DOL Move Expands Definition of Employer for MEPs
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In This Issue
Multiple Employer Plans (MEP) DOL Move Expands Definition of Employer for MEPs Abstract: The DOL published its highly anticipated Final Rule, which allows working owners with no employees and companies in unrelated industries to band together to create a single defined contribution retirement plan for their employees, known as a multiple employer plan (MEP). Specifically, the Final Rule expands the definition of "employer" under Section 3(5) of ERISA to allow bona fide employer groups and professional employer organizations to act as an "employer" for purposes of sponsoring a MEP. Source: Ballardspahr.com DOLs First Housekeeping Step in Getting Ready for New MEPs and Group Arrangement Rules Abstract: It's not just going to be challenging for benefit professionals: the IRS and the DOL are also going to have a number of challenges in regulating MEPs. The promise of the advantages of scale offered by these new arrangements may be valuable, but it involves the regulators translating rules, procedures, investigations and audits generally applicable on an individual plan into some sort of combined plan basis as a normal part of its activities. Which explains in large part the DOL's new Field assistance Bulletin, 2019-01. Source: Businessofbenefits.com Abstract: The new guidance from the DOL and the proposed compliance relief from the IRS have the potential to increase both the availability and the attractiveness of MEPs as an opportunity for small employers to pool retirement plan resources and collectively negotiate for better fees and services. Source: Sgrlaw.com Industry Reacts Positively to DOL's Association Retirement Plan Rule Abstract: Industry insiders believe that while the DOL's new rule on association retirement plans is somewhat disappointing in that it did not pave the way for open multiple employer plans for employers without a common nexus, it is a positive step in the right direction of providing yet another cost-effective option for small businesses to offer retirement plans. Source: Planadviser.com »» Click here for more on Multiple Employer Plans General Items A Guide to Retirement Savings for the Self-Employed Abstract: The self-employed have different approaches to consider in deferring income and investing some of their newly earned funds for retirement. This is a review of some of the most common strategies a self-employed person could utilize and explore the pros and cons of each. Source: Belr.com Insight: Studies, Research, and White Papers Abstract: A large majority of American adults (84%) report that student loans are negatively impacting the amount they are able to save for retirement, according to new research sponsored by TIAA and conducted by the MIT AgeLab. Nearly three out of four (73%) borrowers report they are putting off maximizing their retirement savings, saying they expect to begin or increase their contributions once their student loans are paid off. Among those who are not saving for retirement at all, more than one quarter (26%) point to the need to pay off student loan debt as the reason. Source: Tiaa.org »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers Hot Topics for 401k Plan Providers Abstract: The beauty of the retirement plan business is that it's constantly changing, the bad part of it is that it's constantly changing. As a plan provider, you always need to be on your toes because it's such a competitive marketplace that you can't afford to be asleep at the wheel. If you're not ahead of the curve, you will certainly be behind it and the history of this business is littered with plan providers who failed, just because they couldn't adapt to a changing environment. This article is about some of the hot topics that you should be aware of and using these topics for marketing help and to better focus your service. Source: Jdsupra.com Reducing the Number of 401k Recordkeeper Partners Poses a Challenge for Plan Advisers Abstract: Most retirement plan advisers work with dozens of recordkeepers because it's easier not to force new clients to change their 401k recordkeeper when the plan adviser is hired. But it's hard for plan advisers to manage working with so many providers. While consolidating their provider roster makes sense, the reality is that few advisers are taking major steps in that direction for practical reasons, and even fewer recordkeepers are focused on helping. Source: Investmentnews.com (registration may be required) 403b Plans 403b Plans Must Comply with the "Once In, Always In" Rule This Year Abstract: Tax-exempt employers whose 403b plans have failed to comply with the "once in, always in" eligibility rule in the past should be well on their way to compliance by now. IRS Notice 2018-95 granted limited relief from this common administrative failure. The grace period for non-compliance has ended for many, perhaps most, 403b plans, but all 403b plan sponsors should ensure that they comply this year. Source: Employeebenefitsupdate.com »» Click here for More 403b Material Plan Education and Communications This is How 401k Plan Sponsors Get Education Answers to These Three F-Words Abstract: Most plan sponsors have a pretty good handle on the benefits of having a diversified fund lineup. With the investment side of things long ago taken care of, 401k plan sponsors have a renewed focus on the three F-words of offering employee retirement benefits: Fiduciary, Fees, and Financial Wellness. Here's how plan sponsors answer questions related to each of these three F-words. Source: Fiduciarynews.com Participants Need More Education About Distribution Options Abstract: Forty-two percent of those between the ages of 35 and 65 who left a job where they had money in a 401k plan were unaware that they could have left the money in the plan, and 28% didn't know that some retirement distribution choices trigger tax liabilities and penalties, a survey found. Source: Plansponsor.com »» Click here for more on Plan Education and Communications Court and Legal Trend of Excessive Fee Suits Against Smaller Plans Continues Abstract: When the wave of excessive fee cases began against retirement plan sponsors, most targeted large or mega plans, based on assets. However, a new case against TriHealth Inc. continues a trend of targeting smaller plans. Source: Planadviser.com »» Click here for more Court and Other Legal Issues Compliance and Regulatory Plan Sponsors, Here's What Happens When You Assume Abstract: Assumptions can be good. Assumptions can also be questionable. Assumptions can even be downright bad in perilous life-or-death situations, such as when it comes to finding water in the wilderness, or when running a qualified retirement plan is involved. Here is a couple that pertain to the latter. Source: Conradsiegel.com Making Sense of the New Auditing Standard for ERISA Plans Abstract: SAS 136 clarifies and formalizes current best practices that auditors working with employee benefit plans should already be familiar with. It also provides detailed requirements unique to employee benefit plans, which will help auditors meet their obligations. Some of the most significant provisions found in SAS 136 are described here. Source: Ascensus.com Tackling the Missing Participant Problem Abstract: Missing participants, and the problems they cause, are becoming a more prominent problem for plan administrators, argues ERISA attorney Heather B. Abrigo. "It's really come to the forefront," said Abrigo, a partner at Drinker Biddle & Reath LLP, in a July 16 webcast offered by ASPPA. "Plan sponsors really need to start addressing the issue," she told attendees. Source: Napa-net.org DOL Issues PTE 2019-02 on IRA Auto-Portability Abstract: The DOL issued Prohibited Transaction Exemption 2019-02, which permits Retirement Clearinghouse, LLC to receive certain fees in connection with its IRA auto-portability program, which transfers an individual's default IRA or eligible mandatory distribution account assets to an individual's new defined contribution plan account. Source: Westlaw.com »» Click here for more Compliance and Regulatory Material Marketplace News PCS Retirement Acquires Aspire Financial Services »» Click here for More Marketplace News
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