Journal of Pension Benefits articles from September 2004

Journal of Pension Benefits archives from September 2004

From the editor.
September 22, 2004... It is unbelievable to me that we're starting our 12th year of the Journal of Pension Benefits. I'm pleased to announce the promotions to Senior Editor of Susan Erickson and Lorraine Dorsa. Susan has been our 401(k) columnist since 2001....

Focus on ... qualified plan investments in real estate.
September 22, 2004... This article discusses the rules governing qualified plan investments in real estate. It does not discuss the rules applicable to real estate investments by other retirement vehicles [such as IRAs, SEPs, and 403(b) plans], although many of...

Keep your 412(i) wide open: view from an insider looking out.
September 22, 2004... Code Section 412(i) pensions are a bit different than other pensions. They are relatively inflexible because of the types of contracts funding the benefits, and the tax laws that guide their use. Yet these plans are often a good fit for small...

HIPAA privacy requirements and health care flexible spending accounts--have smaller employers forgotten something?
September 22, 2004... Many employers that insure their health benefits have traditionally expected their insurance companies to handle privacy requirements for their covered employees. Such reliance on other parties to protect critical employee information has...

Privatizing Social Security: the answer to retirement woes or Enron to the Nth power?
September 22, 2004... Social Security was enacted to provide working people with a safety net when they retire. The current call to privatize Social Security sounds promising, but does it really deliver? Social Security reform is a refrain that seems to be...

IRS issues proposed regulations on the conditions under which a plan amendment may reduce or eliminate protected benefits.
September 22, 2004... On March 22, 2004, Treasury and IRS issued proposed regulations, under Code Sections 411(d)(6) and 4980F and ERISA Sections 204(g) and 204(h), to reflect changes made by EGTRRA and the Retirement Equity Act of 1984. Such changes include...

Supreme Court clarifies status of owner-employees who participate in plans.
September 22, 2004... On March 2, 2004, the Supreme Court issued its decision in Raymond B. Yates, M.D., P.C. Profit Sharing Plan v. Hendon [124 S. Ct. 1330 (2004)], reversing an earlier decision of the Court of Appeals for the Sixth Circuit. The Yates decision...

Recent federal court decisions affecting the administration of ERISA plans.
September 22, 2004... As Congress approves additional layers of regulations under the Employee Retirement Income Security Act of 1974 (ERISA), federal courts are more frequently confronted with difficult issues impacting benefit plan administration. ERISA imposes...

Paying the administrative fees of a qualified plan.
September 22, 2004... In today's economy, plan sponsors are less likely to pay all costs of plan administration, leaving the plans themselves to pick up a greater share of such expenses. Fiduciaries now have a greater duty to determine the expenses properly paid...

COBRA disclosure: certainty, clarity, and consistency desired.
September 22, 2004... One year after issuing proposed regulations prescribing minimum standards for the timing and content of disclosures regarding the obligation to offer continuation coverage, DOL has issued common-sense final guidelines to lead plan sponsors...

The fiduciary duty to ask for help: fiduciaries are held to the highest legal standard. Where they are unsure of their expertise, fiduciaries must seek the advice of experts and carefully evaluate the advice given.(401(k) Investment Issues)
September 22, 2004... ERISA holds plan fiduciaries to a high legal standard... the responsibilities of fiduciaries have been described as the highest known to the law." [Donovan v. Bierwirth, 680 F.2d 263, 272 (2d Cir. 1982)] Obviously, not all fiduciaries have...

New IRS guidance on withholding tax treatment of cross border pension distributions.(Plan Distributions)
September 22, 2004... Details on the guidance provided by Revenue Procedure 2004-37 on the tax withholding obligations of persons making payments from U.S. pension plans to foreign employees or to employees who have performed services both in the United States and...

IRS postpones relative value disclosure requirements for forms of payment other than unsubsidized lump sums.(Plan Actuary)
September 22, 2004... The Internal Revenue Service (IRS) has postponed the effective date of relative value disclosures in qualified plans for forms of payment other than lump sum-type options that are less valuable than the qualified joint and survivor annuity...

The IRS gives automatic enrollment a boost: can employees default into retirement security?(401(k) Plans)
September 22, 2004... In a general information letter dated March 17, 2004, the IRS stated that there is no safe harbor automatic compensation reduction percentage, dispelling prior concern whether the automatic enrollment at 3 percent used in Revenue Ruling...

The changing face of nonqualified deferred compensation.(Nonqualified Plans)
September 22, 2004... Fundamental changes are anticipated in Congress on the tax treatment of nonqualified deferred compensation plans. The article reviews the Senate reforms, pointing out differences from the House version, and then discussing the broader...

Tips on cross testing or: give a man a fish, feed him for a day; teach him how to fish, feed him for a lifetime: some tips on cross testing, and sample calculations of the equivalent benefit accrual rate.(Plan Compliance)
September 22, 2004... Much of the material currently available on cross testing is apparently only providing information good enough for a day, because the most common question seems to be: "Is this a good candidate for cross testing?" Companies use many nifty...