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2016 Cost of Living Adjustments Announced The IRS has released the cost of living adjustments that affect the dollar limits for both retirement plans and health & welfare plans for the 2016 tax year. Most limits […] Key words: ,,

PPA Restatements for Defined Contribution Plans The IRS requires all retirement plans to be restated periodically to ensure that a plan accurately reflects current regulations and legislation. The current round of restatements is referred to as […] Key words: ,

Revisions to the IRS Determination Letter Program Historically, a plan sponsor could get assurance that their retirement plan was in compliance with current laws and regulations by requesting a favorable determination letter from the IRS, which allowed […] Key words: ,,,

Significant Changes to GASB Reporting of OPEB Liabilities Other Post-Employment Benefit (OPEB) accounting standards are once again in the spot light. The Government Accounting Standards Board (GASB) issued two pronouncements (GASB statement numbers 74 and 75) in June […] Key words: ,

IRS Limits Lump Sum Distribution Options In Notice 2015-49 the IRS placed limits on the ability of a plan to offer lump sums to participants that are receiving annuity payments from a defined benefit plan.  The […] Key words: ,,,,

Impact of Obergefell v. Hodges on Employee Benefit Plans The United States Supreme Court (“Court”) ruled in Obergefell v. Hodges (“Obergefell”) that same-sex marriage bans are unconstitutional. The decision in Obergefell is a continuation of the Court’s expansion of […] Key words: ,,,

Monitoring Differing Terms in your SPD vs. the Plan Document A recent court case out of the Sixth Circuit (Pearce v. Chrysler Group LLC Pension Plan) reminds plan sponsors to carefully monitor the terms and provisions used in the retirement […] Key words: ,,

Understanding Participant Behavior in Lump Sum Cashout Windows In 2014 many plan sponsors offered their vested and terminated participants the option of electing a lump sum distribution instead of waiting until retirement to receive their benefits.   While this […] Key words: ,,

Why Does Moving From A Defined Benefit to Defined Contribution Often Result in Benefit Cuts? Let’s assume that a defined contribution (DC) plan has been designed with the same level of employer contribution as a defined benefit (DB) plan the employer previously sponsored.  A common […] Key words: ,

Plan Sponsors Must “Furnish” Summary Plan Descriptions (SPD) to Participants In today’s age, the push is being made by everyone to furnish communications electronically.  For retirement plans that are subject to ERISA, communications may be furnished electronically as long as […] Key words: ,,

Plan Sponsors Must Track Loans and Hardship Distributions The IRS has indicated in Employee Plans News 2015-4, that it is ultimately the plan sponsor’s responsibility to track loans and hardship distributions from their retirement plan(s). According to the […] Key words: ,

Supreme Court Strengthens Plan Sponsors’ Duty to Monitor Investments On May 18, 2015, the Supreme Court (“Court”) ruled in Tibble v. Edison International that ERISA’s 6-year statute of limitations period had not passed for plaintiffs that were pursuing a […] Key words: ,,,

IRS Updates Correction Program for Certain Failures Regarding Elective Deferrals The IRS has issued an update to the Employee Plans Compliance Resolution System (EPCRS), which is the IRS’ voluntary correction program.  Revenue Procedure 2015-28 changes the correction method for failure […] Key words: ,,

IRS Releases 2016 HSA Contribution Limits The IRS has released the 2016 cost-of-living increases for Health Savings Accounts (HSAs) and High Deductible Health Plans (HDHPs).  The 2016 HSA contribution limits are: Self-only coverage – $3,350 (no […] Key words: ,,,

DOL Changes Deadline for Participant Fee Disclosure Recently, the Department of Labor (“DOL”) announced a revision to the timing rule plan administrators must comply with when delivering annual participant disclosures under ERISA 404(a)(5). Under 404(a)(5), administrators of […] Key words: ,,

How are Low Rates Impacting Pension Buyouts? Corporate bond rates are at historic lows.  Pension plans apply these rates to discount future expected benefit payments.  Thus, in a low-interest rate environment, plans see their liabilities increase.  This […] Key words: ,,

