Due to the new regulations under 408(b)(2), plan sponsors/fiduciaries are required to have updated contracts with their service providers that are in line with the new regulations by July 1, 2012 for any services where fees of $1,000 or greater are charged. 

If the signed contracts are not in place than the fees paid to these service providers will be considered prohibited transactions under the plan and are required to be disclosed in the supplemental schedules of the plan’s audited financial...

Most medical practices are aware of the HIPAA and HITECH requirements that affect their organizations, and the fines that they face if they are not compliant in the ways they handle patient health information (PHI).

What a lot of professionals don’t know is that a recent addition to the HIPAA and HITECH regulations holds business associates, (i.e. other professionals from other companies who have access to patient health information) just as responsible for sensitive patient data privacy and...

The Internal Revenue Service (IRS) has been increasing its audit activity in the qualified plan area.  The IRS recently indicated that it had audited approximately 10,000 qualified plans in 2011 (an 18% increase from 2007, the last year for which data is available), as well as conducting 4,500 “compliance checks,” new program which includes a lower level of review than an audit.  Additionally, the IRS has created a new program (Employee Plans Team Audit) which targets plans that have in excess...

This month's Not-for-Profit Update includes:

• Predicting the Impact of Changing Tax Treatment of Charitable Contributions
• Payroll Audit Updates                
• The Age of Nonprofit Mergers is Upon Us
• The Case of Exempt Organizations in the Tax Reform Debate
• New District of Columbia Nonprofit Corporation Act
• Executive Compensation: Did We Do All The Right Things?
• The IRS Issues Guidance on Tax Treatment of Cell Phones and Provides Recordkeeping Belief 
• More Changes and Debate Over the FASB's Proposed...

This month's Special Delivery e-newsletter includes:

• Payroll Tax Cut Extension
• IRS Reverses 1099-K Reporting Rule
• New Strategic Marketing Website and E-Book Available
• Take Tax Credit When They Are Due
• Locking in Deductions for Mortgage Interest
• How to Reduce Employee Turnover
• Ohio Construction Reform is here
• IRS Issues Guidance on Work Credit for Hiring Veterans
• Join the 123 College Facebook

Payroll Tax Cut Extension
 
Although not signed into legislation just yet, the Senate and the House have both...

In the past week I’ve received three articles from colleagues related to benefit plan sponsors receiving fines.  The majority of these articles seem focused on fiduciaries not taking responsibility over plan operations or the lack of documentation of fiduciaries’ consideration when making decisions that affect the plan.  So, I thought I’d take a moment to summarize some of the requirements shown on the Department of Labor (DOL) website in relation to fiduciary responsibility.  Please remember,...

Captive insurance companies are often owned by a large sophisticated financial entity, because there are minimum net worth and other regulatory requirements.  In many cases, the regulatory authority will accept a letter of credit in lieu of an actual cash investment for the initial capital requirements of the captive.  This results in “GAAP exception” financial reporting but is perfectly acceptable to the regulator.

Normally, single sponsor captives are wholly-owned subsidiaries and are included...

If you have been working a long time, you may be looking forward to retirement in the not-so-distant future. Hopefully, you will be in good health at that time and able to pursue your favorite activities.

But the “golden years” may be tarnished if you are not careful. Here are five common mistakes that can hinder your ability to retire comfortably and securely.

1. You are overburdened with debt. Owing money is not necessarily fatal to a happy retirement. But credit card debt with high interest...

Increased transparency is the trend in the world of financial reporting, and this trend is clearly reflected in the new Accounting Standards Update (ASU) for companies that participate in multiemployer defined benefit pension plans. The Financial Accounting Standards Board (FASB) recently completed redeliberations on the standard that becomes effective for public companies later this year. The FASB’s September 2010 Exposure Draft on multiemployer defined benefit pension plans generated...

What a year it has been. In 2011 we have witnessed devastation caused by a wide variety of natural disasters, ranging from tornadoes to floods to wildfires. Although it is a small consolation if your home or other property is damaged as a result, at least you may be able to deduct a casualty loss on your tax return.

Basic rules: You may qualify for a casualty loss deduction if damage is caused by an event that is “sudden, unexpected or unusual.” This not only includes natural disasters already...

Have you put together your 2012 marketing plan? There is still time.

The Coming Year

Moody’s, Goldman Sachs, the Economist and other sources point to 2012 as another year of stagnate growth for the U.S. economy. Most of these sources point to less than 2% growth in GDP. As you know, anything can happen but it appears to be another tough year to grow your business. You need to plan for more of the same and hope for better. 

Part of this planning should include developing your marketing programs and...

The issue of whether a worker should be treated as an employee or an independent contractor has been an area of significant IRS interest for decades. The IRS has the ability to assess significant employer penalties for failure to withhold employment and income taxes on a worker who should have been treated as an employee.

If an employer is faced with this issue upon an IRS examination, the IRS will typically offer to settle the penalties at a discounted rate under Internal Revenue Code (IRC)...

• Investment Reporting and Disclosure
• 403(b) Plans - How Many Are There?
• DOL and Internal Revenue Service (IRS) Annual Filings
• Required Fee Disclosures to Plan Sponsors - 408(b)(2) Interim Final Regulations
• Defined Benefit Plan Amendment Deadline Extended by the IRS
• EBSA Enforcement Actions to Protect Employee Contributions
• Do you have a "Mr. Forfeiture" in your Plan?

Recent EBP Developments

Change and transparency are...

Although employers who maintain tax-qualified retirement plans are well aware of the requirement to file an annual information return (Internal Revenue Service (IRS) Form 5500), many employers appear unaware of their responsibility to file a similar return for other employee benefit programs.  If the IRS discovers that required filings have not been made, penalties are severe.  This article will discuss what types of plans need to file, potential penalties and a program that can minimize the...

This month's Special Delivery E-Newsletter includes the following articles:

• Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010
• Year-End Tax Planning Letter for Individuals
• Year-End Tax Planning Letter for Businesses
• What Are the Benefits of Buy-sell Agreements?
• Don't Miss Out on Above-the-line Deductions
• Keeping Records for Your Business Car
• Aurum Capital Markets Summary
• R&D Tax Credit Extended for 2010 and 2011 Calendar-year Expenses
• IRS Increases Business Mileage Rate to...

One Last Chance to Repair Deferred Compensation Plan Issues

December 31, 2010 marks the closing of a window offered by the IRS to self-correct non-qualified deferred compensation programs (NQDC) for failure to comply with Internal Revenue Code Section 409A (409A).  Although many employers have reviewed their programs for 409A compliance, some have not and should do so.  Let's briefly look at the issue and what should be done before year end.

Click here to read more about section 409A and the...

December 31, 2010 marks the closing of a window offered by the IRS to self-correct non-qualified deferred compensation programs (NQDC) for failure to comply with Internal Revenue Code Section 409A (409A).  Although many employers have reviewed their programs for 409A compliance, some have not and should do so.  Let’s briefly look at the issue and what should be done before year end.

NQDC include (but are not nearly limited to) traditional deferral arrangements (such as supplemental retirement...

If your organization utilizes a 403(b) benefit plan, you most likely know of the recent changes to the Form 5500 reporting and audit requirements.
  

After reviewing these changes, many plan administrators had expressed concern that the historical treatment of 403(b) plans as a collection of individual contracts with respect to which employees could engage in a series of actions without the involvement or consent of a plan administrator or employer could make it costly, and in some cases...