Tuesday, May 27, 2008

IRS Notice 2008-50 – Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates

Part III --- Administrative, Miscellaneous, and Procedural

IRS Notice 2008-50 – Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates

This notice contains updates for interest rates for funding requirements under sections 412(b)(5)(B) and 430(h)(2) of the Code applicable for May 2008, and updates for interest rates for minimum present value determinations under 417(e)(3) of the Code for April 2008.

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Friday, May 23, 2008

Retirement News for Employers - Spring 2008 Edition

The IRS released Retirement News for Employers - Spring 2008 edition. It contains the following articles:

  • EP Connections: Interview with Joyce Kahn - New Law...Help for the Small Employer
  • Desk Side Chat with Monika Templeman - What Do I Do if My Plan is Selected for an Examination?
  • New on the Web; We're Glad You Asked!
  • ERPA is Picking Up Speed
  • Product Profile - 401(k) Fix-It Guide - Online Resource
  • Written Plan Requirement for 403(b) Plans
  • This Way to the Forums
  • Recent Guidance
  • DOL News
  • Fixing Common Plan Mistakes - Hardship Distributions in a 401(k) Plan
  • Mark Your Calendar
  • Timing is Everything Flyer.

Monday, May 19, 2008

Friday, May 9, 2008

Governmental Plans Roundtable (April 22, 2008)

The IRS released Employee Plans News - Special Edition, May 2008 which discussed the Governmental Plans Roundtable held on April 22, 2008:

IRS Employee Plans hosted a Governmental Plans Roundtable on April 22, 2008 for members of the governmental plans community to begin a dialogue on how to best ensure that these plans satisfy the applicable qualification requirements while also identifying and addressing those unique issues that raise special challenges for governmental plans. See March 2008 Special Edition of the Employee Plans News announcing the Roundtable and the Spring 2008 Edition of the Employee Plans News for comments from the TE/GE Division Commissioner on the Roundtable.

The following sessions were presented at the Roundtable:

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Wednesday, May 7, 2008

Report Of The Working Group On Participant Benefit Statements

The DOL released the Report Of The Working Group On Participant Benefit Statements. The report was produced by the ERISA Advisory Council’s Working Group on Participant Benefits Statements and included the following primary recommendations to the Secretary of Labor for consideration:

Recommendation 1: The Department should provide longer due dates for defined benefit plan benefit statements, dates that recognize the time it takes to accumulate details of participant data necessary to calculate all participants' accrued benefits, and that recognize differences in accumulating data. Further, the Department should provide a means for obtaining relief from the due dates for those defined contribution plans with non-participant directed assets that cause delays in obtaining complete data because of the timing of determination of plan assets, such as contributions and asset valuation, participant compensation, and other matters inherent in the plan.

Recommendation 2: The Department should convene a Task Force of benefit statement stakeholders to develop the content of a model statement. The view of the Working Group is that the content should be minimized, including only that required by the statute. The model statement should be crafted in a way to inspire sponsors to add information and education. In that regard, the Working Group recommends including the application of IB 96-1 to the benefit statement to clearly communicate the boundaries of the information and education that could be included in benefit statements without crossing the "advice" threshold.

Recommendation 3: The Department of Labor should promulgate regulations that preserve the multi-document option for the benefit statement. Further, the Department of Labor should update its regulations regarding electronic communication to a "reasonable access" standard as in the Department of Treasury safe harbor regulation in recognition of the continued advancement in web-based communication and the increase in its use by participants.

The Report included the following sections:

  • Executive Summary
  • Introduction
  • Prior Law and Regulations, New Law, and Initial Guidance
  • Scope of the Working Group's Paper and Questions Distributed to Potential Witnesses
  • Concerns of the Department of Labor, Participants, Plan Sponsors and Service Providers
  • Working Group's Observations, Discussions and Recommendations
  • Summaries of the Speakers and Written Testimony
  • Additional Information Sources

History of New Rules and Regulations

Prior to the PPA, Prior law under ERISA §105 required the plan administrator to provide, only upon request, benefit statements to participants and beneficiaries; no more than one statement was required during a 12-month period. The information required to be furnished included the total accrued benefits and the total vested accrued benefits (or the earliest date on which benefits would become vested). Under ERISA §209, participants who terminated service with the employer or incurred a one-year break-in-service were required to receive a benefit statement. Prior law made no distinction as to the benefit statement requirements between defined benefit and defined contribution plans.

Under the new rules (as provided by the PPA), effective for plan years beginning in 2007 (with a delayed effective date for collectively bargained plans), automatic benefit statements are now required. The time period and the information furnished on the statements vary depending on the type of plan, including tri-annually for defined benefit plans (except that defined benefit plans may elect an alternative notice provision and continue to make statements available annually upon request), annually for non-participant directed defined contribution plans, and quarterly for participant directed defined contribution plans.

It is expected that the DOL through regulations will specify which plans are covered; the required content for the participant benefit statements; frequency of disclosure, as well as required due dates for compliance and periods of coverage; form of furnishing statements; and mode of delivery.

The Working Group Report was also discussed in DOL Working Group Ideas for Benefit Statements.

Friday, May 2, 2008

IRS Form 5500 Filing Update Web Cast

The DOL announced that they are hosting a Web Cast on the IRS Form 5500 reporting requirements on May 8:

Washington – The U.S. Department of Labor's Employee Benefits Security Administration (EBSA) will host a free web cast May 8 to help employers and plan administrators understand and comply with the Form 5500 Series reporting requirements under the Employee Retirement Income Security Act (ERISA).

