My apologies to William Camden for dragging him into ERISA. The proverbial saying in the headline, “An ynche in a misse is as good as an ell” appeared in his Remaines concerning Britaine published in 1637. It was an early forerunner of what we now know as “A miss is as good as a mile.” … Continue Reading
Class action law suits and Department of Labor enforcement initiatives have created a 401(k) fee state of mind for fiduciaries. How much, who pays for them, and how they are paid are issues about which service providers offer guidance. @GregIacurci in his article, How Should Retirement Plans Pay Their 401(k) Fees? in Investment News (registration … Continue Reading
The IRS recently announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2016. For the third time in six years, most of the limitations were unchanged because the increase in the Consumer Price Index did not meet the statutory thresholds for their adjustment: 401k Elective Deferrals: … Continue Reading
That’s the question employers ask regarding who pays 401(k) fees. The “us” being, of course, the employer, and the “them” being the plan participants. The number of “thems” has been increasing. According to Deloitte’s 2015 Annual Defined Contribution Benchmarking Survey, the number of employers completely covering the cost of fees declined … Continue Reading
As the sign under the clock pictured above says, tempus fugit, or ‘time flies’ translated from the Latin. This being The Retirement Plan Blog there’s an ERISA connection, of course. Much of ERISA involves meeting deadlines. This one is about establishing a new retirement plan. Before 401(k) plans were invented, an employer with a calendar year … Continue Reading
That’s limitations as in “limitation periods”. A recent court case reminds ERISA plans to have such limitation periods and to communicate it to someone claiming a plan benefit. Let’s start with the basics. What’s a “limitation period”? In layman’s terms, it’s a law set forth in a State statute of limitations that sets time limits … Continue Reading
Employee Benefit Advisor, for whom I serve on the Editorial Advisory Board, recently reported that DC Plan Participation Rates, Account Balance Increase. The reporter, Paula Aven Gladych cited the Deloitte 2015 Defined Contribution Benchmarking Survey that by focusing on “ease of use” retirement plan participation rates have increased from 2013 to 2014. Such features include: … Continue Reading
Let’s say you have a concern about how your 401(k) plan is operating. Maybe participant loans aren’t getting repaid or a service provider has neglected to allocate forfeitures on an annual bases. So you consult a lawyer. The lawyer writes a memo outlining the situation and advising on corrective steps. You drop the memo in … Continue Reading
The sound you may have heard recently was the sigh of relief when the IRS announced Revenue Procedure 2015-32. The Rev. Proc. made permanent a pilot program that ended Tuesday, June 2 that provided administrative relief for delinquent Form 5500-EZ for owner-only plans with over $250,000 in plan assets. Business owners will be able to … Continue Reading
As everyone in the ERISA world knows, the Department of Labor (DOL) on April 20, 2015 published a proposed regulation in the Federal Register relating to the definition of fiduciary within the meaning of ERISA section 3(21)(A)(ii). ERISA section 3(21)(A)(ii) is that part of the definition of fiduciary that addresses investment advice for a fee … Continue Reading
The recent Department of Labor’s re-proposed Fiduciary Rule has generated many opinions on how it will affect fiduciary service models. One constant, however, cuts through all of the debate: the Plan Sponsor still has the fiduciary responsibility to select and monitor those service providers. But as you can see, there is a hierarchy of service … Continue Reading
Superannuation is what Australia calls its retirement system, and they are doing something right. According to the 2014 Melbourne Mercer Global Pension Index (8o-page report if downloaded), an annual study that ranks national retirement systems based on the relative importance of adequacy, sustainability, and integrity, Australia only trails Denmark graded A, and tied with the … Continue Reading
Let’s say, for example, you’re concerned about not having enough money saved for retirement. You’re certainly not alone based on the myriad number of polls, surveys, and studies that have been in the news. So where do you start? You might start at Amazon and search under “Retirement Savings”. At this frozen moment in time … Continue Reading
Every year around this time, the Internal Revenue Service publishes a list of the year’s “Dirty Dozen Tax Scams”. Here they are as an infographic courtesy of The Accounting School Guide. Source: AccountingSchoolGuide.com You can find more detailed information from the testimony of the IRS’ Timothy P. Camus before the Committee on Finance U.S. Senate … Continue Reading
Illinois legislation, the first in the country, recently authorized a new state sponsored retirement savings vehicle called the Secure Choice Savings Program (Secure Choice). The program is aimed at upwards of 2 million Illinois workers who are not currently covered by an employer provided retirement plan. There are at least 16 other states considering legislative … Continue Reading
That’s not my metaphor which is why it’s in quotes. It belongs to Eve Tahmincioglu, the Career Diva, about whom I wrote in 2008. Eve wrote a blog post about the increasing number of 401(k) loans, It’s for retirement stupid…, which very directly expressed her sentiments. Just to reinforce it, her parting words were People, … Continue Reading
I had the opportunity recently to make a presentation on qualified retirement plans to the Illinois CPA Society (ICPAS). Actually, it was using PowerPoint to begin a dialogue with the members of the ICPAS Investment Advisory Services/Personal Financial Planning Forum The ICPAS describes their Forums as being “composed of members with shared interests who interact … Continue Reading
Some of the most difficult and contentious provisions of the Affordable Care Act (“ACA”) are the employer mandate and upcoming reporting requirements effective in 2015. “Difficult” because the employer mandate requires applicable large employers, generally those with 50 or more “full-time” employees, to offer coverage to full-time employees and dependents (other than spouses). If the employer … Continue Reading
As we near the end of the year, many business owners rush to establish retirement plans to capture calendar fiscal year tax deductions. If you’re one of those small business owners, you may also be eligible to receive a tax credit for expenses you incurred to implement your plan. What’s the difference between a tax … Continue Reading
What’s an eligible rollover distribution and what’s not can be a complicated and confusing matter. Here’s a recent and handy rollover chart by the Internal Revenue Service updated for new rules that may be helpful. 1 Qualified plans include, for example, profit-sharing, 401(k), money purchase and defined benefit plans 2 Beginning in 2015, only one … Continue Reading
Harry S. Truman, the 33rd President of the United States, is pictured above with the sign he kept on his desk, “The buck stops here.” It meant that the President had to make the decisions and accept the ultimate responsibility for those decisions. What does that have to do with a 401(k) plan? Everthing. It’s … Continue Reading
On October 23, 2014 the IRS announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2015. The chart below highlights the new limits for 401(k) and other defined contribution plans. The rest of the new limits and the fine print can be downloaded here.… Continue Reading
That’s a picture of the second-story writing studio that adjoins the Key West house in which Ernest Hemingway lived in the 1930s. He wrote many of his best and most famous stories and books there. His house is now a museum, and the cat in the foreground is one of the approximately 59 others who … Continue Reading
