Headlines about "Communication and disclosure to participants"
Gathered from the web by the editors at BenefitsLink.com.
[Guidance Overview] Estoppel in ERISA: Simple Mistakes Can Lead to Costly Litigation
"Even if the participant ultimately fails in proving the elements of estoppel, defending against such claims is costly and time-consuming. Accordingly, employers and plan administrators should take the following steps to protect themselves from these types of claims: . . . ." (Employee Benefits Law Report)
[Guidance Overview] Agencies Outline Plans for Issuing Rules Under Affordable Care Act
"[An] imminent final rule will establish the requirements of the Summary of Benefits and Coverage (SBC) disclosure that health insurers and group health plans must provide to consumers to enable them to better compare benefits and coverage. The CMS issued a proposed rule on this topic in August 2011. A final rule, which will also 'set standards for the definitions of terms used in health insurance coverage, including specific terms' provided in the Affordable Care Act, is expected to be issued shortly." (Employee Benefits Counsel Blog)
The Making of The 403(b) Model Disclosure Form
"These [403(b)] plan participants are not fiduciaries, and often do not have anyone to be able to collect and compare data on their behalf. They are sold investment products directly. So it really becomes a very simple issue for that school teacher or administrator: how much sales commissions is my investment generating; what services am I getting in return; is there a way for me to compare it all; and how can I reasonably access comparative data on the investments themselves?" (Business of Benefits, Robert J. Toth Jr.)
[Guidance Overview] Slide Presentation: Form W-2 Reporting Requirements for Employer-Sponsored Group Health Coverage (PDF)
"Overview: Informational nature of reporting requirement; Effective date; Special transition relief for small employers; Employers subject to the new rules; Plans that must be reported; Determination of the aggregate cost; [and] Open issues" (Crowell Moring via American Benefits Council)
Unraveling The Mystery of 401(k) Disclosures
"Sponsors will be required to present information about the investment options in the retirement plan in a chart that allows plan participants to compare fees and expenses . . . . Plan sponsors can use a model chart developed by the Labor Department or they can develop their own." (MarketWatch)
New Fee Disclosure Solution Released By NEA, NTSAA & ASPPA Joint 403(b) Taskforce
"Partners of the 403(b) Transparency Taskforce including the National Education Association (NEA), the National Tax Sheltered Accounts Association (NTSAA) and The American Society of Pension Professionals & Actuaries (ASPPA) today launched the 403(b) Model Disclosure Form -- the first ever transparency standards for disclosure of fees and services in the public school 403(b) marketplace." (American Society of Pension Professionals & Actuaries)
403(b) Model Disclosure Form (Jan. 2012)
"This form is designed to provide [you, a 403(b) plan participant,] with the ability to easily compare detailed information regarding the investment options available to you. It is designed to provide you with a snapshot of the critical information needed when selecting an investment, including the services to be provided to the participant, the fees to be charged to the participant, investment information, the commissions payable to the persons who provide services to the plan, and other payments to third parties." (ASBO, NEA & NTSAA Joint 403(b) Taskforce)
Guide to the 404a5 Opportunity for Retirement Advisors, Part I: Counseling Plan Participants
"Mark down May 31, 2012 in your calendar. That's the date by which 483,000 U.S. retirement plans must send to their participants the initial disclosures required by new Department of Labor rules under Section 404a5 of ERISA. . . . DOL estimates that the rule will affect 72 million active participants who hold $3 trillion of plan assets. . . . It is your job, and opportunity, to help them anticipate, interpret and act on information contained in 404a5 disclosures." (Benefits Pro)
[Guidance Overview] D.C. Requires Employers to Withhold D.C. Tax on Retirement Plan and IRA Distributions to D.C. Residents (PDF)
"Unlike withholding in some other jurisdictions, the D.C. legislation requires withholding from distributions from IRAs, as well as pension, profit sharing and tax sheltered annuities (403(b) plans); withholding is mandatory, not voluntary." (Saul Ewing LLP)
[Guidance Overview] Reminder of ISO and ESPP Reporting Deadlines
"This is a reminder to companies issuing incentive stock options and sponsoring employee stock purchase plans about the January 31 deadline to report certain information to participants and the February 28 deadline to file returns with the IRS." (McKenna Long & Aldridge LLP)
401(k) Plans Step into the Sunshine with New DOL Rules Requiring Fee Disclosures
"Analysts and companies in the industry say the increased disclosure will allow companies to negotiate better deals and employees to request more cost-efficient plans. Already, the prospect 'is putting downward pressure on fees,' said [the] leader of consulting firm Callan Associates Inc.'s defined-contribution practice." (The Wall Street Journal)
