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Trends in retirement plans

Agencies release guidance on SECURE Act changes

On September 2, 2020, IRS released Notice 2020-68, providing Q&A guidance on (among other things) issues for qualified retirement plans under the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act). On August 20, 2020, DOL released a proposed rule establishing requirements for (required) registration of “pooled employer plans” (PEPs, also known as open multiple employer plans or Open MEPs) under the SECURE Act, providing a new Form PR for that purpose.

Current legislative outlook – beyond SECURE – the next round of (possible) bipartisan retirement legislation

The Setting Every Community Up for Retirement Enhancement (SECURE) Act – which includes (among other things) a defined contribution plan annuity fiduciary safe harbor, closed group relief, authorization of DC Open multiple employer plans (MEPs), mandatory lifetime income disclosure, and mandatory coverage of long-term part-time employees – remains stalled in the Senate. There is broad…Read More

Legislative Update – February 2019

In this article we briefly consider several recent retirement policy legislative initiatives in the 116th Congress: the Retirement Enhancement and Savings Act of 2019 (RESA), re-introduced in the House by Congressman Kind (D-WI) on February 6, 2016; the Rehabilitation for Mutiemployer Pensions Act introduced in the House by Ways and Means Chairman Neal (D-MA) on…Read More

Legislative update — October 2018

Possible retirement savings legislation in lame duck session On September 27, 2018, the House passed the Family Savings Act (FSA) (part of House Republicans’ Tax Reform 2.0 proposal), after making two significant retirement policy related changes to the bill approved by the Ways and Means Committee. There are several other significant retirement savings policy initiatives in…Read More

Executive Order on Strengthening Retirement Security in America

On August 31, 2018, President Trump signed an Executive Order on Strengthening Retirement Security in America. Summarizing, the order does three things: Agencies to consider authorization of Open MEPs: It instructs the Secretary of Labor to “examine policies” that would eliminate ERISA regulatory obstacles to the creation of Open MEPs; and it instructs the Secretary…Read More

IRS Private Letter Ruling OKs 401(k)/student loan repayment program

On August 18, 2018, the Internal Revenue Service released Private Letter Ruling (PLR) 201833012, concluding that a 401(k) plan that provided for “an employer non-elective contribution on behalf of an employee conditioned on that employee making student loan re-payments” did not violate Internal Revenue Code section 401(k) prohibitions on conditioning a benefit on an employee…Read More

Bipartisan savings legislation introduced in Senate

A bipartisan group of Senators – Booker (D-NJ), Cotton (R-AK), Heitkamp (D-ND) and Young (R-IN) – have introduced four bills designed to increase employee savings. In this article we focus on two of these proposals that are designed to incentivize short-term savings, the “Strengthening Financial Security Through Short-Term Savings Accounts Act of 2018” and the…Read More

IRS Finalizes partial annuity regulation

On September 9, 2016 IRS published final regulations providing rules for “partial annuity distributions” in defined benefit plans, e.g., distribution of part of a participant’s benefit as a lump sum and part as an annuity. In this article we discuss the final regulation. Background Under current rules, the present value of any optional form of…Read More

Cash Balance Plan Administration in the 21st Century

It’s Beginning to Look a Lot Like a Defined Contribution Plan As many companies are coming to appreciate the value of the Market Return cash balance plan design, managing economic risk and contribution volatility has become much more realistic. Today’s cash balance plans now work in harmony with 401(k)/Profit Sharing Plans to deliver significant risk…Read More