Benefits Forward

Monthly Lump Sum Interest Rates Released

administrator — Thu, 02 Jul 2009 15:39:05 +0000

The PBGC has released the applicable interest rate for lump sums in July.

Document Excerpt

The immediate interest rate for valuing lump sum payments for the month of July 2009 is 3.75%. The deferred interest rate I₁ is 4.00%, I₂ is 4.00%, and I₃ is 4.00%. (The immediate interest rate for June 2009 was 3.75% for lump sum payments; the deferred interest rate I₁ was 4.00%, I₂ was 4.00%, and I₃ was 4.00%).

Link http://www.pbgc.gov/rates/interest.html

Seventh Circuit Refuses Rehearing in Hecker v. Deere But Defines Limits of 404(c) Holding

administrator — Mon, 29 Jun 2009 16:04:31 +0000

The Seventh Circuit turned back attempts by the plaintiffs and by the DOL to rehear the Hecker v. Deere case with respect to the court’s alternative holding regarding the 404(c) safe harbor. However, the court did attempt to define and confine the limits of its interpretation of safe harbor status.

Link order-denying-rehearing-in-hecker

Revenue Ruling Lists Obsolete Guidance Resulting from 403(b) Regulations

administrator — Wed, 24 Jun 2009 15:49:01 +0000

Revenue Ruling 2009-18 lists various guidance now rendered obsolete as a result of the issuance of final Section 403(b) regulations.

Document Excerpt

In the “Effect of These Regulations on Other Guidance” section of its preamble, TD 9340 notes that since the prior set of section 403(b) regulations were issued in 1964, a number of guidance documents had become outdated due to numerous intervening statutory revisions enacted in section 403(b). In this section, the Internal Revenue Service (IRS) listed a number of documents that it proposed to obsolete after these regulations became final. The IRS received no comments regarding this prior notice to obsolete these documents.

The revenue rulings listed below are obsolete.

Link http://www.irs.gov/pub/irs-drop/rr-09-18.pdf

Summer Edition of Employee Plans News

administrator — Wed, 24 Jun 2009 15:42:45 +0000

The IRS has released its Summer, 2009 edition of Employee Plans News which includes the following articles:

EP Connections: Interview with Sarah Hall Ingram

ACT Issues Eighth Annual Report and Welcomes Ten New Members

Two-Year Adoption/Submission Period for DC Pre-Approved Plans Expires on April 30, 2010
The EPCU Insider
New Federal Income Tax Withholding for Pensions
Free Phone Forums
A New Look for EP Large Case Program Web Page
Web Spins - The Retirement Plans Site
We’re Glad You Asked!
PBGC Insights
The Corner of Forms & Pubs
Employee Plans Published Guidance
Highlights of the Retirement News for Employers
DOL Corner
Calendar of EP Benefits Conferences

Link http://www.irs.gov/pub/irs-tege/sum09.pdf

HELP Releases Summary of Health Care Option

administrator — Mon, 22 Jun 2009 14:49:52 +0000

The Health, Education, Labor and Pensions Committee has released a statement which includes a summary of the draft Affordable Health Choices Act.

Document Excerpt

WASHINGTON, D.C. – For the past year, Chairman Edward M. Kennedy and Democratic Members and staff of the Senate Committee on Health, Education, Labor and Pensions (HELP) have been working to develop legislation that reduces health care costs, allows Americans to keep the coverage they have if they want it, and makes health insurance affordable to those who do not have it today.

Today, while discussions between HELP Committee Democrats and Republicans on key outstanding issues continue, Chairman Kennedy released the landmark “Affordable Health Choices Act.” Click here for a copy of the bill,

http://help.senate.gov/BAI09A84_xml.pdf

.Link http://help.senate.gov/Maj_press/2009_06_09.pdf

No Tax Consequences from Personal Use of Cell Phones

administrator — Mon, 22 Jun 2009 14:43:48 +0000

After much back and forth, the IRS has asked that Congress issue guidance clarifying that there will not be tax consequences from the personal use of work-related devices such as cell phones.

