News & Analysis as of

Employee Benefits Loans

Husch Blackwell LLP

Anatomy of an ESOP

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ESOPs can pay fair market value for the stock: Stock purchased by an ESOP must be appraised by an independent third party expert working with a trustee for the ESOP who must also be independent from the seller. The ESOP is...more

WilmerHale

Commonly Considered Option Program Enhancements: Part IV - Employee Loans To Purchase Shares

WilmerHale on

Consider this fairly typical situation. Four years ago, employee Emma was granted an incentive stock option (ISO) to purchase 100,000 shares with an exercise price of $0.86 per share. Emma’s award is fully-vested and she...more

Groom Law Group, Chartered

Small Business Administration Guidance Streamlines Process for Loans to ESOPs

In August of 2018, the Main Street Employee Ownership Act (“MSEOA”) became law as part of the John S. McCain National Defense Authorization Act. The intent behind the MSEOA was to promote the establishment of employee stock...more

Ary Rosenbaum - The Rosenbaum Law Firm P.C.

Loans and hardships are on the downswing

Bank of America’s newest survey shows that at the end of 2022, fewer participants took hardship withdrawals and loans. Participants taking a hardship distribution declined in the fourth quarter of 2022, with the average at...more

A&O Shearman

Pensions: what’s new this week - January 2023 #3

A&O Shearman on

Welcome to your weekly update from the Allen & Overy Pensions team, covering all the latest legal and regulatory developments in the world of workplace pensions. - This week we cover topics including: Tribunal: employer...more

Pullman & Comley - Labor, Employment and...

Mortgage or other Third Party Loan Investments in Your Plan?  Do they Pass Muster under IRS Issue Snapshot?

The IRS Issue Snapshot-Third Party Loans from Plans dated August 23, 2022 is a short advice document for examiners to use when auditing tax-qualified retirement plans that invest in mortgages or other third party loans. IRS...more

Holland & Knight LLP

Mexico Will Regulate Employer-Deducted Payroll Loans

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Mexico will regulate payroll loan agreements with automatic employer deduction. To this end, on Feb. 18, 2021, the Mexican Senate approved a bill in order to reform provisions under the General Law of Negotiable Instruments...more

Nelson Mullins Riley & Scarborough LLP

New Year, New COVID-19 Relief for Employers and Plan Sponsors (Part 2)

The Consolidated Appropriations Act, 2021, H.R. 133 (the “CAA”) signed into law by the President on Dec. 27, 2020 and a variety of IRS guidance issued in the first week of 2021 mean that employers entering the new year have...more

Butler Snow LLP

CARES Act – Retirement Plan Distribution and Loan Rules Liberalized

Butler Snow LLP on

With the economic fallout from the public health measures taken to mitigate the spread of the SARS-CoV-2 virus and COVID-19 disease, many employers have had to resort to unprecedented employment actions, including...more

Goodwin

COVID-19 Briefing – Germany Agrees to Unprecedented Package to Protect Businesses

Goodwin on

On 13 March 2020, the German government agreed on a far-reaching package of measures to protect companies and businesses in the German market. The central message is that the Federal State (Bund) and the provinces...more

Ballard Spahr LLP

CFPB continues to push the envelope in announcing settlement with brokers of pension advances

Ballard Spahr LLP on

The CFPB announced on August 14, 2019 that, subject to the approval of the Federal District Court for the Eastern District of Arkansas, the Bureau and the Arkansas Attorney General have entered into a proposed settlement with...more

Holland & Hart - Employers' Lawyers

Significant Expansion of IRS Self-Correction Program for Retirement Plan Errors

On April 19, 2019, the IRS issued Revenue Procedure 2019-19 (the “Revenue Procedure”), the latest update to and restatement of the Employee Plans Compliance Resolution System, its retirement plans correction program....more

McDermott Will & Emery

Changes in Executive Compensation

In a presentation at McDermott’s Employment and Employee Benefits Forum, Andrew Liazos discussed areas of focus for Section 162(m) and third-party loan funding for employee stock purchase plans (ESPPs). He also provided...more

Tucker Arensberg, P.C.

