The Department of Labor has issued final regulations that will enable employers to electronically provide required information and documents to more plan participants. Although employers have been able to electronically provide some documents and information to some participants under existing rules, use of electronic delivery was limited because of an affirmative consent requirement that applied
IRS Answers Some FAQs on Coronavirus-Related Distributions and Loans
On May 4, 2020, the IRS provided guidance on coronavirus-related distributions (“CRDs”) and coronavirus-related loans and loan payment delays (“CR Loan Provisions”) in the form of FAQs. In those FAQs, the IRS answered a few of the questions that many practitioners, administrators, and employers have been asking:
- Does a spouse’s loss of income trigger eligibility
CARES Act offers Opportunity for Tax-Free Student Loan Repayment Available until 2020 Year-End
On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which addresses the public economic and health crisis related to the 2019 novel coronavirus (COVID-19). The CARES Act includes a temporary provision that allows employers to make tax-free student loan payments on behalf of employees pursuant
IRS Answers FAQs That Arise When Participants are Slow to Cash Distribution Checks
Participants and beneficiaries are sometimes slow to cash qualified retirement plan distribution checks, especially when the checks are relatively small. This may result in the check being cashed in a year after the year the check was received. Sometimes it is not cashed at all.
In this situation, a common question from plan administrators is
Time is Running out for 403(b) Plan Sponsors to Meet March 31, 2020 Adoption Deadline
Employers sponsoring 403(b) plans should be aware that we are nearing the deadline for adopting a pre-approved 403(b) plan that provides relief for any documentary noncompliance back to January 1, 2010 (or, if later, the effective date of the plan). As a reminder, adopting a pre-approved plan is the only way a plan sponsor may
IRS Expands Determination Letter Program to Hybrid and Merged Plans
The IRS has issued guidance (Rev. Proc. 2019-20) expanding the determination letter program for certain individually designed plans. The IRS had previously announced in 2017 that the determination letter program for individually designed plans would be limited to initial plan qualification and qualification on plan termination. Since that time, the IRS received many
All Businesses, even if not Subject to 162(m), Should Consider Gathering Data to Support Future Deduction of Deferred Compensation under the Grandfather Rule
As mentioned in a previous blog, the IRS has issued its initial guidance on Code Section 162(m), as modified by the Tax Cuts and Jobs Act. One important aspect of the guidance is its discussion of preserving deductibility under the transition rule, also known as the 162(m) “grandfather” rule. Under the grandfather rule, compensation paid
IRS Guidance Provides Some Clarity, but Leaves Questions Unanswered under 162(m)
On August 21, 2018, the IRS issued its initial guidance on the amendments to Section 162(m) made by the Tax Cuts and Jobs Act, in the form of Notice 2018-68. The guidance is fairly limited and does not completely address some of the questions it takes on. Notably, the guidance on what compensation will
New Disability Claims Procedures May Apply to Qualified and Nonqualified Retirement Plans, Too
As mentioned in our recent blog, the date for complying with the new disability claims procedures (April 2, 2018) is rapidly approaching. In addition to making sure disability plans comply with the new rules, employers should also be reviewing other ERISA plans, such as qualified retirement plans and nonqualified deferred compensation plans to determine
Back to Basics – Costly Consequences of Ignoring Process in Benefits Administration
The stories of an employer and a long-term disability insurer and claims fiduciary for an ERISA plan, defendants in two recent cases, ring so true. In the first case, the insurer was designated as claims fiduciary for an employer’s long-term disability plan, and ended up in litigation with the least friendly standard of review –