue Service recently issued substantial guidance
designed to boost retirement savings, including:
- Changes to automatic retirement plan
contributions;
- Contributions of unused paid time off to be
contributed to a retirement plan; and
- A
detailed explanation of tax-free rollover options.
The
guidance is found in several rulings identified below. You can
access the rulings by following
this link.
Summary
of Changes
1.
Automatic Contribution Increases under Automatic...
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Suspension of
Required Minimum Distribution Requirement
One of the many
provisions in the Worker, Retiree, and Employer Recovery Act, which
was signed into effect in December 2008 by then President Bush,
provided for a one-year suspension of the required minimum
distribution ("RMD") payments for certain retirement plan
accounts.
Under current law, the RMD rules provide that participants in
"qualified plans" and individual retirement arrangements ("IRAs")
are generally required to begin taking...
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In a
continuation of our benefit plan audit series, over the next few
weeks, we’ll continue updating you on changing rules and
regulations and their impact on employee benefit plan
audits.
This
week’s topic:
403(b)
Plans
In November 2007, the
DOL issued amendments to the Form 5500 - Annual Return/Report of
Employee Benef it Plan - for the 2009 plan year. One of the changes
eliminated the exemption granted to Internal Revenue Code ("IRC")
§403(b) retirement plans of IRC §501(c)(3) organizations,...
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