Today's Update

IRS Guidance

New Determination Letter Application Requirements for Defined Benefit Plans with De-Risking

The IRS has announced new requirements for defined benefit plans applying for a determination letter with pension de-risking language. Document Excerpt Applicants requesting determination letters for their defined benefit (DB) plans should identify whether the plan has lump sum risk transfer language in either the cover letter to their application or an attachment. For plans […]

Changes to the Determination Letter Program

Revenue Procedure 2016-37 sets forth modifications and changes to the IRS’ determination letter program. Document Excerpt This revenue procedure modifies the Internal Revenue Service (IRS) determination letter program for qualified plans to eliminate, as of January 1, 2017, the five-year remedial amendment cycle system for individually designed plans, currently set forth in Rev. Proc. 2007-44, […]

Proposed Regulations Issued Under Section 457

The document contains proposed regulations prescribing rules under section 457 of the Internal Revenue Code for the taxation of compensation deferred under plans established and maintained by State or local governments or other tax exempt organizations. These proposed regulations include rules for determining when amounts deferred under these plans are includible in income, the amounts […]

New Proposed Section 409A Regulations

The IRS has issued new proposed regulations under Section 409A regarding nonqualified deferred compensation arrangements. These regulations can be relied upon. Document Excerpt This document contains proposed regulations that would clarify or modify certain specific provisions of the final regulations under section 409A (TD 9321, 72 FR 19234). This document also withdraws a specific provision […]

Notice 2016-39 does not apply to Non-Qualified Contract

In conjunction with the issuance of Notice 2016-39, the IRS also released Revenue Procedure 2016-36 providing that Notice 2016-39 does not apply to payments received from a retirement plan by an employee during phased retirement from a non-qualified contract. Document Excerpt This revenue procedure provides guidance regarding the application of §§ 1.72-2(b)(2) and 1.72-4(b)(1) of […]

Guidance on Taxation of Payments received during Phased Retirement

Notice 2016-39 provides guidance on how retirement benefits received during a phased retirement are to be taxed and the application of Section 72. Document Excerpt This notice provides guidance in response to inquiries as to whether payments received by an employee from a qualified defined benefit plan1 during phased retirement are amounts received as an […]

DOL Guidance

Request for Comments on Options for Provision of Contraceptives

The DOL, HHS and IRS are requesting ideas for alternatives for providing contraceptives under plans maintained by employers with religious concerns. Document Excerpt This document is a request for information on whether there are alternative ways (other than those offered in current regulations) for eligible organizations that object to providing coverage for contraceptive services on […]

Proposed Changes to DOL Reporting Regulations

The changes are proposed in order to conform to the proposed changes to the Form 5500. Document Excerpt SUMMARY: This document contains proposed amendments to Department of Labor (DOL) regulations relating to annual reporting requirements under Part 1 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended […]

Proposed Revisions to Form 5500

The DOL has issued proposed revisions to the Form 5500. Document Excerpt SUMMARY: This document contains proposed changes to the Form 5500 Annual Return/Report forms, including the Form 5500, Annual Return/Report of Employee Benefit Plan (Form 5500 Annual Return/Report), and the Form 5500–SF, Short Form Annual Return/Report of Small Employee Benefit Plan (Form 5500-SF). The […]

Final Rule on DOL Civil Penalties

The DOL has issued a final regulation on the adjustment of various statutory penalties including under ERISA. Document Excerpt In accordance with the requirements of the Federal Civil Penalties Inflation Adjustment Act of 1990, Pub. L. 104-410, 104 Stat. 890, as amended by the section 31001(s) of the Debt Collection Improvement Act of 1996, Pub. […]

FAQs on Affordable Care Act Implementation Part 32

The agencies released Frequently Asked Questions regarding the implementation of the Affordable Care Act Part 32. These questions and answers address issues regarding the interplay between COBRA and the options on the Marketplace. Document Excerpt Set out below is an additional Frequently Asked Question (FAQ) regarding implementation of the Affordable Care Act and the Consolidated […]

Proposed Regulations on Expatriate Health Plans, Issuers, Excepted Benefits

The DOL, IRS and HHS have issued proposed regulations on expatriate health plans, expatriate health plan issuers and qualified expatriates, along with excepted benefits, lifetime annual limits and short-term limited duration insurance. Document Excerpt This document contains proposed regulations on the rules for expatriate health plans, expatriate health plan issuers, and qualified expatriates under the […]

