Benefit Plan Sponsors

News & Analysis as of

Are Your Beneficiary Designations Heir Tight?

An often-neglected area in the world of benefit plan administration is the beneficiary designation form. Many participants complete their beneficiary designations incorrectly because they don’t read the instructions carefully...more

Righting a Wrong: The “Claim of Right” Doctrine and Other Tax Considerations for the Repayment of Pension Plan Overpayments

Pension plan overpayments to participants and their beneficiaries are an all-too-common occurrence. When overpayments occur, a plan administrator’s duties are fairly clear. Typically, the plan administrator must seek...more

The Reckless Fiduciary: When Are Imprudent U.S. Fiduciaries Liable For Plan Losses?

“A pure heart and an empty head are not enough.” This is a quote from an early case defining the scope of ERISA fiduciary liability. However, ERISA has always made fiduciaries responsible only for losses caused by their...more

The Small Things that Create the Biggest Problems for 401(k) Plan Sponsors

“For Want of a Nail” is a proverbial rhyme that shows that the smallest of action can have huge consequences later down the line, just like a snowball effect “For want of a nail the shoe was lost. For want of a shoe the horse...more

Accepting Rollover Contributions Now Easier - and Less Risky - For Retirement Plans

The administrative burden of determining the validity of rollover contributions to qualified retirement plans, and the associated risk of jeopardizing the plan’s tax-qualified status, traditionally has been a significant...more

Fiduciary Notice Obligations Associated with Change of Carriers

This case discusses the fiduciary obligation of plan administrators to inform participants in advance of ERISA’s statutory notice periods regarding the potential impact caused by a change of life insurance carrier under a...more

Five New IRS Private Letter Rulings Confirm IRS’s Position Allowing Retiree Cashouts

We reported in 2012 on two private letter rulings (“PLRs”) issued by the IRS (PLR 201228045 and PLR 201228051) blessing certain retiree cashout programs. A retiree cashout program is a de-risking strategy used by defined...more

Watch out for Biased and Paid Opinions/Studies

I would say that if that if you ask a retirement plan expert for their opinion, 3,000 experts will yield 5,000 opinions. It’s great to be opinionated, but for the plan sponsor, it can be a bit confusing....more

For 5 Basis Points More

Ever since I graduated school, I have gone to the same car mechanic for the past 16 years. Maybe Ralph is a couple of dollars more than someone else, but he’s always honest. He’s the type of businessman who shows that trust...more

Advisors Advantage - August 2014

Dealing with adversity. It's about how you deal with it. I'm a huge Aerosmith fan since high school and it's because the music resonates with me because it reminds me of the experiences that I have gone through...more

Mitigating Longevity Risk in DC Plans

401(k) participants face the risk of outliving retirement assets. However, earlier this month, the Internal Revenue Service and the Treasury Department issued final regulations that make it easier for 401(k) plans, individual...more

The Rosenbaum Law Firm Review - July 2014

Plan Sponsor Should Avoid These Retirement Plan Provider "Con Games". Scams you should watch out for. The George Clooney-Brad Pitt trilogy of heist films known as Ocean's Eleven, Ocean's Twelve, and Ocean's...more

Revenue Sharing is becoming the 401(k) Leisure Suit

When I was a child, I remember bringing the soundtrack to Saturday Night Fever for my first grade class’ Chanukah party (I went to a Jewish day school). To this day, I still don’t how to operate a record player. Around the...more

Plan Sponsor Should Avoid These Retirement Plan Provider “Con Games”

The George Clooney-Brad Pitt trilogy of heist films known as Ocean’s Eleven, Ocean’s Twelve, and Ocean’s Thirteen were remembered for their twist endings, stylish pacing, and lightheartedness. Since the Ocean gang were...more

It’s always the Plan Sponsor’s fault

Seven years ago, I was asked to look at a $25 million 401(k) plan that was in complete disarray and I was flabbergasted because it belonged to a law firm that claimed to have an ERISA practice. There was no financial advisor...more

July and August 2014 Filing and Notice Deadlines for Qualified Retirement and Health and Welfare Plans

Employers and plan sponsors must comply with numerous filing and notice deadlines for their retirement and health and welfare plans. Failure to comply with these deadlines can result in costly penalties and excise taxes. To...more

PBGC Supports Lifetime Income

The Pension Benefit Guaranty Corporation (PBGC) recently issued a proposed regulation designed to encourage participants in defined contribution plans (e.g., 401(k) plans) to roll over their account balances to their...more

De Facto Plan Administrator Claims in the First Circuit

According to 29 U.S.C. § 1132(c)(1)(B) of ERISA, it is within a court’s discretion to award a penalty of up to $110 per day based on an administrator’s failure to comply with a plan participant’s or beneficiary’s request for...more

Plan Sponsors Should Avoid Using Their Payroll Provider as Their 401(k) TPA

I stick to what I know, so I venture very little outside the retirement plan space. I do that because I believe it is less likely to cause trouble. The two largest payroll providers don’t follow that philosophy -- they are...more

Advisors Advantage - July 2014

If they made the poor Plan decisions, they may take offense on your criticism. They will take offense. Two years ago, I had the worst call with a prospective client in the 14 years I have been an ERISA attorney...more

Yeah, I know, Everyone does it

I was never part of the in crowd. Look at my picture, could I ever be in the “in crowd”? I’m always the odd one out, that’s why I dressed up as the Rodney Dangerfield character, Al Czervik from Caddyshack on Halloween. While...more

The Law Firm Review

Plan Sponsors' Misconceptions About Retirement Plan Fee Disclosure. There are many. To me, there is no greater television show than Seinfeld because it's timeless and there is something about each episode that...more

A 401(k) Financial Advisor Shouldn’t Refer a TPA Just Because They’re Cheap

Animal Farm by George Orwell was a clever allegory of the Bolshevik Revolution and the Soviet Union where the oppressed animals overthrew Farmer Mr. Jones, only to start oppress- ing each other. A similar situation is when I...more

Some Plan Sponsors will cut their nose to spite their face

I used to spend much time trying to explain irrational behavior through rational thought and it’s really impossible. If you’re a plan provider, don’t waste your time doing that. There are some plan sponsors out there...more

Bottom Line: This is what Retirement Plan Sponsors Need To Do

My great Uncle Jack Urbinder passed away a few weeks back at age 88. He was my Grand- mother’s only brother (out of 3) who survived the Holocaust. Much like my grandmother, Uncle Jack was genuine and he told it as he saw it....more

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