ERISA & Employee Benefits
QDRO’s From The Plan Administrator’s Perspective
A qualified domestic relations order (“QDRO”) is a state domestic relations order that assigns to an alternate payee (such as a former spouse or a child) the right to receive all or a portion of benefits payable to a plan participant. Specifically, under ERISA Section 206(d)(3)(B) and Internal Revenue Code Section 414(p)(1)(B), a QDRO is an order that “relates to the provision of child support, ...
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2021 Year-End Compliance Issues and Amendments for Retirement Plans
As the end of 2021 approaches, despite the current focus on proposed legislative infrastructure, spending, and tax packages, retirement plan sponsors should take time before year-end to review deadlines for required 2021 plan amendments and related compliance obligations. 401(k) plan hardship withdrawals – required amendment. The IRS issued regulations in 2019 liberalizing the hardship withdrawal rules. For example, participants no longer must take a plan ...
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SECURE Act 2.0 – Look Out for New Retirement Plan Incentives
On the heels of 2019’s SECURE Act (Setting Every Community Up for Retirement Enhancement Act), there currently is broad bipartisan congressional support for additional retirement plan legislation providing incentives to increase employees’ retirement savings. The House and Senate have drafted substantially similar bills which are working their way through the legislative process. Nicknamed “SECURE Act 2.0,” the provisions are expected to pass this year as ...
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New ERISA Guidance on Retirement Plan Cybersecurity
The Department of Labor (DOL) has just issued first-time retirement plan guidance to address cybersecurity risks for employers, plan fiduciaries, recordkeepers and plan participants. The guidance is in the form of recommended best practices to protect retirement benefits by providing strong cybersecurity practices for employers and plan service providers and online security tips for participants. The concern is that with millions of dollars accumulating in ...
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New Guidance Clarifies COVID-19 Employee Benefit Deadline Extensions
Last year the IRS and Department of Labor (DOL) extended various ERISA and COBRA deadlines for employee benefit plan participants affected by COVID-19. The extended deadlines included: The timeframe to elect COBRA continued health coverage; The deadline for making COBRA premium payments; Requests for special enrollment in a group health plan under HIPAA; The deadline for filing ERISA benefit claims and appeals; and The deadline ...
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COVID-19 and Retirement Plans – Partial Plan Termination Issues and New Fiduciary Relief
Potential Partial Termination of Retirement Plan. A partial retirement plan termination may occur when there is a significant reduction (generally more than 20%) in plan participation due to employer-initiated terminations or layoffs during the plan year. If a partial termination occurs, affected participants (those who are terminated) become 100% vested in their plan benefit, even if they have not yet satisfied the vesting schedule under ...
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COVID-19, the CARES Act and Retirement Plan Issues
The Coronavirus Aid, Relief and Economic Security Act (CARES Act) has a significant impact on employee benefit and retirement plans. The following summary highlights the changes. Suspension of required minimum distribution rules The required minimum distribution (RMD) rules for retirement plans, including 401(k) plans and IRAs, are waived for 2020. Therefore, plan participants who are over 70-1/2 do not have to take RMDs this year. ...
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