Articles

An Analysis of the SECURE Act

On December 20, 2019, the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 was enacted. The SECURE Act is the most sweeping retirement legislation since the Pension Protection Act of 2006, and many of its provisions are designed to make retirement plans more accessible to employees and less cumbersome for employers.
 

Aligning a Plan Sponsor’s Business Objectives and Plan Design

Assessing plan design is not only important when establishing a plan, but as part of ongoing annual reviews. Taking time to evaluate the plan sponsor’s goals each year can help pinpoint plan features that are no longer aligned with your clients current needs.

Pension Plan Sponsors Continue to Search for Ways to Reduce Liabilities

In an environment where defined benefit pension plans are seeing rising costs from declining interest rates, rising participant longevity/mortality, and rising Pension Benefit Guaranty Corporation premiums, most pension plan sponsors are looking for ways to manage, or eliminate, their defined benefit liabilities and their annual pension expense. 

Get Ready for Year-End Testing

Every 401(k) plan is subject to certain year-end testing requirements (even plans that have adopted a safe harbor design feature). As the sponsor of your company’s 401(k) plan, you must ensure that plan contributions have not exceeded the annual limits set by federal tax law and are not discriminatory against lower paid workers.

Treasury Issues Final Regulations on Reportable Policy Sale Provisions

Last month, the Internal Revenue Service (IRS) issued Final Regulations, which established rules around the Reportable Policy Sale provisions included in the Tax Cuts and Jobs Act of 2017 (TCJA).

IRS Plan Limits

Each year, the Internal Revenue Service publishes updated dollar limitations for tax-qualified defined benefit and defined contribution plans. The limits are important for tax-qualified plans, as well as many non-qualified plans.

Determining Whether or Not You Need a Plan Committee

Managing a company retirement plan by committee is not required by the IRS or the Department of Labor. But many plan sponsors find that setting up a plan committee is the best way to manage their fiduciary responsibilities and maintain compliance with the rules governing retirement plans. 

May a Plan Pay the Sponsor Costs for Helping to Run an ERISA Plan?

As plan sponsors are aware, operating any employee benefit plan costs money. Depending on the nature of these costs, they may be paid from plan assets. Where a plan is subject to Employee Retirement Income Security Act of 1974 (ERISA), in addition to general considerations of prudence any such reimbursements are subject to ERISA’s prohibited transaction rules.

Monitoring Managed Accounts: A Fiduciary Duty
 

In our previous newsletters, we discussed the growing demand for managed account services and previewed the product that Newport Group will soon be launching.  As a quick review, a managed account service identifies an investor's risk profile, assigns a portfolio that is suitable to the investor and monitors the portfolio over time, adjusting risk as needed.

Considerations for Separate Account BOLI Owners

Banks have been using separate account BOLI as informal offset to employee benefits costs since the late 1990s. During the early 2000s, the separate account structure became the product of choice for many mid- and large-sized banks. The structure requires an allocation of premiums to one or more investment sub-accounts offered by the insurance carrier.

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