[Guidance Overview] Effective Date of DOL's Fee Disclosure Regulations Near: Plan Sponsors Should Not Procrastinate
"Plan sponsors should ensure that service providers are complying with their regulatory disclosure requirements. The steps to follow are (in some respects) similar to the participant fee disclosure steps . . . ." (Ice Miller LLP)
[Guidance Overview] Significant Compensation and Benefit Due Dates for 2012 (PDF)
"This Compliance Calendar assumes a plan administered on a calendar year basis by an employer with a calendar fiscal year." (Aon Hewitt)
How to Take Advantage of New 401(k) Fee Disclosures
"With this new information about the 401(k) fees you are paying, you will have an opportunity to reduce the costs of your retirement investments." (U.S. News & World Report LP)
Low-Cost Entries Shake Up Small Retirement Plan Market
"If you own a small business, the time to comparison-shop for 401k plans has never been better. Low-cost plans are cropping up, as new federal regulations kicking in this year call for greater disclosure of feeinformation to plan participants and sponsors." (Thomson Reuters)
It Pays to Understand Your 401(k) Plan Fees
"[T]his year, plans are scheduled to be required to begin issuing annual and quarterly statements with performance and fee information. You'll get a chart that lists each investment available in your 401(k), with a description of what it is." (Chicago Tribune)
[Guidance Overview] A Look at Case Law for Important Plan Documentation Reminders
"Two important cases provide good reminders to plan fiduciaries about (1) the importance of documentation of fiduciary processes, and (2) accurate communication of plan design changes to participants and beneficiaries." (Ice Miller LLP)
[Guidance Overview] 2012 Deadlines Approach to Furnish Incentive Stock Option and Employee Stock Purchase Plan Information Statements and Returns
"In addition to the employee information statements, corporations must file returns with the Internal Revenue Service on Forms 3921 and 3922 no later than February 28, 2012, if filed on paper, or April 2, 2012, if filed electronically." (DLA Piper)
[Guidance Overview] Fee Disclosure: A Detailed Overview for Plan Sponsors and Their Advisors (PDF)
"[This article] is a summary of the provisions of the new regulations and how plan sponsors and participants will be affected." (Sentinel Benefits & Financial Group)
[Guidance Overview] DOL's Proposed New Rules that Will Affect Multiple Employer Welfare Arrangements (PDF)
"The two areas of concern are: (1) the Secretary of Labor's ability to issue a cease and desist order or a summary seizure order; and (2) the reporting and disclosure requirements for MEWAs. The DOL has also proposed revisions to the Form 5500 and the Form M-1 for MEWAs." (Conrad Siegel Actuaries)
6 Critical Trends for Retirement Plans in 2012
"The six megatrends Lincoln Trust sees in 2012: New 401(k) Fee Disclosure Rules by DOL . . . 'C Suite' Sticker Shock' . . . A Refined Fiduciary Standard . . . Models vs. Target-Date Funds . . . The Rise of 401(k) Evaluation Services . . . A Call for Investment Expense Transparency." (AdvisorOne)
New Fee Disclosure Rules Help Make Costs More Transparent
"The regulations for calendar-year plans take effect 60 days after April 1, 2012, so most participants won't start receiving the new information until May 31, 2012. The DOL will now require your employer and any other provider to the plan (such as the plan's financial adviser and recordkeeper) to ensure the distribution of the following information to you: . . ." (The Smarter Investor (usnews.com))
[Guidance Overview] Labor Department Offers Guidance on Electronic Disclosure But Not Much Relief
"The Release provides little relief to plan administrators who want to satisfy the disclosure requirements of the Regulation electronically but are stymied by the cumbersome requirements of the Safe Harbor as to Group 2 participants. Inexplicably, however, Method 2 in the Release is more difficult to implement than the consent procedures in the Safe Harbor for Group 2 participants." (McGuireWoods LLP)
The Case for Re-Enrollment
"When TDFs are added to a plan's investment lineup, adoption rates as a percentage of plan assets range from 1% to 5%2 (incremental to assets mapped). With re-enrollment as the strategy? TDFs jump to a 40% to 60%2 adoption rate. For sponsors interested in better asset allocation for their participants, but unsure how to drive TDF adoption in the face of participant inertia, effective implementation is key." (JPMorgan Chase & Co)
[Opinion] The Case Against Basis Point Fees for All Services
"How does a plan fiduciary respond to participants who question the fees; particularly if it is a long-term employee that has likely taken a beating on returns over the past couple of years? Now they find out later that they are paying four times the amount that the plan deems reasonable for the services being provided. It could get ugly." (Smart401k)
[Guidance Overview] 2012 Reporting & Disclosure Calendar for Multiemployer Plans (PDF)
"The [calendar] summarizes compliance requirements for multiemployer plans." (The Segal Group, Inc.)
