Retirement plan fiduciaries should meet on an annual basis (if not more frequently) to discuss the plan with outside service providers, including the investment advisor, custodian/trustee, and third-party administrator. In this blog, we’ll discuss the three best practices for your annual retirement plan review and what the focus of these meetings should include.
The IRS announced on November 6, that several contribution limits in qualified retirement plans will increase next year.
These limits cover cost of living adjustments to a variety of retirement plan limitations. The chart below provides a summary of the amounts for your convenience.Read More
Many plan sponsors create oversight committees for their qualified retirement plans. These committees are frequently called “investment committees,” “administrative committees,” or, simply, “retirement plan committees.” The duties of these committees are significant, and will typically include:Read More
Topics: Benefit Plan Advising & Auditing
The U.S. Department of Labor (DOL) has released a final rule which should make it easier for smaller businesses to provide retirement plans to their employees. According to the DOL, the rule will enable more small and midsize unrelated businesses to join forces in multiple employer plans (MEPs) that provide their employees a defined contribution plan such as a 401(k) plan or a SIMPLE IRA plan. Certain self-employed individuals also can participate in MEPs.
In October 2018, the DOL issued a proposed rule to clarify when an employer group or association, or a professional employer organization (PEO), can sponsor a MEP. (A PEO is a company that contractually assumes some human resource responsibilities for its employer clients.) The final rule, effective September 30, 2019, is similar to the proposal, but not entirely.Read More
A cash balance plan is a qualified employee benefit plan which allows participants to accumulate retirement funds through company contributions and interest credits. A cash balance plan provides for a company contribution either in the form of a flat dollar amount or a percentage of pay and for a guaranteed interest component.Read More
At this point, you've already put some thought into implementing an ESOP and feel that it could be a viable option for you as you enter into a succession plan. When making your final decision, however, there are a few things about the ESOP process you as a business owner should be sure not to overlook.Read More
Topics: Benefit Plan Advising & Auditing
Internal controls are essential to maintain the trust of employees in regard to their benefit plans. However, implementing strong control systems is a complex undertaking. The Department of Labor (DOL) and the Internal Revenue Service (IRS) are just two government agencies keeping track of internal controls on employee benefit plans.
The DOL and the IRS have offered indications that they are more favorably inclined towards plans which have clear sets of internal controls governing them. This has been supported by presentations given at professional conferences and DOL courses. Employee benefit plans examination processes are usually faster and more efficient when a clear set of internal controls are already in place.Read More
An ESOP is an employee stock ownership plan that is essentially a retirement plan which helps employees obtain ownership in the company. But why should you care? Well, ESOPs can be great options if you are a privately-held business owner considering succession planning. You have a few options available to you:
Family Business Succession Planning
If you are a family-owned business, you might have your family already in place to take over the company. In this case, ESOPs are generally not the right fit.Read More
Inherent in any successful benefits strategy is awareness and action regarding the regulatory environment surrounding your employer-sponsored plans. Below, we have compiled a few reminders of upcoming regulatory deadlines:
All deadlines below assume a calendar plan year-end:
First Quarter 2019 (and beyond): Helpful Hints to Navigate
February 14: The Department of Labor’s regulations on fee disclosure include a requirement to issue certain disclosures to participants/beneficiaries by 45 days after each quarter-end for participant-directed DC plans.
o This disclosure is required for all participants with an account balance as of the end of the quarter.
o It is likely that your TPA handles this quarterly disclosure for you. However, this is a good opportunity to monitor the process in place at your TPA to ensure that these disclosures are being mailed out to participants in a timely manner.
Note: The DOL is continuing their scrutiny of compliance with these regulations and your fiduciary responsibility does not stop at assigning this task to your TPA, so be sure to maintain due diligence with this process!Read More
As of 2018, the National Center for Employee Ownership (NCEO) estimates there are almost 7,000 employee stock ownership plans (ESOPs) covering more than 14 million employees.Read More