This second in a series of web casts will help employers and plan administrators meet their obligations under ERISA to file timely and accurate financial reports on the operations of pension, health and other benefit plans. The web cast will address ways to avoid common filing errors, how to select the accountant best qualified to audit your plan, what to be aware of when reporting alternative investments, and rules on "blackout notices." It will also provide important information to 403(b) plan sponsors to help them prepare for expanded filing requirements, and preparing for an audit of the plan. The Internal Revenue Service will participate in the event to discuss its late and stop-filer program.

The series is being offered as part of EBSA's compliance assistance program – Getting It Right - Know Your Fiduciary Responsibilities – to help employers and plan administrators meet their fiduciary responsibilities and avoid potential civil penalties under the law.

This event is open to news media.

  • What: Web cast on Form 5500 reporting requirements
  • Who: Employers and plan administrators
  • When: May 8, 2008, Noon to 2 p.m. EST
  • Where: Live over the Internet at the URL below
  • How: Registration is required and available on a first-come, first-served basis. Visit EBSA's Web site at www.dol.gov/ebsa and click "Plan Filing Update Web cast" under "Compliance Assistance Seminars."
  • More Information: Call 202.693.8660

Here is a link to the Plan Filing Update Web Cast, the second in the series of webcasts. The first web cast, Know Your Fiduciary Responsibilities – An Update on Pension Protection Act and Related Guidance for Practitioners, is online and archived from the December 6, 2007 webcast.

Treasury Regulation REG-104946-07 – Hybrid Retirement Plans; Correction

26 CFR Part 1


RIN 1545-BG36

Treasury Regulation REG-104946-07 – Hybrid Retirement Plans; Correction

IRS Issues a Correction to the Proposed Cash Balance Regs

The IRS issued a correction to the Proposed Regulations on Hybrid Retirement Plans, commonly known as the proposed cash balance plan regulations, which the Service issued on December 27, 2007. Besides correcting a few grammatical errors, the IRS has made a significant change in Proposed Treas. Reg. section 1.411(a)(13)-1.

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IRS Notice 2008-47 – Public Comment Invited on Recommendations for 2008-2009 Guidance Priority List

Part III --- Administrative, Miscellaneous, and Procedural

IRS Notice 2008-47 – Public Comment Invited on Recommendations for 2008-2009 Guidance Priority List

The Department of Treasury and the Service invite public comments on recommendations for items that should be included on the 2008–2009 Guidance Priority List. Taxpayers may submit recommendations for guidance at any time during the year. Recommendations submitted by May 31, 2008, will be reviewed for possible inclusion on the original 2008–2009 Guidance Priority List. Recommendations received after May 31, 2008, will be reviewed for inclusion in the next periodic update.

Treasury, IRS Solicit Recommendation for 2008-2009 Guidance Priority List

IR-2008-62, April 18, 2008

WASHINGTON — The Department of Treasury and Internal Revenue Service invite public comment on recommendations for items that should be included on the 2008-2009 Guidance Priority List.

The Treasury Department's Office of Tax Policy and IRS use the Guidance Priority List each year to identify and prioritize the tax issues that should be addressed through regulations, revenue rulings, revenue procedures, notices, and other published administrative guidance. The Guidance Priority List focuses resources on guidance items that are most important to taxpayers and tax administration. Published guidance plays an important role in increasing voluntary compliance by helping to clarify ambiguous areas of the tax law.

The 2008-2009 Guidance Priority List will establish the guidance that the Treasury Department and IRS intend to issue from July 1, 2008, through June 30, 2009.

In reviewing recommendations and selecting projects for inclusion on the 2008-2009 Guidance Priority List, the Treasury Department and the IRS will consider the following:

  • Whether the recommended guidance resolves significant issues relevant to many taxpayers;
  • Whether the guidance may be appropriate for enhanced public involvement through the process described in Notice 2007-17, 2007-12 I.R.B. 748;
  • Whether the recommended guidance promotes sound tax administration;
  • Whether the recommended guidance can be drafted in a manner that will enable taxpayers to understand and apply the guidance easily;
  • Whether the IRS can administer the recommended guidance on a uniform basis; and
  • Whether the recommended guidance reduces controversy and lessens the burden on taxpayers or the IRS.

Please submit recommendations by May 31, 2008, for possible inclusion on the original 2008-2009 Guidance Priority List.

Information on how to submit recommendations can be found in Notice 2008-47. Taxpayers are not required to submit recommendations for guidance in any particular format. Taxpayers should, however, briefly describe the recommended guidance and explain the need for the guidance. In addition, taxpayers may include an analysis of how the issue should be resolved.

All comments will be available for public inspection and copying in their entirety.

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IRS Notice 2008-46 – Supplemental Guidance Under the Preparer Penalty Provisions of the Small Business and Work Opportunity Tax Act of 2007

Part III --- Administrative, Miscellaneous, and Procedural

IRS Notice 2008-46 – Supplemental Guidance Under the Preparer Penalty Provisions of the Small Business and Work Opportunity Tax Act of 2007

This notice provides guidance regarding implementation of the tax return preparer penalty provisions under section 6694 of the Code. Notice 2008–13 supplemented.

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