Introduction When a plan fiduciary contemplates investing plan assets in any type of investment, there must always be considerations of prudence, both in the process of making the decision and in the decision to invest. For some types of investment vehicles, though, there can be additional concerns, such as the possibility of prohibited transactions or […]
Author: Trucker Huss
Not too long ago, the Ninth Circuit Court of Appeals gave ERISA plan administrators a sharp jolt when it ruled that a plan’s failure to decide a benefits claim within the time limits set forth in the plan or under Department of Labor regulations would deprive the plan’s ultimate determination of the claim of the […]
On June 1, 2005, the Department of Labor (“DOL”) and the Securities and Exchange Commission (“SEC”) jointly released tips to help ERISA plan fiduciaries in selecting and monitoring “pension consultants.” These recommendations were made in response to a May 16, 2005 report issued by the SEC, which raised concerns as to whether pension consultants were […]
General On May 25, 2005, the Internal Revenue Service (the “IRS”) published comprehensive proposed regulations under Section 415 of the Internal Revenue Code (the “Code”) dealing with limitations on benefits and contributions for qualified plans. Code section 415 establishes specific limits on benefits under qualified defined benefit plans and on contributions and other additions under […]
On March 2, 2005, the Internal Revenue Service published proposed amendments to the regulations under sections 401(k) and (m) of the Internal Revenue Code (the “Code”). The proposed regulations provide guidance concerning the requirements that must be met for a contribution to be a designated Roth contribution under Code section 401(k). Background Section 402A, added […]
The Internal Revenue Service (“IRS”) recently relaxed the “use it or lose it” rule that applies to Section 125 cafeteria plans (“Section 125 Plan”), by allowing an additional 2½ month “grace period” following the end of a Section 125 Plan’s plan year. During the grace period, a participant may incur expenses that may be paid […]
In a ruling anxiously awaited by many pension plans (particularly multiemployer plans), the Internal Revenue Service has issued a revenue procedure pursuant to Section 7805(b) of the Internal Revenue Code that significantly limits the retroactive application of the Supreme Court’s decision in Central Laborers’ Pension Fund v. Heinz, 124 S.Ct. 2230, decided on June 7, […]
Bankruptcy Reform The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (S.256) was signed by the President on April 20, 2005. In addition to its general overhaul of the bankruptcy law, the Act contains some provisions specifically relevant to employee benefit plans: Expanded Exclusion.The Act extends the exclusion from a debtor’s estate to encompass […]
The Employee Retirement Income Security Act of 1974, as amended (“ERISA”), imposes significant responsibilities upon the plan sponsor of an employee benefit plan. Given the gravity of these fiduciary obligations, many employers choose to create an administrative committee (a “Committee”) devoted to the proper management and control of the operation and administration of the retirement […]
On January 28, 2005, the Centers for Medicare and Medicaid Services (CMS) issued final regulations on the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (the “Act”). As discussed in our previous article on this topic, the Act makes prescription drug coverage, called Part D, available to certain Medicare-eligible retirees beginning January 1, 2006. […]
On December 29, 2004, the Internal Revenue Service (IRS) issued long awaited final regulations governing cash or deferred arrangements (CODAs) under Code section 401(k) and matching contributions under Code section 401(m) that consolidate and simplify previous guidance, as well as reflect substantial legislative changes. This article will highlight significant provisions of the final regulations. Background […]
On December 30, 2004, the Internal Revenue Service, Department of Labor and Department of Health and Human Services jointly issued final and proposed regulations governing the group health plan portability provisions of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”). Applicable to plan years beginning on or after July 1, 2005 (i.e., January […]
The Internal Revenue Service (the “IRS”) has issued proposed regulations under Section 403(b) of the Internal Revenue Code (the “Code”), as well as proposed and temporary regulations under related provisions of the Code. Code section 403(b) governs plans that involve retirement annuity contracts, mutual fund custodial accounts for employees of certain tax-exempt organizations and public […]
On October 21, 2004, President Bush signed into law the American Jobs Creation Act of 2004. The Act created a new section of the Internal Revenue Code (“Code”), Section 409A, which contains new rules regarding nonqualified deferred compensation plans. See our October 2004 Hot Topics update for more information regarding the new deferred compensation rules […]
In October 2004, the Department of Labor issued Field Assistance Bulletin No. 2004–02 (the “Bulletin”) dealing with fiduciary duties with respect to missing participants in terminated defined contribution plans. The missing participant program of the Pension Benefit Guaranty Corporation applies to defined benefit plans. Background and Applicable Law The problem of missing participants is particularly […]
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