[Guidance Overview] New FAQ about Form 8955-SSA Clarifies Requirements for Answering 'Yes' to Question 8
"For those plan administrators who have not filed their Form 8955-SSA for the 2009 and 2010 plan years, this new FAQ . . . provides helpful clarification of the requirements for answering 'yes' to question 8 on the form, although it may come too late to allow some plan administrators to withhold information that is clearly no longer required." (Thomson Reuters/EBIA)
[Guidance Overview] Tax Reporting Deadline Rapidly Approaching for Incentive Stock Options and Employee Stock Purchase Rights
"While these filings are required only once per year, please note that each Form 3921/3922 may report only one transaction. As a result, employers may need to prepare multiple forms for a single employee." (Jones Day)
Five Areas 401k Plan Sponsors Must Address to Reduce Fiduciary Liability
"5. Trustee and Employee Education ? A well rounded plan with the perfect array of investment choices will die on the vine if the plan sponsor fails to provide adequate education for employees." (Fiduciary News)
The Impact of 408(b)(2) Disclosure Regulations on TPAs
"TPAs typically receive compensation for administrative services, often including a base fee and a per-participant fee, as well as fees for processing transactions (e.g., loans, QDROs, and distributions). Many TPAs also provide consulting services, for which they typically receive hourly fees. If the TPA doesn't receive any other compensation (such as revenue sharing or payments from other service providers), they may not have to do any additional disclosure in order to comply." (BenefitsPro)
[Guidance Overview] Notifying Terminated Participants of Deferred Retirement Benefits Reported on Form 8955-SSA
"The information may be included in a benefit statement or distribution package; a separate statement isn't required." (Mercer LLC)
[Guidance Overview] Sample Compliance Calendar for Retirement Plans (PDF)
"This calendar provides general key retirement plan compliance requirements common to most calendar year plans." (ERISAdiagnostics Inc.)
[Guidance Overview] Health & Welfare Plan Reporting and Disclosure Checklist (PDF)
"There are numerous reporting and disclosure requirements for Health & Welfare Plans. We have expanded and replace our previous chart containing only disclosure requirements to include reporting requirements." (ERISAdiagnostics, Inc.)
Scriveners' Errors, Drafting Errors, Operational Failures, Retroactive Amendments, Reformations, ERISA, and the Tax Qualification of Pension Plan Trusts
"There are often discrepancies between a pension plan's governing documents and the plan's operations . . . . Such a discrepancy if not corrected pursuant to the terms of the governing documents, is described as an operational failure . . . . This article offers suggestions by which the [IRS] may lessen the burden on itself and conscientious plan sponsors, while improving compliance with (1) the tax-qualification rules of Section 401(a) of the [IRC] and (2) the similar provisions of [ERISA]." (Social Science Research Network)
Best Practices for 403(b)s Subject to Fee Disclosure Rules
"[T]he NTSAA Fee Transparency Task Force is in the final stages of the development of a fee disclosure document patterned after the DoL model comparative fee chart. The document will be available for non‐ERISA employer plans in the belief that employers and participants will benefit from total transparency as they exercise their freedom to choose their own investment options, and financial advisers. It is expected that the Task Force will launch the new document in the first quarter of 2012." (PLANSPONSOR.COM)
Albert Feuer on Tax Qualification of Pension Plan Trusts
"According to Al: 'The article analyzes the significance of operational failures, i.e., cases in which the terms of a plan's governing documents are violated. The article offers suggestions how the [IRS] may lessen the burden on itself and conscientious plan sponsors and administrators, while improving compliance with (1) the Code's tax-qualification rules, and (2) the similar provisions of ERISA.'" (Workplace Prof Blog)
Collective Investment Trusts: An Investment Vehicle for 401(k) Plans?
