ARTICLES2017-12-21T17:54:10+00:00

ARTICLES    

 

Searching for Missing Participants and Beneficiaries in Ongoing Plans

March 2020|

  The payment of benefits to missing participants and beneficiaries has been an area of increased DOL attention in recent years. In 2019, the Employee Benefits Security Administration (a DOL agency) recovered over $2 billion in payments to plans, participants, and beneficiaries from enforcement actions.   Yet despite the DOL’s heightened enforcement activity, it has yet to publish guidance addressing how fiduciaries of ongoing plans can satisfy their fiduciary duty to locate missing [...]

LEGAL DEVELOPMENTS IMPACTING RETIREMENT PLANS – 2019 YEAR-END UPDATE

January 2020|

In December 2019, Congress passed the Setting Every Community Up for Retirement Enhancement Act (SECURE Act) as part of the Appropriations Act. See our article for additional information. Pursuant to an Executive Order, the IRS proposed updates to the actuarial tables for required minimum distributions (RMDs) to reflect longer life expectancies, resulting in lower RMD payments. The IRS finalized regulations on hardship distributions from 401(k) plans that implement changes in the 2018 Bipartisan [...]

LEGAL DEVELOPMENTS IMPACTING HEALTH AND WELFARE PLANS – 2019 YEAR-END UPDATE

January 2020|

In December 2019, the Fifth Circuit Court of AppealsTexas v. United States, 945 F.3d 355 (5th Cir. 2019), as revised (Dec. 20, 2019).  struck down the individual mandate penalty under the Affordable Care Act (ACA) for an individual who does not maintain qualifying health coverage. Although a federal judge in Texas found this conclusion invalidated the entire ACA, the Fifth Circuit was unconvinced. On January 21, 2020, the Supreme Court rejected a request for [...]

SECURE Act and the Further Consolidated Appropriations Act, 2020

January 2020|

  On December 20, 2019, President Trump signed into law the Further Consolidated Appropriations Act, 2020.Pub. L. No. 116-94, 133 Stat. 2,534 (2019). In citations, Division O of this law is hereinafter cited as the “SECURE Act.”   This law includes Division O, Setting Every Community Up for Retirement Enhancement (also known as the “SECURE Act”). Several provisions of the Act are described below. RETIREMENT PLANS Following the death of a defined contribution [...]

ARBITRATION IN ERISA PLANS FOLLOWING DORMAN V. SCHWAB

October 2019|

  Updated: December 2019 A recent Ninth Circuit decision has given plan sponsors a powerful new tool to limit plan-wide relief for fiduciary breach claims. Typically, plan participants can bring a claim in court for breach of fiduciary duty on their own behalf, as well as on behalf of the plan or a class of participants. Litigating these claims can be costly and time consuming. In response, some plan sponsors have amended their [...]

LEGAL DEVELOPMENTS IMPACTING HEALTH AND WELFARE PLANS 2018 YEAR-END UPDATE

February 2019|

The 2017 tax reform legislation eliminated the individual mandate penalty under the Affordable Care Act (ACA) for when an individual does not maintain health coverage.  Thereafter, several states sued the federal government, alleging that this change made the ACA unconstitutional, and the federal district court for the Northern District of Texas agreed in a December 2018 ruling. Texas v. United States, 340 F. Supp. 3d 579 (N.D. Tex. 2018). The court relied [...]

LEGAL DEVELOPMENTS IMPACTING RETIREMENT PLANS 2018 YEAR-END UPDATE

February 2019|

In October 2018, the DOL issued proposed regulations that would permit the establishment of association retirement plans.  The proposed regulations are similar to the DOL’s regulations permitting the establishment of association health plans that were finalized in June 2018.  As proposed, the regulations would be limited to defined contribution plans.  In 2014, the Supreme Court eliminated the presumption that employer stock is a prudent investment.  However, to sue retirement plan fiduciaries for employer stock [...]

LEGAL DEVELOPMENTS IMPACTING RETIREMENT PLANS 2017 YEAR-END UPDATE

February 2018|

In August 2017, a Ninth Circuit district court held a plan fiduciary violated its continuing duty to monitor plan investments under ERISA when it did not replace retail-class mutual funds with lower cost institutional-class funds. (This is the latest proceeding in the Tibble case, where the court held that an ERISA fiduciary has a continuing duty to monitor investments. The ruling effectively extends ERISA’s six-year statute of limitations so long as an investment [...]

LEGAL DEVELOPMENTS IMPACTING HEALTH AND WELFARE PLANS 2017 YEAR-END UPDATE

February 2018|

The Tax Cuts and Jobs Act was signed into law in December 2017. The Act eliminated the individual mandate of the Affordable Care Act (ACA) beginning in 2019. And so individuals will no longer owe a tax penalty for failure to have health coverage.  Also under the Act, employers can no longer deduct commuting and transportation benefits (e.g., parking, bus and train passes), but employees may continue to exclude them from income.  And [...]

CHANGES TO THE IRS DETERMINATION LETTER PROGRAM FOR INDIVIDUALLY DESIGNED PLANS

February 2018|

In 2015, the IRS announced a dramatic curtailment of its determination letter program for individually designed plans. Previously, plan sponsors were permitted to submit their plans for review by the IRS every five years in order to obtain a determination letter stating the plan was qualified under the tax code. If a plan timely adopted interim amendments during the remedial amendment cycle, then it would have until the end of the remedial amendment [...]