Today's Update

IRS Guidance

Covered Compensation Tables for the 2017 Plan Year

Rev. Rul. 2017-05 sets forth Covered Compensation tables for the 2017 plan year. Document Excerpt This revenue ruling provides tables of covered compensation under § 401(l)(5)(E) of the Internal Revenue Code and the Income Tax Regulations thereunder, for the 2017 plan year. Link https://www.irs.gov/pub/irs-drop/rr-17-05.pdf

Letter Authorizing Suspension of Iron Workers Pension

The IRS has issued its letter authorizing the suspension of the Iron Workers Local 17 Pension plan benefits. Document Excerpt As required by MPRA, Treasury conducted a vote of eligible Plan participants and beneficiaries to approve or reject your benefit suspension. This vote concluded at 5:00 p.m. EST on Friday, January 20, 2017. Pursuant to […]

Guidance on Claiming Hardship Exemption

Notice 2017-14 provides circumstances under which the hardship exemption from the individual shared responsibility payment may be claimed on a federal income tax return without obtaining a hardship exemption. Document Excerpt This notice supplements Notice 2014-76, 2014-50 I.R.B. 946, by identifying an additional hardship exemption from the individual shared responsibility payment under § 5000A of […]

Proposed Changes to the Definitions of QMACs and QNECs

Proposed changes to the definitions of qualified matching contributions and qualified nonelective contributions that would remove the requirement that the contributions be nonforfeitable when made. Document Excerpt Under these regulations, employer contributions to a plan would be able to qualify as QMACs or QNECs if they satisfy applicable nonforfeitability and distribution requirements at the time […]

Last Day of the Remedial Amendment Period for 403(b) Plans

Revenue Procedure 2017-18 provides that the last day of the remedial amendment period for Section 403(b) arrangements for purposes of Section 21 of Revenue Procedure 2013-22 is March 31, 2020. Document Excerpt This revenue procedure provides that the last day of the remedial amendment period for § 403(b) plans, for purposes of section 21 of […]

Corporate Bond Monthly Yield Curve

Notice 2017-13 provides guidance on the corporate bond monthly yield curve and the corresponding spot segment rates under Section 417(e)(3). Document Excerpt This notice provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under § 417(e)(3), and the 24-month average segment rates under § 430(h)(2) of the Internal Revenue […]

DOL Guidance

DOL Files Notice to Delay Fiduciary Rule

In response to the President’s Executive Order, the DOL has filed a notice with OMB to delay the applicability date of the conflict of interest regulations. Document Excerpt Link https://www.reginfo.gov/public/do/eoDetails?rrid=127213

Resolutions of Disapproval of State Based Private Plans

A Resolution of Disapproval has been introduced in Congress regarding the regulations and Interpretive Bulletin allowing states to adopt and maintain private sector retirement plans. Document Excerpt Rep. Tim Walberg (R-MI), chairman of the Subcommittee on Health, Employment, Labor, and Pensions, and Rep. Francis Rooney (R-FL) have introduced two resolutions of disapproval (H. J. Res […]

Texas Court Upholds Fiduciary Rule

A federal district court in Texas denies the plaintiffs’ motion for summary judgment and grants the DOL’s motion. Document Excerpt Before the Court are the parties’ Cross-Motions for Summary Judgment (ECF Nos. 48, 51, 54, 67). On November 17, 2016, the Court held oral argument on the Motions. For the reasons stated below, Plaintiffs’ Motions […]

DOL Statement Following Executive Order

The DOL issued a statement that it would review its legal options to delay the applicability date of the regulations in order to comply with the White House’s Order. Document Excerpt Link https://www.dol.gov/newsroom/releases/opa/opa20170203

Executive Order on Fiduciary Rule

The Executive Order requires the DOL to review the fiduciary rule and possibly rescind. Document Excerpt If you make an affirmative determination as to any of the considerations identified in subsection (a) or if you conclude for any other reason after appropriate review that the Fiduciary Duty Rule is inconsistent with the priority identified earlier […]

Proposed Best Interest Contract Exemption For Insurance Intermediaries

The DOL releases a proposed Best Interest Contract Exemption that would allow certain insurance intermediaries and the insurance agents and companies they contract with, to receive compensation in connection with fixed annuity transactions that might otherwise give rise to prohibited transactions. Document Excerpt The class exemption proposed in this document would provide relief that is […]

