The February 24, 2023, issuance by the IRS of proposed regulations on the use of forfeitures in qualified retirement plans provides some welcome clarity, regulatory house cleaning, and relief for plan sponsors. With a proposed effective date of January 1, 2024, these regulations should prompt plan sponsors to review their plan language and procedures for
Going to Bat for Hiring a Great Benefit Plan Auditor
Baseball season has just started, and retirement plan auditing season will soon kick into high gear. Many plan sponsors don’t see the value of a good auditor; they just see the audit as a cost of doing business. That’s too bad because these days when a plan sponsor becomes aware of an operational problem in
SECURE 2.0 Series Part 7: Matching Contributions Based on Student Debt Repayments and Financial Incentives
Additional Tools for Employers to Encourage Retirement Savings
Matching Contributions on Student Debt Payments
One of the most eagerly anticipated provisions of the “SECURE 2.0” legislation is the ability for employers to “match” within a defined contribution savings plan employees’ payments of student debt. This provision is just one of the many changes in SECURE
SECURE 2.0 Series Part 6: Changes to Retirement Plan Notice Requirements
The SECURE 2.0 Act of 2022 (SECURE 2.0) eliminates the requirement for plan sponsors to provide certain notices to eligible but unenrolled employees in defined contribution plans, changes the delivery method plan sponsors must use to furnish benefit statements to participants in retirement plans, and modifies the language required in annual funding notices under defined
SECURE 2.0 Series Part 1: More Roth, More Catch-Up, and Catch-Up As Roth
The SECURE 2.0 Act of 2022 (SECURE 2.0) contains several provisions that allow the federal government to have its cake (more tax dollars) and eat it too (more retirement savings, easing Social Security challenges). With SECURE 2.0, we find more Roth, more catch-up, and catch-up as Roth.
More Roth
Named after the late Delaware Senator
Secure 2.0 in the Consolidated Appropriations Act, 2023
As expected, the SECURE 2.0 Act of 2022 (SECURE 2.0), an extensive piece of legislation aimed at retirement plan reform, is included in the Consolidated Appropriations Act, 2023 (the Spending Bill). The 4,000+ page, $1.7 trillion Spending Bill was released early morning on Tuesday, December 20, with a passage deadline of Friday, December 23. If
‘Tis the Season… to Consider ESG Investments in Your 401(k) Plan
We recently summarized the regulatory back and forth of the past few years relating to environmental, social, and corporate governance (“ESG”) factors and their impact on ERISA retirement plans and the fiduciaries that oversee them.
As expected, the Biden administration released a proposed rule last year that re-opened the door (previously closed by the Trump
ESG Considerations for Retirement Plans: A Moving Target
For those with an eye on ERISA and its fiduciary rules, the past few years have caused whiplash when it comes to environmental, social, and corporate governance (“ESG”) investments in retirement plans. With a new rule from the Department of Labor imminent, let’s review where we are, how we got here, and what’s next.
ERISA
2023 Cost of Living Adjustments for Retirement Plans
The Internal Revenue Service recently announced its cost-of-living adjustments applicable to dollar limitations on benefits and contributions for retirement plans generally effective for Tax Year 2023 (see IRS Notice 2022-55). Most notably, the limitation on annual salary deferrals into a 401(k) or 403(b) plan will increase from $20,500 to $22,500 and the dollar threshold
The Impact Of Missing The July 31, 2022, Deadline For Restating Pre-Approved 401(K) Plans
For the many employers that use a pre-approved 401(k) plan (or another type of defined contribution plan), the deadline to execute a restatement of the plan was July 31, 2022. An employer that missed the deadline will need to (i) review whether a correction will be required to maintain the plan’s favorable tax status and