New Rollover Rules For Participant Loans Can Help With Corporate Transactions

Tucker Arensberg, P.C. on

When a company is sold and its retirement plan is terminated, an employee with an outstanding participant loan under the plan may have a problem. If the buyer and seller work together, the employee can be offered a choice to...more

Blank Rome LLP

2017 Tax Law Change Provides Relief to Workers with 401(K) Plan Loans Who Lose Their Jobs

Blank Rome LLP on

Increasingly, 401(k) plans have become the primary retirement savings vehicle for workers in U.S. private industry, and according to the Investment Company Institute, at the end of 2015, 87 percent of 401(k) plan participants...more

Eversheds Sutherland (US) LLP

IRS posts six more “issue snapshots” for retirement plans

Since 2016, the Internal Revenue Service Tax Exempt and Government Entities Division (TE/GE) has followed a practice of posting “issue snapshots” – technical summaries of tax issues provided for reference purposes – from time...more

Dickinson Wright

Common But Costly Mistakes in 401(k) Plan Loans

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Many 401(k) plans allow participants to borrow amounts from their vested 401(k) plan accounts and repay such amounts, typically through payroll deductions, back to their own accounts. Plan loans must comply with IRS rules...more

Maynard Nexsen

Employee Benefits and the Tax Cuts and Jobs Act

Maynard Nexsen on

As we move into the second quarter of 2018, now is a good time to remind employers about the significant impact of the Tax Cuts and Jobs Act (TCJA) on employee benefits. While some of these issues may not affect the taxation...more

Holland & Knight LLP

Tax Reform's Impact on 401(k) Plan Loan Offset Treatment - Actions for Plan Administrators and Human Resources Benefits Managers

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• The recent Tax Cuts and Jobs Act of 2017 (the Act), enacted on Dec. 22, 2017, contains a few rules that will impact benefit administrators. • This client alert focuses on changes made to the tax treatment of plan loan...more

Ary Rosenbaum - The Rosenbaum Law Firm P.C.

Relief for Hurricane Victims

Thanks to the damage caused by Hurricane Harvey and Hurricane Irma, the Internal Revenue Service (IRS), Department of Labor (DOL), and the Pension Benefit Guaranty Corporation (PBGC) have granted extensions of certain...more

Foley & Lardner LLP

401(k)/403(b) Loan Borrowers – Check Your Paystubs!

Foley & Lardner LLP on

A recent tax court case, Louelia Salomon Frias, v. Commissioner, TC Memo 2017-139, illustrates why it is good practice to verify that employee loan repayments have been timely deducted. Plan Loan Requirements. An employer...more

Carlton Fields

Retirement Plan and Leave Donation Programs During States of Emergencies

Carlton Fields on

This article should interest employers offering retirement plan benefits or leave donation programs to employees affected by Hurricanes Harvey and Irma, in particular, and in various states of emergencies, in general. It...more

Pillsbury Winthrop Shaw Pittman LLP

Internal Revenue Service Provides Helpful Relief to Hurricane Victims

Announcement 2017-11 (Announcement) provides that a tax-qualified employer retirement plan may treat a distribution to a current or former employee covered by the Announcement as on account of hardship or an unforeseeable...more

Bracewell LLP

Hurricane Harvey Relief for Employees

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Following Hurricane Harvey and its resulting destruction, many employees are in need of financial assistance and/or early access to retirement funds. We will highlight how employers can make direct financial assistance...more

McAfee & Taft

IRS announces special relief to help victims of Hurricane Harvey

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Last week the IRS announced that 401(k) plans and certain similar employer-sponsored retirement plans can make loans and hardship distributions to help victims of Hurricane Harvey....more

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