Voluntary Corrections for Qualified Plans October 2009 Newsletter Given the complex nature of administering qualified retirement plans in accordance with ever-changing pension law, mistakes are inevitable. When the IRS discovers plan mistakes through audit, the plan risks being disqualified which results in severe consequences to the plan sponsor and participants. Fortunately, the IRS recognizes that…
DetailsPlan Distributions Are on the Rise August 2009 Newsletter The primary goal of a retirement plan is to accumulate savings to provide income after retirement. Most plans also allow distributions before retirement age for a number of circumstances, including termination of employment and financial hardship. Non-taxable participant loans may also be an option. Not surprisingly,…
DetailsERISA Fiduciary Responsibilities June 2009 Newsletter Are you a fiduciary of your company’s retirement plan? If you’re not sure, it’s time to find out because if you are a fiduciary, it is important to know exactly what your responsibilities are. The Employee Retirement Income Security Act of 1974 (ERISA) imposes rigorous standards on plan fiduciaries,…
DetailsLayoffs Can Result in a Partial Plan Termination Requiring 100% Vesting April 2009 Newsletter With the current economic conditions, many companies have been forced to downsize either by laying off a portion of the workforce or closing a plant or line of business. These layoffs can have an impact on a qualified plan. If enough…
DetailsPayment Options for Plan Expenses February 2009 Newsletter Qualified retirement plans provide tax deductible benefits for employers and employees, as well as an opportunity for significant savings for the post-retirement years. But these plans require adherence to numerous governmental regulations, and there are costs involved in the establishment and ongoing maintenance of the plan. The…
DetailsThe Hidden Pension Trap – The Aggregation Rules December 2008 Newsletter One of the primary objectives of the qualified plan rules is to make the tax advantages contingent upon covering a significant number of the nonhighly compensated employees. As this goal could be thwarted by creating separate legal entities for the highly compensated and nonhighly…
DetailsTimely Deposit of Plan Contributions October 2008 Newsletter The Department of Labor (DOL) has finally provided much anticipated guidance for the timely deposit of elective deferrals in qualified 401(k) plans. The proposed regulation keeps the same basic framework for determining if contributions are timely deposited but adds a safe harbor rule that many plans can…
DetailsEGTRRA Restatements…The time has come August 2008 Newsletter It’s that time again! Time for what, you ask? To participate in that never ending ritual of qualified retirement plan restatements! As legislation affecting retirement plans is enacted, the Internal Revenue Service (IRS) requires all plan sponsors to restate or “rewrite” their plans to conform to current…
DetailsSolving 401(k) Testing Problems With New Design Options June 2008 Newsletter One of the more frustrating aspects for the small business maintaining a 401(k) plan is satisfying the special nondiscrimination requirements. The tests require adequate participation by “non-highly compensated employees” (NHCEs) in order for the “highly compensated employees” (HCEs) to maximize their own salary deferrals.…
DetailsTop Heavy Rules May Impact Plan Design April 2008 Newsletter Retirement plans have been subject to “top heavy” rules for about 25 years. By now you’d think that their application would be fairly straightforward. But lately these provisions have affected some plans in unexpected ways, surprising plan sponsors who thought top heavy was a non-issue…
Details