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Department of Labor And IRS Issues
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Complete Section >>
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Congressional Committee Hears 401(k) Fee Disclosure Testimony
- 3/6/2007 |
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TRANSPARENT "CEDE." A Congressional hearing addressed Tuesday whether fees paid by 401(k) participants take too big a chunk out of workers'retirement savings and whether those fees should be more completely disclosed to individual investors. Representative George Miller (D-California) asked the House Education and Labor Committee to consider whether employers should be forced to give workers a clearer understanding of the fees they are paying and to explore whether the fees are carving too big a lump out of retirement savings. In his opening remarks to the committee, Miller said that workers are "simply not in a position to compare plans" and that improving "401(k) transparency is just the beginning of our efforts to ensure that all American have access to a secure retirement." However, Miller was countered by Representative Howard "Buck" McKeon, (R-California), who warned in his statement that forcing fee disclosure should be approached with caution. MORE
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Rollovers to IRAs Now Possible for Plan Beneficiaries
- 1/30/2007 |
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Summary: Notice 2007-7 includes guidance on the new rules allowing beneficiaries, other than surviving spouses, to make rollovers of plan distributions from qualified plans to IRAs. These rules became effective January 1, 2007.
Located at: BNAtax.com. Click on headline for full article.
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Fiduciary Issues
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Complete Section >>
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U.S. Department of Labor announces final rule on default investment alternatives for participant-directed plans
- 10/23/2007 |
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Summary: U.S. Secretary of Labor Elaine L. Chao unveiled a final rule establishing qualified default investment alternatives, making it easier for employers to automatically enroll workers in their 401k and other defined-contribution plans. Located at: U.S. Department of Labor. Click on headline for full article.
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U.S. Supreme Court Agrees to Hear Key 401(k) Fiduciary Breach Case
- 6/19/2007 |
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In a closely watched case that could settle a key area of pension law affecting 401(k) plans, the U.S. Supreme Court will decide whether participants can sue to restore their account balances when a fiduciary breach caused them to lose money. Monday's decision means the high court could shape participants' power to remedy situations where they charge an Employee Retirement Income Security Act (ERISA) fiduciary breach caused their 401(k) balance to fall below what it would have been without the breach. Earlier this year, justices asked the U.S. Solicitor General for input on whether ERISA Section 502(a)(3) permits a participant to sue to recover funds the participant says were lost when his or her account was mishandled. "It makes little sense that plans and their participants should be left with no relief when plan assets are lost through fiduciary mismanagement," U.S. Solicitor General Paul Clement responded in legal briefs filed with the court. Located At: Plansponsor.com
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General Issues
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Complete Section >>
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Ways and Means Hears Testimony on Appropriateness of Plan Fees
- 10/30/2007 |
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The House Committee on Ways and Means held a hearing October 30 to determine whether workers’ retirement savings are being eroded by excessive and unnecessary administrative and investment fees assessed by pension plan providers. Located at: Plan Sponsor.com. Click on headline for full article.
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Midsize firms adopting 401(k) automatic features as the right thing to do
- 10/25/2007 |
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Summary: As the use of auto-enrollment continues to grow, a fresh rationale for adopting auto-enrollment has emerged among midsize employers. Located at: Employee Benefit News (free registration may be required). Click on headline for full article.
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Technical Tips
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Complete Section >>
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401(k) Plans Take On Pension Plan Design Features
- 7/14/2005 |
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Excerpt: "Vendors are adding features that make 401(k)s plans appear more like traditional pension plans in order to address the fact that most people aren't professional fund managers, while not overextending the sponsors' financial obligations. Much of this is through automation: vendors and sponsors are increasingly creating plans in which participants do not have to make investment decisions and are guaranteed a stream of income in retirement." (Defined Contribution News)
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The Influence of Automatic Enrollment, Catch-Up, and IRA Contributions on 401(k) Accumulations (PDF)
- 7/13/2005 |
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28 pages. Excerpt: "The Employee Benefit Research Institute (EBRI) and the Investment Company Institute (ICI) have collaborated to develop the EBRI/ICI 401(k) Accumulation Projection Model. This model examines how401(k) assets might contribute to retirement income for future retirees based on decisions workers make throughout their careers and finds that the median replacement rate from 401(k) accumulations depends primarily on whether current participants will continue to work for ...." (Employee Benefit Research Institute)
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The Mutual Fund Inquiries
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Complete Section >>
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The Mutual Fund Trading Scandals: Implications for CPAs and Their Clients
- 12/1/2004 |
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Summary: Scandals have changed the way mutual funds operate. In this article the special counsel to the SEC explains how the mutual fund industry got into trouble and the new rules designed to curb future abuses. Good reading for CPAs who offer investment advice. Located at: Journal of Accountancy at AICPA.org. Click on headline for full article.
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