One of the most unique, flexible, and underutilized investment platforms in the 401(a) marketplace is the insurance company variable “pooled separate account” (the “PSA”). It may be the least understood investment platform, being buried in group annuity contracts….Why they are worth a look is because of the current discussions on MEPs and their alternatives, and the growing popularity of collective trusts. (They) can give plans access to well-priced investments, along with access to large numbers of unrelated funds and fund managers, which otherwise would not be available to them.
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IRS’s New 401(k) Pre-Approved Document Rules Suggests a Path To Address 403(b) Document Challenges
One of the more difficult rules that the IRS has imposed on the 403(b) market in recent years is the complete ban on issuing determination letters on individually designed 403(b) plan documents, under any circumstance. But buried in Rev Proc 2017-41 is something we have been looking for in the 403(b) space, which actually would help alleviate some of the concerns document drafters have with these long-standing plans.
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DOL Advisory Opinion Demonstrates Structure for Bundling Plans
This Opinion demonstrates that the scale we seek is not exclusively the purview of the MEP. Vendors have the ability to safely “bundle administrative services” to the same effect of a MEP, provided that they have enough scale on their own to negotiate the sort of investment pricing and expert services which the market seeks.
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The SCOTUS’s Church Plan Ruling in Stapleton Affirms Both the QCCO’s and Non-QCCO’s Ability to Maintain ERISA Exempt 403(b) Plans
There are three kinds of 403(b) church plans: the plans of “steeple church”; those of the “Qualified Church Controlled Organizations” (or ”QCCO”, of which the K-12 parochial schools of a church are the best example); and of the “Non-Qualified Church Controlled Organization” (or “Non-QCCO”, of which church hospitals and universities are among the most common
Is Lifetime Income’s Future-and, Ultimately, That of Retirement Security- Through the IRA?
IRAs, for whatever reason, are stealthily changing the retirement future. When you look closely at their structures, they can be designed to be incredibly flexible (though often “off-the-shelf” IRAs are not). There are a number of major “houses” which provide the technical and legal support for “plug and play” investment arrangements (though, admittedly, there are a few SEC rules which need to be changed to make them really work well). They provide a personal platform through which retirees can consolidate their assets in a way which can better serve their retirement in ways an employer sponsored DC or DB plan cannot.
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The Most Effective Proposed MEP Legislation Happens Not To Be MEP Legislation
This legislation could fundamentally change the MEP landscape, and even lessen the contention over state run MEPs. It would do this by opening the market for the advantageously pooling of the resources of small employers which would have otherwise been reserved to the State programs. It also could minimize any need for new federal MEP legislation, and promote models which are a lot less risky than the MEP.
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Managing Critical 403(b) Issues through Proper Allocation of 3(16) and 3(21) Fiduciary Responsibility
The complex nature of handling 403(b) plans-and, in particular, the unique manner in which the fiduciary rules apply to them-make these plans uniquely suited to customized fiduciary services. It is well beyond the skill set of many 501(c)(3) organizations to make sense of their often complicated 403(b) programs, and to put them into some kind of sensical order. This must be done all the while applying a number of rules intended for the 401(k) market (with their centralized recordkeeping systems) in a plan which may have significant assets held by multiple vendors under a variety of contracts with differing terms.
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ERISA and Mom: Sláinte!!
We have done this post a number of years in the past as an “Almost Annual Mother’s Day” piece; our attempt to put a very personal twist to the things we do, with a larger and hopeful light on many of the mundane tasks that make up much of our business. We now post it
403(b)’s “Limitation Year” Rules Demonstrate their “Individual” Nature-and Their Potential Value of the Universal Platform of the Future
The 403(b) limitation year is determined on a person by person basis, it is not a plan wide rule. Only the individual can change the limitation year, and only for its contracts. To change the year, the individual must attach a statement to his or her income tax return filed for the taxable year in which the change is made. To change a plan’s limitation year, the administrator would need each employee to make that 1040 filing.
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Correcting the “best guesses” on 403(b) Plan terms by using the first 403(b) Remedial Amendment Period under Rev Proc 2017-18
The IRS decided to handle this “best guess” period by announcing that any 403(b) document could be corrected under a new, special 403(b) Remedial Amendment Program, by that new RAP’s end date. It announced that the beginning of the RAP was the required adoption date for 403(b) plan documents (generally, January 1, 2010). The end of the RAP would be announced once the IRS approves its first set of pre-approved 403(b) documents. Once those first pre-approved documents are released, the IRS promised to announce the “end date.” It has now done that, with Rev Proc 2017-18 announcement of March 31, 2020 as the end of the RAP-which also suggest that the pre-approved documents will be released by that date.
Continue Reading Correcting the “best guesses” on 403(b) Plan terms by using the first 403(b) Remedial Amendment Period under Rev Proc 2017-18