PBGC Guidance

PBGC Charts Risk of Insolvency in Upcoming Years for Multiemployer Program Component

The PBGC, in its report to Congress, projects the likelihood of insolvency of its multiemployer plan insurance program over a 20 year period absent a significant premium increase. Document Excerpt Based on these projections, and assuming no changes either in multiemployer plans or in PBGC’s multiemployer program, there is more than a 40 percent likelihood […]

Final 4010 Regulations

The PBGC releases its final Section 4010 annual reporting regulation. Document Excerpt The Pension Benefit Guaranty Corporation (“PBGC”) is amending its regulation on Annual Financial and Actuarial Information Reporting to codify provisions of recent legislation and related guidance that affect reporting under ERISA section 4010. The final rule modifies the reporting waiver under the current […]

Electronic Premium Filing Ready for 2016

The PBGC announces that it is now ready to accept online electronic premium filings for 2016. Document Excerpt 2016 Premium Filings: My PAA is now ready to accept electronic premium filings for plan years beginning in 2016. For additional information, see the following pages: Premium Payment Instructions & Addresses, What’s New in My PAA, Online […]

PBGC Request OMB Approve Information Collection to Locate Missing Participants

The PBGC is requesting that the Office of Management and Budget approve changes to an information collection needed to locate missing participants under a terminated defined benefit plan. Document Excerpt The Pension Benefit Guaranty Corporation (PBGC) is modifying its collection of information on Locating and Paying Participants (OMB control number 1212-0055; expires December 31, 2015) […]

Comments on Proposed Information Collection to Pay Participants

The PBGC request comments on its proposal to modify information collected in order to pay participants. Document Excerpt The Pension Benefit Guaranty Corporation (“PBGC”) intends to request that the Office of Management and Budget (“OMB”) approve modifications to a collection of information under the Paperwork Reduction Act. The purpose of the information collection is to enable […]

PBGC Disaster Relief For Parts of South Carolina

The PBGC announces disaster relief from its deadlines for parts of South Carolina hit by severe storms and flooding. Document Excerpt Pension Benefit Guaranty Corporation (“PBGC”) is waiving certain penalties and extending certain deadlines in response to the Severe Storms and Flooding that began on October 1, 2015, in South Carolina. Link

Articles, White Papers & Other Information

Supreme Court Decision Remanding Contraceptive Case

Unable to reach a decision, the Supreme Court has remanded the religious Affordable Care Act contraceptive case to the lower court for compromise. Document Excerpt In light of the positions asserted by the parties in theirsupplemental briefs, the Court vacates the judgmentsbelow and remands to the respective United States Courtsof Appeals for the Third, Fifth, […]

District Court Decision striking down ACA Cost sharing Payments to Insurers

The court found that the payments violated the Constitutional requirement that Congress must first appropriate the payments. Document Excerpt The question is whether Section 1402 can nonetheless be funded through the same, permanent appropriation. It cannot. Paying out Section 1402 reimbursements without an appropriation thus violates the Constitution. Link

GAO Report Finds Security and Privacy Enhancements Needed for Federal Exchange

The Government Accounting Office’s report finds that needs enhancements to protect security and privacy. Document Excerpt The Centers for Medicare & Medicaid Services (CMS) reported 316 security-related incidents, between October 2013 and March 2015, affecting—the web portal for the federal health insurance marketplace—and its supporting systems. According to GAO’s review of CMS records […]

Plan Cannot Recover Overpayments from Participant’s General Assets

The Supreme Court held that a plan cannot recover plan overpayments from a participant’s general assets where the proceeds from a settlement had been dissipated on nontraceable items. Document Excerpt We hold that, when a participant dissipates the whole settlement on nontraceable items, the fiduciary cannot bring a suit to attach the participant’s general assets […]

Women’s Pension Protection Act of 2015

The bill, if enacted, would extend spousal consent requirements to all individual account plans except where the distribution is being rolled over to another tax-deferred vehicle and would require coverage under retirement plans for certain part time employees. Document Excerpt Link

Supreme Court Upholds Subsidies in Federally Maintained Exchanges

In a 6-3 decision, the Supreme Court upholds subsidies in federally maintained exchanges in King v. Burwell. Document Excerpt Held: Section 36B’s tax credits are available to individuals in States that have a Federal Exchange. Pp. 7–21. Link

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