2021 Annual Plan Compliance Review
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Compliance and Regulatory 2021 Annual Plan Compliance Review Offering a 401k plan can be challenging and meeting your important fiduciary responsibilities can seem overwhelming. Administering a plan and managing its assets requires certain actions and involve specific fiduciary responsibilities. This 8-page checklist will help guide you through the process. Source: Employeefiduciary.com Year-End Compliance Update for Retirement Plans As 2020 draws to a close, this is a good time for employers sponsoring retirement plans to wrap up year-end compliance issues and prepare for the upcoming year. Here is a quick list of topics that plan sponsors may want to consider as 2021 approaches. Source: Shrm.org By how much did the SECURE Act increased IRS Late Filing Penalties for Form 5500? How can you avoid them? Source: Belfint.com IRS Notice 2020-83 Provides 2020 Required Amendments List The Internal Revenue Service issued Notice 2020-83, which provides the 2020 Required Amendments List for qualified retirement plans and Section 403b retirement plans. Source: Westlaw.com »» Click here for more Compliance and Regulatory Material General Items Understanding Catch-Up Contributions Most retirement savings plans include a catch-up contribution provision. A catch-up contribution is a contribution to a retirement savings plan in addition to the standard limit. It's typically reserved for people aged 50 and older. Boosting your retirement savings in your 50s and 60s can help you save some money on taxes and reach your retirement goal. Source: Fool.com Fiduciary and Plan Governance White Paper on ERISA 3(16) Services This 8-page white paper offers insights into the principles that underlie conduct for 3(16) Plan Administrators. It also draws a line between third parties who are qualified to provide ERISA's comprehensive fiduciary 3(16) role and those that only pretend to do so. Source: Rolandcriss.com Stuff That Won't Help a Retirement Plan Sponsor Limit Their Liability For a retirement plan sponsor, many things can not limit liability if they aren't used. Other things will never limit a plan sponsor's liability whether they are used or not. This article is about those things that won't limit a plan sponsor's liability. Source: Jdsupra.com »» Click here for more Fiduciary and Plan Governance Material Insight: Studies, Research, and White Papers Retirement Savers Undeterred by COVID-19 Economic Downturn Americans overwhelmingly continued saving for retirement through DC plans during the first three quarters of 2020, undeterred by the economic downturn brought about by the COVID-19 pandemic, according to ICI. The study tracks contributions, withdrawals, and other activity in 401k and other DC retirement plans, based on DC plan recordkeeper data covering more than 30 million participant accounts in employer-based DC plans at the end of September 2020. This study also tracks coronavirus-related distributions among plan participants to provide insight into financial activity related to the pandemic. Source: Ici.org Student Debt Cuts Into Retirement Savings for All Age Groups Even though interest rates are lower, overall student debt has soared during the pandemic, regardless of a borrower's age or occupation. Some 44 million Americans now owe an estimated $1.67 trillion in student debt. The spiraling amounts of debt are having a serious impact on every generation's retirement outlook. A substantial majority (80%) report that student debt is cutting into their ability to save adequately for retirement. Source: Investopedia.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Service Providers Banks and trust companies maintaining collective investment funds took notice when the SEC announced enforcement proceedings against Great Plains Trust Company. The SEC found that Great Plains operated its CIFs as unregistered investment companies in violation of the Investment Company Act of 1940 and the Securities Act of 1933. Specifically, the SEC concluded Great Plains failed to satisfy the requirements of 1940 Act exclusions and corresponding 1933 Act exemptions for CIFs maintained by a bank. According to the SEC, the primary issue stemmed from Great Plains' failure to "exercise substantial investment authority" over the CIFs. Source: Klgates.com DOL Drops Off Final Fiduciary Rule at OMB In a year chock-full of proposed rules and final regulations, the Labor Department has wrapped up its work on a new fiduciary rule. According to a posting on the Office of Management and Budget website, the Labor Department on Nov. 24 dropped off its final rule on its proposed advice package. Source: Napa-net.org 403b Plans Terminating a 403b and Starting a 401k "I work with an Employee Retirement Income Security Act (ERISA) 403b plan sponsor that has a 403b plan in which each participant owns an individual annuity contract. We wish to replace the 403b plan with a 401k plan. Can we terminate the 403b plan and start a 401k plan immediately afterward? Are there any special legal issues in terminating the existing plan or starting the new plan, considering that participants are not terminating employment?" Source: Plansponsor.com »» Click here for More 403b Material Court and Legal A Look at the Current State of ERISA Class-Action Litigation This piece looks at the current ERISA class-action litigation landscape, including the types of ERISA cases that currently are being filed, the recent Supreme Court decisions, and the substantial settlements paid in many recent ERISA cases. Source: Dechert.com Excessive 401k Fee Suit Filed Against Parent Company of Victoria's Secret A former participant in the L Brands 401k Savings and Retirement Plan is suing the plan sponsor, its retirement plan committee, and unnamed individual fiduciaries for breaching their duties under ERISA. The lawsuit accuses plan fiduciaries of failing to benchmark recordkeeping fees and failing to monitor investment fees, among other things. Source: Planadviser.com DeMoulas Super Markets Agrees to $17.5M Settlement A settlement agreement has been filed in an ERISA fiduciary breach lawsuit filed against DeMoulas Super Markets and several of its top executives. Among other nonmonetary elements, the settlement calls for a payment of $17.5 million to be made to the plan and its participants, the dispersal of which will be tasked to an independent fiduciary. Plaintiffs accused the profit-sharing plan sponsor of investing too conservatively and applying an inappropriate one-size-fits-all default investment allocation for participants. Source: Planadviser.com "Imprudent" Asset Allocation Suit Settles for $17.5 Million A suit which had alleged that a profit-sharing plan's investment allocation was inappropriate and the plan fiduciaries' actions in establishing and maintaining it imprudent has settled. Unlike most of the litigation dealing with excessive fees and stock drop litigation, this involved a traditional profit-sharing plan, with participants' accounts funded solely by employer contributions, subject to a six-year vesting schedule. Source: Napa-net.org »» Click here for more Court and Other Legal Issues Marketplace News Reported SageView Sale Heats Up Already Hot RPA M&A Market
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