Document Excerpt

Although some of the proposed changes would add clarity, the current law will inevitably leave widespread confusion among employees and businesses. Therefore, Secretary Geithner and I ask that Congress act to make clear that there will be no tax consequence to employers or employees for personal use of work-related devices such as cell phones provided by employers. The passage of time, advances in technology, and the nature of communication in the modern workplace have rendered this law obsolete.

Link http://www.irs.gov/newsroom/article/0,,id=209795,00.html

CBO Analysis of Cost and Coverage of Proposed Health Reform Option

administrator — Wed, 17 Jun 2009 14:20:55 +0000

The CBO estimates a net increase in the deficit of 1.0 trillion with a net increase in coverage of 16 million leaving approximately 39 million still uninsured under the Affordable Health Choices Act.

Document Excerpt

The Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation (JCT) have completed a preliminary analysis of the major provisions related to health insurance coverage that are contained in title I of draft legislation called the Affordable Health Choices Act, which was released by the Senate Committee on Health, Education, Labor, and Pensions (HELP) on June 9, 2009. Among other things, that draft legislation would establish insurance exchanges (called “gateways”) through which individuals and families could purchase coverage and would provide federal subsidies to substantially reduce the cost of that coverage for some enrollees.

The attached table summarizes our preliminary assessment of the proposal’s budgetary effects and its likely impact on insurance coverage.

Link http://www.cbo.gov/ftpdocs/103xx/doc10310/06-15-HealthChoicesAct.pdf

PBGC Update of July Interest Rates

administrator — Mon, 15 Jun 2009 18:28:34 +0000

The PBGC has updated its website to reflect the interest rate for valuing lump sums in July, 2009.

Document Excerpt

The immediate interest rate for valuing lump sum payments for the month of July 2009 is 3.75%. The deferred interest rate I1 is 4.00%, I2 is 4.00%, and I3 is 4.00%. (The immediate interest rate for June 2009 was 3.75% for lump sum payments; the deferred interest rate I1 was 4.00%, I2 was 4.00%, and I3 was 4.00%).

Link http://www.pbgc.gov/rates/interest.html

SEC Proposed Rules Facilitating Director Nominations by Shareholders

administrator — Mon, 15 Jun 2009 15:01:16 +0000

The SEC has issued proposed rules designed to make it easier for shareholders or groups of shareholders to nominate directors.

Document Excerpt

SUMMARY:

We are proposing changes to the federal proxy rules to remove impediments to the exercise of shareholders’ rights to nominate and elect directors to company boards of directors. The new rules would require, under certain circumstances, a company to include in the company’s proxy materials a shareholder’s, or group of shareholders’, nominees for director. The proposal includes certain requirements, key among which are a requirement that use of the new procedures be in accordance with state law, and provisions regarding the disclosures required to be made concerning nominating shareholders or groups and their nominees. In addition, the new rules would require companies to include in their proxy materials, under certain circumstances, shareholder proposals that would amend, or that request an amendment to, a company’s governing documents regarding nomination procedures or disclosures related to shareholder nominations, provided the proposal does not conflict with the Commission’s disclosure rules – including the proposed new rules.

Link http://www.sec.gov/rules/proposed/2009/33-9046.pdf

Fact Sheet on Compensation Committee Independence

administrator — Mon, 15 Jun 2009 14:54:40 +0000

In conjnction with the issuance of the Secretary’s statement, the Treasury has also issued a Fact Sheet on its proposal to give the SEC authority to ensure that compensation committees are sufficiently independent.

Document Excerpt

We will propose legislation that will give compensation committees greater independence, just as Sarbanes-Oxley did for audit committees. The legislation will direct the SEC to promulgate rules requiring companies listed on national securities exchanges to meet exacting standards for independence. Under these rules, not only would compensation committee members be truly independent from management, but the committee’s compensation consultants and legal counsel would be answerable only to the committee.

Link http://www.treas.gov/press/releases/reports/fact_sheet_indepcompcmte.pdf