Pension Plan De-Risking: Pension Settlements A pension settlement (also called a pension buyout) occurs when a plan sponsor transfers its liabilities to an insurance company through the purchase of a group annuity contract.  It allows […] Key words: ,,,

2015 Transit Benefit Update IRS Notice 2015-2 extends retroactively for 2014 a measure that increases the maximum monthly exclusion amount for mass transit passes and van pool benefits from $130/month to $250/month. This was […] Key words:

IRS Updates Employee Plans Compliance Resolution System The IRS has issued an update to its voluntary correction program for retirement plans, the Employee Plans Compliance Resolution System (EPCRS).  Revenue Procedure 2015-27 is meant to be a modification, […] Key words: ,,

IRS Extends Testing Relief for Closed Defined Benefit Plans Often, when a defined benefit (DB) plan excludes new employees, those new employees will participate in a defined contribution (DC) plan.  Over time, as the proportion of the DB plan […] Key words: ,

What information does a plan fiduciary have the duty to provide? There are a number of things that the fiduciary is required to disclose to participants and beneficiaries.  The disclosure of such items is governed by Title I of ERISA.  The […] Key words: ,,

What does it mean to De-Risk my Pension Plan? The term de-risking is used in the pension world to describe plan sponsor activities that reduce financial risks.  These risks could include interest rate changes, fluctuations in investment portfolios, increases in […] Key words: ,,,,

What happens if I don’t restate my retirement plan? The IRS requires the periodic restatement of a qualified retirement plan so the document will contain the latest required provisions.  Without these required provisions, the document could cause the plan […] Key words: ,,,

Transit Benefit 2015 Update IRS Notice 2015-2, issued in January 2015, extends retroactively for 2014 a measure that increases the maximum monthly exclusion amount for mass transit passes and van pool benefits from $130/month […] Key words: ,

IRS Releases 2015 COLA Adjustments for Health FSAs, Transportation Benefits and More The IRS has issued their annual limits for certain employee fringe benefits in Revenue Procedure 2014-61.  This includes an increase of the dollar amount employees may contribute to health FSAs, […] Key words: ,,,

New Cash Balance Regulations Background Cash balance plans are defined benefit plans in which a participant’s benefit is composed of an annual employer contribution and an interest credit (this credit is guaranteed and not […] Key words: ,,,

Two New Election Changes for Cafeteria Plans Beginning September 18, 2014, cafeteria plans were permitted to let employees prospectively revoke an election for coverage under a group health plan in two new situations.  These are in addition […] Key words: ,

HR Executives: Are You Ready For the Good Times Again? It should come as no surprise to Human Resource (HR) executives in most organizations that the last 6 years have been lean times for HR departments and initiatives.  When organizations […] Key words: ,,,

ERISA Fee Case Goes to Supreme Court The U.S. Supreme Court recently agreed to review Tibble v. Edison International, a case involving retirement fees alleged to be excessive.  The case arrives at the Court after two lower […] Key words: ,,,

2015 Cost-Of-Living Adjustments Announced  2015 Cost of Living Adjustments Announced  The IRS and Social Security Administration have released the cost of living adjustments that affect the dollar limits for retirement plans for the 2015 […] Key words: ,,

Pension Funding Relief: What’s In It for My Plan? On August 8, President Obama signed the Highway and Transportation Funding Act of 2014.  This new law provides defined benefit plan sponsors with extended relief from the low interest rate […] Key words: ,,,

How do you terminate a defined benefit plan? Terminating a defined benefit (DB) pension plan is a complicated process that is very deadline driven.  There are many traps if you don’t have reliable advisors working with you.  The […] Key words: ,,,,

IRS Releases QLAC Rules to Address Longevity Risk On July 2, 2014, the IRS released final rules regarding longevity annuities.  The rules are meant to address the financial risks of increased life expectancy and insufficient retirement assets.  Financial […] Key words: ,,,

IRS Answers Questions about FSA Carryovers and HSA Eligibility Late last year, the IRS issued Notice 2013-71 to allow cafeteria plans to carry over a participant’s unused health FSA funds (up to $500) from one plan year into the […] Key words: ,

What are the 2015 HSA Contribution Limits? The IRS has released the 2015 cost-of-living increases for Health Savings Accounts (HSAs) and High Deductible Health Plans (HDHPs).  The 2015 HSA contribution limits are: Self-only coverage: $3,350 (up $50) […] Key words: ,,,

