Journal of Pension Benefits articles from September 2002

Journal of Pension Benefits archives from September 2002

From the editor.(Editorial)
September 22, 2002... If you're holding this issue of JPB in your hand (as opposed to reading it online), you'll be amazed at the bulk of it. Our latest issue of JPB is among our longest at just under 140 pages. Prolific authors? Well, yes. Some of our features...

How should employees choose a form of pension? (Article).
September 22, 2002... Choosing a form of pension is a complex decision, generally requiring an employee to determine the adequacy of retirement income under each of the various forms of pension available. This article explains how to do that using two detailed...

Domestic partner benefits in the workplace. (Article).(companies will increasingly offer domestic partner benefits, despite legal complexity and costs)
September 22, 2002... Whether to attract and retain qualified employees or to be consistent with their own anti-discrimination policies, more employers are offering domestic partner benefits to their employees. Those considering doing so must address a number of...

Focus on ... the Department of Labor regulations on summary plan descriptions and claims procedures. (Article).
September 22, 2002... New DOL regulations will require many ERISA plans to make substantial changes to their SPDs and claims procedures. This article reviews those regulations, with emphasis on the applicability to retirement plans. ********** On...

Revenue Procedure 2002-21. (Article).(retirement plans for leased employees, or professional employer organizations)
September 22, 2002... In 1982, Congress introduced the concept of leased employees, persons that work for one employer (the leasing organization) but are actually performing services for someone else (the recipient). For many retirement plan and other employee...

How HIPAA will change group health plan administration. (Article).(privacy requirements of Health Insurance Portability and Accountability Act of 1996 )
September 22, 2002... By April 14, 2003, most group health plans must amend their plan documents to incorporate the HIPAA privacy standards. This article includes a sample plan amendment, as well as a suggestion for how to handle requests for information protected...

Disability distributions under retirement plans. (Article).
September 22, 2002... DOL regulations revised in 2000 impose more onerous claims procedures on disability benefit claims than on pension benefit claims. This article explains the differences between the procedures and how retirement plan sponsors can avoid being...

Record retention guidelines. (Article).(for pension plans)
September 22, 2002... Proper record retention is essential for the administration of a qualified retirement plan. This article explains the record retention requirements of the DOL and the PBGC and considers record retention in on electronic age. **********...

The first summer after Enron, or honey, who shrank our retirement account balance? This column takes a look at a number of issues that are of particular importance to fiduciaries who administer 401(k) plans and to the employers that maintain those plans, including timely 401(k) deferrals and Enron-inspired legislation on blackout periods. (Legal Developments).
September 22, 2002... In the heat of late July, the stock market is withering, hopes of retiring early on the gains of the go-go years have faded, and each day brings news of another government investigation of corporate practices. Investor confidence has gone...

ERISA section 404(c)--how does it really work, and what does it matter? (401(k) Investment Issues).(fiduciaries could be liable for imprudent 401k plan investments in participant-directed plans)
September 22, 2002... The bear market has caused large losses for participants in 401(k) plans. These losses have highlighted the need for fiduciaries to act prudently as required by ERISA Section 404(a) and to obtain the protections offered by ERISA Section...

IRS issues proposed regulations on ERISA section 204(h) notice requirements: the proposed Treasury regulations interpreting EGTRRA's changes with respect to ERISA Section 204(h) notices are described in detail in this column. (Plan Distributions).
September 22, 2002... On April 23, 2002, the Internal Revenue Service (IRS) issued proposed regulations relating to the requirements of Section 4980F of the Internal Revenue Code of 1986 (Code) and Section 204(h) of the Employee Retirement Income Security Act of...

IRS issues new Revenue Procedure on EPCRS: the changes made by Revenue Procedure 2002-47, including expansion of the Anonymous Submission Procedure, make EPCRS more user-friendly. The authors review those changes and suggest others that the IRS should make in 2003. (Voluntary Correction Issues).(Employee Plans Compliance Resolution System for correcting defects in various plans made more user-friendly)
September 22, 2002... On June 27, 2002, the Internal Revenue Service (IRS) released Revenue Procedure 2002-47, which updates its guidance under the Employee Plans Compliance Resolution System (EPCRS) for correcting defects in qualified plans, 403(b) arrangements,...

IRS proposes rules to expand content requirement for notices of future benefit reductions; the proposed content requirements for notices to participants of defined benefit plan amendments significantly reducing the rate of future benefits accruals are described in this column. (Plan Actuary).(to meet conditions of EGTRRA legislation)
September 22, 2002... The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) substantially expanded the participant notification requirement for plan amendments that significantly reduce the rate of future benefit accruals in qualified defined...

The combination cash balance/401 (k) approach: this column takes a thorough look at testing a combination cash balance/401 (k) plan for nondiscrimination using a typical plan designed for a hypothetical client. (Small Plan Design).(pension plan combining cash balance and 401k features discussed)
September 22, 2002... With the demise of the combined plan limits of Section 415(e) of the Internal Revenue Code (Code), as well as the plethora of limit increases under the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), plan consultants are...

Eighth Circuit sets precedent on standing and statutory exemption for fiduciary self-dealing: the Eighth Circuit's decision in Harley holds that ERISA Section 408(c)(2) provides a separate exemption for fiduciary self-dealing as long as the compensation paid was reasonable and it may open the door for a challenge to the DOL regulation under ERISA Section 408(b)(2). (Plan Fiduciary).(pension plan fiduciary has separate exemption from liability when fiduciary compensation is reasonable, decision states)
September 22, 2002... Shortly after ERISA was enacted, the U.S. Department of Labor (DOL) issued a regulation stating that ERISA Section 408(c)(2), the statutory provision that allows a fiduciary to be paid for rendering services to a plan, did not provide a...

Designing DB-DC combination plans: an employer offering a DB-DC plan faces added administrative cost and complexity, the deduction limit of Code Section 404(a)(7), and additional nondiscrimination testing, all of which are discussed in this column. (Plan Compliance).(combined defined benefit/defined contribution pension plans offer participants good choices but make it harder for companies to administer)
September 22, 2002... Many employers sponsor only one type of retirement plan--either a defined benefit (DB) plan or a defined contribution (DC) plan, and if they sponsor a DC plan, it is usually a 401(k) plan. There is no requirement limiting an employer to only...

Companies take the lead on company stock: as Congress debates what to do about retirement plan investment in company stock, some companies have begun taking action on their own. Will any of it affect how participants invest? (401(k) Plans).
September 22, 2002... We've entered the dog days of summer as this column is being written, and it seems increasingly likely that Congress will let sleeping dogs lie when it comes to 401(k) plan investment in company stock. Although the House of Representatives...

Electronic 5500 filing--is it the future? This column describes one plan administration firm's experience with filing Form 5500 electronically. The transition form paper filing was not always smooth but it has produced considerable cost savings. (Plan Administration).(electronic filing of pension documents)
September 22, 2002... On something of a whim when the new Form 5500 was issued, our firm looked at filing electronically as a preparer of Form 5500 for plan sponsors. After reviewing electronic filing requirements and discussing why we would want to change our...

New proposed regulations under Code Section 280G: the option to choose between the 1989 and 2002 proposed parachute payment regulations until January 1, 2004, raises some interesting transition issues. The author explains those issues, as well as the major differences between the old and new regulations. (Nonqualified Plans).(taxation of executive compensation)
September 22, 2002... Internal Revenue Code (Code) Section 280G limits the deduction available with respect to certain payments made to disqualified individuals upon a change of control. {26 U.S.C. 280G} Code Section 4999 imposes a 20 percent excise tax on such...