On January 10, the IRS published proposed regulations. They provide guidance for retirement plans that allow participants who have attained at least a certain legally-specified age to make additional elective deferrals (i.e., catch-up contributions). If allowed under certain plans such as 401(k) plans and 403(b) plans, participants can make catch-up contributions if they have contributed […]
On January 14, for the first time since 2006, the U.S. Department of Labor (“DOL”) published a restatement of its Voluntary Fiduciary Correction Program (“VFCP”). The VFCP is designed to encourage correction of certain fiduciary breaches by permitting persons to avoid potential DOL civil penalties, if they voluntarily correct eligible transactions in a manner that […]
Given the mobile workforce in this country, during its plan audits the DOL is focusing more on “missing participants.” Those are former employees who still have a vested plan account but who have not provided the employer or its service providers with their current mailing address. The IRS and the DOL have previously published guidance […]
Given the continuing wave of ERISA litigation, this article has become a mainstay of The Speed Reader. A sample of recent cases is provided below. The most common type of ERISA case involves retirement plan participants’ allegations that plan fiduciaries caused participants to pay excessive recordkeeping and investment fees and included one or more poorly-performing […]
On January 10, the IRS published proposed regulations providing guidance on several provisions of the SECURE 2.0 Act of 2022 (“SECURE 2.0”). First, under SECURE 2.0, certain 401(k) and 403(b) plans must include an automatic contribution feature, under which: Those provisions do not apply to 401(k) or 403(b) plans that were established before December 29, 2022, […]
On November 1, 2024, via Notice 2024-80, the IRS announced the effect of cost-of-living adjustments on certain 2025 dollar limits for various retirement plans (e.g., 401(k) plans and 403(b) plans). As expected, several limits will increase for 2025 because of inflation, as the increase in the cost-of-living index met statutory thresholds that triggered their adjustment […]
As the end of 2024 quickly approaches, retirement plan sponsors should promptly consider several important potential tasks. Examples include the following: The failure to comply with most of those requirements can be addressed under the IRS’s formal correction programs for retirement plans.
The following is a summary of cases for which courts have provided rulings, since last month’s edition of The Speed Reader was published. Walsh vs. Bicallis LLC (decided on September 25 by the U.S. District Court for the District of Maryland): During a 401(k) plan audit, the U.S. Department of Labor (the “DOL”) found that […]
As background, the so-called SECURE 1.0 Act provided that if a part-time employee who is at least 21 completes at least 500 hours of service for three consecutive years, the employee must be allowed to make elective deferrals to his or her employer’s 401(k) plan. The earliest entry date for such employees was January 1, […]
On August 23, the IRS published Private Letter Ruling 202434006 (the “PLR”). The applicant proposed to amend its 401(k) plan (the “401(k) Plan”), retiree health reimbursement arrangement (the “Retiree HRA”), educational assistance program (the “EAP”), and its Health Savings Accounts (“HSAs”) program. More specifically, the applicant proposed to amend those programs to allow eligible employees […]