Journal of Pension Benefits articles from June 2006

Journal of Pension Benefits archives from June 2006

From the editors.
June 22, 2006... We are bidding a fond farewell to Melanie Knox, who has written our Plan Distributions column for the last 12 years. Melanie has taken a position with Employee Benefits Institute of America and will be doing a fair amount of writing for them....

Focus on ... investment education and advice for plan participants.
June 22, 2006... Anyone with responsibility for a corporate defined contribution plan knows that employees need help. [Shlomo Benartzi, "Implications of Participant Behavior for Plan Design," January 2006, available at www.alliancebernstein.com] ...

Wouldn't you really rather have a Roth? (redux): more guidance on Roth 401(k) and 403(b) plans.
June 22, 2006... 401 (k) and 403(b) plans that provide for traditional elective contributions may now include a qualified Roth contribution program. Plan sponsors have hesitated, puzzling over how Roth contributions fit into the qualified plan scheme,...

DOL provides new guidance regarding IRA investments and the prohibited transaction rules.
June 22, 2006... A recently issued Advisory Opinion from the DOL of Labor provides a cautionary tale for IRA owners regarding investments by an IRA with related parties. Running afoul of the prohibited transaction rules could result in "disqualification" of...

A best-practice strategy for disclosure.
June 22, 2006... The SEC's sweeping executive compensation disclosure reforms will compel companies to adopt a higher standard for disclosing pension benefits and other forms of executive pay, whether adopted as proposed. Heightened disclosure will dictate...

Finally final: the IRS issues final modifications to relative value disclosure regulations.
June 22, 2006... On March 24, 2006, the Treasury Department issued final regulations under Internal Revenue Code Section 417(a)(3) (the "2006 final regulations") that govern the explanation required to be provided to participants in conjunction with a...

Pre-ERISA breaks in service.
June 22, 2006... In McClain, the Seventh Circuit affirmed the district court's decision that a pension plan participant's period of service prior to a "break in service" that occurred before the effective date of ERISA could be disregarded in determining the...

Buyer beware: deferred compensation issues lurk where you may least suspect.
June 22, 2006... Addressing employee benefit liabilities in a merger or acquisition is a two-step process. Step one involves reviewing a target's plans, programs, and other benefit commitments to determine the target's current and future liabilities for...

Considering a DROP? A PLOP may fit better.
June 22, 2006... With the recent press concerning the unanticipated cost effects of what were originally intended to be "cost-neutral" deferred retirement option plans (DROPs), now is a good time to revisit DROPs and how they affect retirement decisions....

A syntheti(k)[SM] pension plan.
June 22, 2006... How to make a self-directed defined contribution plan look, feel, and taste like a conventional defined benefit pension plan. A defined contribution plan can be designed and managed to provide employees with the primary beneficial attributes...

Supreme Court unanimously decides health plans may seek reimbursement from participants who recover from third-party tortfeasors.(FIDUCIARY ISSUES)
June 22, 2006... In a 9-0 decision, the Supreme Court, in Sereboff v. Mid Atlantic Medical Services, Inc., ruled that plans may seek equitable reimbursement from a participant who recovers money damages for injuries caused by a third-party tortfeasor. [See...

The far-reaching effects of employment discrimination on retirement plans: practitioners are accustomed to dealing with discrimination issues in the context of ERISA's requirements. Many professionals fail, however, to focus on other discrimination laws to which retirement plans are subject: the federal antidiscrimination laws.(EMPLOYMENT ISSUES FOR EMPLOYEE BENEFIT PLANS)
June 22, 2006... Retirement plans are not exempt from the federal antidiscrimination laws. In fact, numerous plans have been subject to significant judgments as a result of their failure to satisfy these requirements. Federal law prohibits discrimination...

All about payment events under Code Section 409A, Part 1.(Nonqualified Plans)
June 22, 2006... This column is the first of a two-part series on NQDCA payment events. Part 1 focuses on the general rules applicable to all of the payment events and the key exceptions to those rules. Part 2 will focus on the individual payment event rules...

Roth 401(k) plans ... and we're rounding third base!(401(K) Plans)
June 22, 2006... This is a sequel to last issue's column on Roth 401(k) plans ["Roth 401(k) Features: Treasury Takes Us All the Way to... Um... Second Base," 13 J. of Pension Benefits 3], which discussed the finalized regulations in relation to the creation...

Takeover plans: taking over a plan can consume substantial amounts of your time, but if done properly, it will result in a loyal client. But before taking on such a plan, be sure to exercise due diligence and find out exactly what you are getting into.(Plan Administration)
June 22, 2006... Adding a pre-existing plan to your clientele is always an interesting experience. Rarely is it a perfect match administratively and an amicable parting from the prior administration firm. More often there are service and fee issues,...

Alternative investments in a separate account option in defined contribution plans.(Plan Investments)
June 22, 2006... Responding to pressure from a small number of participants, plan sponsors are offering an investment option that allows employees to invest in securities not offered inside the plan. Often referred to as the brokerage account option, this...