PBGC Guidance

PBGC Penalties Updated

The PBGC announces updates to its civil penalties. Document Excerpt The Pension Benefit Guaranty Corporation is required to amend its regulations annually to adjust the penalties provided for in sections 4071 and 4302 of the Employee Retirement Income Security Act of 1974. This action is being taken in accordance with the Federal Civil Penalties Inflation […]

ABA Committee Q & A Session with PBGC

The American Bar Association Joint Committee on Employee Benefits releases its annual Q & A session with the PBGC. Document Excerpt The following questions and answers are based on informal discussions between private-sector representatives of the JCEB and PBGC staff members. The questions were submitted by ABA members in advance to the agency and the […]

Allocation of Assets; Interest Assumptions for Valuing Benefits

The PBGC releases updated guidance on the applicable interest rate to be used to value benefits in a single employer plan under Section 4044 for the first quarter of 2017. Document Excerpt This final rule amends the Pension Benefit Guaranty Corporation’s regulation on Allocation of Assets in Single-Employer Plans to prescribe interest assumptions under the […]

PBGC Guarantee Limit

The PBGC has announced higher guaranteed benefit limits for 2017. Document Excerpt WASHINGTON – The Pension Benefit Guaranty Corporation announced today that the guarantee limit for single-employer plans that fail in 2017 will be higher than the limit that applied for 2015 and 2016. Link http://www.pbgc.gov/news/press/releases/pr16-16.html

PBGC Announces 2017 Premium Rates

The PBGC has announced premium rates for 2017. Document Excerpt The per-participant flat premium rate for plan years beginning in 2017 is $69 for single-employer plans (up from a 2016 rate of $64) and $28 for multiemployer plans (up from a 2016 rate of $27). For plan years beginning in 2017, the variable-rate premium (VRP) […]

Disaster Relief for Parts of North Carolina

The PBGC has announced disaster relief for those affected by Hurricane Mathew in North Carolina. Document Excerpt The disaster area consists of Beaufort, Bladen, Columbus, Cumberland, Edgecombe, Hoke, Lenoir, Nash, Pitt, and Robeson Counties. Link http://www.pbgc.gov/prac/other-guidance/dr/dr16-12.html

Articles, White Papers & Other Information

Court Allows C Corp. DISC Payments to Roth IRA

The 6th Circuit overturned the decision of the Tax Court and allowed an arrangement that resulted in payments of millions of dollars to a Roth IRA though, as the court acknowledged, such arrangement effectively allowed for payments in excess of IRA contribution limits. Document Excerpt As it turns out, the Commissioner does not have such […]

Resolutions of Disapproval of State Based Private Plans

A Resolution of Disapproval has been introduced in Congress regarding the regulations and Interpretive Bulletin allowing states to adopt and maintain private sector retirement plans. Document Excerpt Rep. Tim Walberg (R-MI), chairman of the Subcommittee on Health, Employment, Labor, and Pensions, and Rep. Francis Rooney (R-FL) have introduced two resolutions of disapproval (H. J. Res […]

Texas Court Upholds Fiduciary Rule

A federal district court in Texas denies the plaintiffs’ motion for summary judgment and grants the DOL’s motion. Document Excerpt Before the Court are the parties’ Cross-Motions for Summary Judgment (ECF Nos. 48, 51, 54, 67). On November 17, 2016, the Court held oral argument on the Motions. For the reasons stated below, Plaintiffs’ Motions […]

SEC Registration Requirements for Certain 401(k) Plans with Brokerage Windows

The SEC in a Q & A (126.41) indicates that certain 401(k) plans that allow participants to invest in company stock through the plan’s brokerage window may be required to register. Document Excerpt Question 126.41 Q: A company sponsors a 401(k) plan that does not offer an employer securities fund in which employee contributions may […]

Seventh Circuit Rejects Dudenhoeffer Special Pleading for Privately Held Stock

The court interpreted the Supreme Court’s special pleading standard as applying to publicly-traded stock only. Document Excerpt GreatBanc’s (and the district court’s) reliance on Dudenhoeffer is unwarranted. In Dudenhoeffer, the Supreme Court held that ERISA fiduciaries conducting ESOP transactions can generally prudently rely on the market value of publicly traded stock, absent special circumstances. Dudenhoeffer, […]

Discussion Draft on Multiemployer Plan Proposed Changes

Representative Kline releases a discussion draft on changes to modernize multiemployer plans. Document Excerpt WASHINGTON, D.C. | September 9, 2016 – Rep. John Kline (R-MN), chairman of the House Committee on Education and the Workforce, today unveiled a discussion draft of a proposal to modernize the nation’s multiemployer pension system. Part of the committee’s ongoing […]

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