How to Satisfy IRS Safe Harbor for Accepting Rollover Contributions Many retirement plan sponsors want to offer employees the convenience of rolling their account balances from other plans into their new employer’s plan.  However, an invalid rollover will jeopardize the […] Key words: ,

Does the DOMA Decision Mean We Have to Amend Our Plan? On April 4, 2014, the IRS issued Notice 2014-19 providing guidance on when qualified retirement plans must be amended to conform with the Supreme Court decision in United States v. […] Key words: ,,

Should We Change Our COBRA Notices Because of the Affordable Care Act? Under the Consolidated Omnibus Budget Reconciliation Act (COBRA) a group health plan must provide each covered employee and their spouse with a written notice of COBRA rights at the time […] Key words:

Mid-Year Amendments to Safe Harbor 401(k) Plans: When Are They Allowed? The IRS is very restrictive when it comes to mid-year amendments to a safe harbor plan. Participants must receive a safe harbor notice prior to the beginning of the plan […] Key words: ,

How to Correct a Failure to Provide a Safe Harbor 401(k) Notice? The IRS, in the February 2014 issue of Retirement News for Employers, explained how an employer can correct the mistake of failing to distribute a safe harbor 401(k) notice. IRS […] Key words: ,,

Proposed 408(b)(2) Guide: What You Need to Know? In 2012, the Department of Labor (DOL) issued regulations requiring the disclosure of information to help plan fiduciaries make an informed decision on whether the fees charged to a plan […] Key words: ,

90-Day Limit on Group Health Plan Waiting Period Finalized The U.S. Departments of Labor, Treasury, and Health and Human Services (the “Departments”) have jointly issued final regulations finalizing a 90-day limit on waiting periods for health coverage. The final […] Key words: ,

Obama Introduces myRA Program During the State of the Union address on January 29th, President Obama announced a new retirement account called the “myRA”. The President signed a memo directing the Department of the […] Key words: ,

Bill Seeks to Encourage MEPs & Larger Matching Contributions Chairman of the Senate Special Committee on Aging, Senator Nelson (D-FL) and Ranking Member of the Committee, Senator Susan Collins (R-ME) recently introduced The Retirement Security Act of 2014.  The […] Key words: ,,

Proposal Would Have Large Impact on Small Plans Senator Tom Harkin (D-IA), Chair of the Senate Health, Education, Labor, and Pensions Committee, introduced the Universal, Secure, and Adaptable (USA) Retirement Funds Act of 2014.  There is a growing […] Key words: ,

Recent Retirement Proposals: What You Need to Know? Three recent developments in Washington, D.C. demonstrate a renewed attention to Americans’ retirement challenges.  Each of these proposals is primarily aimed at employees of small employers who do not offer […] Key words: ,,,

IRS Issues Guidance on In-Plan Roth Rollovers Recently, the IRS issued Notice 2013-74 (“Notice”), which provides guidance on in-plan Roth rollovers.  Part of the guidance in the Notice relates specifically to an in-plan Roth rollover of amounts […] Key words: ,

Testing Relief for Closed Defined Benefit Plans Often, when a defined benefit (DB) plan excludes new employees, those new employees will participate in a defined contribution (DC) plan.  Over time, as the proportion of the DB plan […] Key words: ,,

ERISA Stock Drop Case Goes to Supreme Court On December 13, 2013, the U.S. Supreme Court agreed to hear a case involving a plan fiduciary’s duties under ERISA.  The case, Fifth Third Bancorp v. Dudenhoeffer, involves an allegation […] Key words: ,

PBGC Premium Changes: How Will They Affect Your Plan?  Changes to the Amount and Timing of PBGC Premiums Two important changes to PBGC premiums come into effect for the 2014 plan year.  The first change increases the amount of […] Key words:

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The Nyhart Knowledge Center is a free resource to CFOs and HR executives to help you resolve and understand the complex issues regarding your actuarial and employee benefit questions. The Knowledge Center is an archive of answers from our team of actuaries, administrators and retirement consultants and is intended to help provide you with the background you need.