"With the new [fee] transparency, some plan sponsors will probably start looking for lower-cost investment options, and CITs may fit the bill." (U.S. News & World Report LP)
[Guidance Overview] Update on Fiscal Year Health FSAs and the $2,500 Limit
"On January 10, 2011 I posted about how employers with health FSAs that follow a fiscal year might comply with the $2,500 deferral dollar limit going into effect on January 1, 2013. This post updates and corrects the earlier post as follows: Notice 2012-9, which provides updated guidance on Form W-2 reporting of the value of group health care, exempts most health FSAs from the reporting requirement. The specific exemption applies to health FSAs that are exempt from HIPAA because they are funded entirely by employee salary deferrals, or because any employer contribution is $500 or less." (E is for ERISA)
[Guidance Overview] IRS Clarification of Previous Guidance on Form W-2 Informational Reporting Requirement
"Employers should continue to work with payroll administrators to determine their level of preparedness to administer this new reporting requirement. Employers should determine which of their benefit arrangements must be reported so as to accurately capture the correct benefit values for the 2012 Forms W-2." (Proskauer Rose LLP)
[Guidance Overview] Updated Guidance on Form W-2 Reporting of Health Care Coverage
"Employers should review their benefit plans to determine which plans meet the definition of 'applicable employer-sponsored coverage.' For example, employers should consider whether their EAPs, wellness programs, or on-site medical clinics would be considered group health plans and, further, whether they should report such coverage (consideration also should be made as to whether COBRA should be offered for such programs)." (Morgan, Lewis & Bockius LLP)
[Guidance Overview] IRS Clarification of Form W-2 Reporting Obligations for Employer-Provided Health Coverage
"Although mandatory reporting on Form W-2 is a year away, the time for action is now. Employers should now (or very soon) begin discussions with their payroll departments (or outside payroll service providers) and create a schedule of what information is needed, who will provide it, and who will take the lead in overseeing all tasks, so that compliance with the reporting requirement does not slide to the end of the year, and become an overwhelming endeavor." (Davis Wright Tremaine LLP)
[Guidance Overview] Two New Cafeteria Plan Requirements Begin Affecting Plans in 2013
"Two new requirements apply to cafeteria plans in 2013 but plan administrators may need to start planning for these changes this year. The first is likely the most well-known: a new annual limit on employee contributions to health FSAs. The second may be more surprising: W-2 reporting of employer contributions to Health FSAs." (Wolters Kluwer Law & Business / ftwilliam.com)
[Guidance Overview] Service Provider and Participant Fee Disclosure Regulations: Effective Dates
"The participant fee disclosure regulations apply for plan years beginning after October 31, 2011. However, the deadline for the plan administrator of a covered plan to provide the initial annual plan, expense, or investment disclosures to participants is now 60 days after the later of: 1. The effective date of the 408(b)(2) regulations (i.e., April 1, 2012), or 2. The date the regulations apply (i.e., plan years beginning after October 31, 2011)." (SunGard Relius)
[Guidance Overview] 2012 Reporting & Disclosure Calendar for Benefit Plans (PDF)
Sibson Consulting's 2012 Reporting & Disclosure Calendar for Benefit Plans summarizes compliance requirements for qualified, single employer benefit plans. An interactive version of this calendar is available at http://www.sibson.com/publications-and-resources/rd-calendar/. (The Segal Group, Inc.)
[Guidance Overview] IRS Amends and Supplements 'Interim' Guidance on Form W-2 Reporting of Cost of Health Coverage
"As with Notice 2011-28, the new guidance and 'transition relief' apply with respect to 2012 Forms W-2, which generally must be furnished to employees in January 2013. Future guidance may limit the availability of some or all of the relief, but on a prospective basis only (applying no earlier than January 1 of the year that begins at least 6 months after the guidance is issued, and in no event applying to 2012 Forms W-2)." (Miller & Chevalier Chartered)
[Guidance Overview] IRS Guidance on Form W-2 Reporting of Health Care Coverage (PDF)
"As a follow-up to interim guidance issued last year, the IRS provided additional clarifications to assist employers in complying with the W-2 reporting requirements. This new guidance applies to W-2 reporting for 2012." (Buck Consultants, LLC)
[Guidance Overview] IRS FAQs on Notice to Terminated Participants with Deferred Vested Benefits Reported on the New Form 8955-SSA
"Plan administrators should review the materials previously distributed to terminated vested participants for the 2009 and 2010 plan years to confirm whether a separate notice should be provided to the affected participants by the January 17, 2012, deadline for calendar year plans." (Ballard Spahr LLP)
[Official Guidance] IRS Retirement Plan FAQs Regarding Form 8955-SSA
"What are the requirements for answering 'yes' to question 8 on Form 8955-SSA? A plan administrator may answer 'yes' to question 8 if the required information was timely furnished to participants in other documentation such as benefit statements or distribution forms." (U.S. Internal Revenue Service)
[Guidance Overview] W-2 Reporting of Health Coverage Cost
"The temporary exemption for employers that filed fewer than 250 W-2s for the preceding calendar year is still in place, until further notice." (Perkins Coie LLP)
Broker-Dealers Up in Arms 401(k) Fee Disclosure
"The issue: the proposed rules will require brokers to report how much they are paid to distribute mutual funds through brokerage windows. The trouble, brokers say, is that they offer thousands of mutual funds from hundreds of companies and often have different fee structures for each one." (Reuters)
[Guidance Overview] IRS Notice 2012-9 Modifies Form W-2 Reporting on Group Health Plan Coverage
"The Notice clarifies that the cost of coverage that is includible in the income of a highly compensated individual under Code ? 105(h) -- or payments or reimbursements of health insurance premiums that are includible in the income of a two percent (2%) shareholder-employee of an S corporation -- are not included in the aggregate reportable cost." (Deloitte via BenefitsLink.com)
[Guidance Overview] Form W-2 Information Reporting of Health Care Costs (PDF)
"Employers may now want to review that their payroll providers have taken appropriate steps to prepare for this new obligation. Failure to comply can result in a penalty of $200 per Form W-2, up to a maximum of $3 million." (Reinhart)
[Guidance Overview] San Francisco Health Care Security Ordinance: New Notice Obligations
Free recorded 2-hour webcast. Topics include: [i] Overview of the San Francisco Health Care Security Ordinance requirements and enforcement; [ii] New notice obligations and surcharge rules; [iii] Administering the 'rolling 24-month carryover' and other HRA requirements; [iv] Compliance options and plan designs that work with federal health care reform; [v] Possibility of ERISA preemption. (Nixon Peabody)
[Opinion] The SPARK Institute Letter to DOL re: Delay of 408(b)(2) Regulations (PDF)
"Some record keepers have already built fee summaries and have initiated rollout of their new 408(b)(2) materials. Any change to the interim final rules is likely to require systems and coding changes, as well as changes to processes, procedures, documents and communications for the vast majority of record keepers." (The SPARK Institute)
[Opinion] The SPARK Institute Follow-Up Letter on Delayed Release of Final 408(b)(2) Regulations (PDF)
"Since the final regulations have not yet been released, the vast majority of record keepers have indicated that they will not be able to comply with the regulations by April 1, 2012. Even if the final regulations are unchanged from the interim final regulations, recordkeepers no longer have enough time to complete planned communications and distribute the required disclosures to their customers." (The SPARK Institute)
[Guidance Overview] IRS Guidance on Mandatory Reporting of Value of Health Coverage on 2012 Forms W-2
"Importantly, health coverage is treated as applicable employer-sponsored coverage without regard to whether the employer or the employee pays for the coverage, or whether or not the value of the coverage is includible in the employee's income." (PricewaterhouseCoopers LLP)
Retirement Fund Fees May Get Squeezed by 401(k) Disclosure Rules
"Some companies that offer 401(k) investment funds share fee revenue with firms that provide recordkeeping or brokers that sell retirement plans. The amount flowing between funds and their service partners may be more than $5 billion annually, according to BrightScope Inc., a San Diego-based firm that tracks 401(k) data. The Labor Department rules, which may still change, will give employers details on those transactions." (Bloomberg L.P.)
Health Reform Reporting Rule Clarified
"The latest guidance also reiterates numerous provisions in last year's guidance, including that the cost of coverage that is taxable to employees, such as for a child older than 26, must be reported on the W-2. It also reiterates that contributions employees make to flexible spending accounts are to be excluded from the health care cost figure." (Business Insurance)
[Guidance Overview] IRS Issues Revised Guidance on Form W-2 Health Coverage Reporting
"The revisions should help employers and advisors as they navigate the new reporting requirement, especially with respect to application of the requirement to EAPs, wellness programs, and on-site medical clinics. However, calculating the cost of coverage will continue to be a challenge, particularly for self-insured plans." (Thomson Reuters/EBIA)
[Opinion] New Regulation Targets Hidden Fees in 401 (k)
"The new rule is in response to numerous lawsuits filed by employees who learned after the fact that they were paying large hidden fees to investment firms managing their accounts. Under the new requirement, insurance companies, payroll services and to some extent mutual fund companies will no longer be able to hide their unconscionable fees to people participating in their retirement plans." (The Washington Post; free registration required)
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