IRS Issues
How are 403b loan defaults processed? Once a participant defaults on a loan, it’s a deemed distribution and a 1099R is created. But there are many other matters to be settled. In this week’s Tech Talk, Ellie Lowder tells us what happens regarding the participant’s account, the outstanding loan,...
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There are critical deadlines 403(b) plans must meet in order to stay in compliance with the federal Internal Revenue Code. Adding to the complexity of this function, some deadlines only apply to particular plan types (such as ERISA plans). In this week’s MarketBeat, Mike Webb provides a 403(b) Plan...
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The consultant for a 501(c)(3) that sponsors a 403(b) plan and a 401(a) plan has told the employer that the Code Section 415(c) limit is a shared limit between the two plans. In this week’s Tech Talk, Ellie Lowder tells us whether the consultant is correct.
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An employer wants to establish a top hat plan for its directors. How does it do that? In this week’s Tech Talk, Ellie Lowder identifies three steps.
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The Internal Revenue Service is reminding low- and moderate-income workers about an opportunity to earn a special tax credit while they save for retirement. The IRS notes that the Saver’s Credit helps offset part of the first $2,000 that workers voluntarily contribute to IRAs and 401(k) plans and...
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Two new efforts have been launched to increase the availability to retirement planning services to public-sector and non-profit employees. ABMM Financial, an investment firm based in Iselin, N.J., has been launched, and the Legend Group has announced a partnership with the Association of Christian...
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The IRS issued a clarification Nov. 10 on the application of the one-per-year limit on IRA rollovers. In Announcement 2014-32, the IRS said it had received comments about the “administrative challenges presented by the Bobrow interpretation of §408(d)(3)(B).” In the announcement the IRS...
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Plans interested in providing lifetime income alternatives via target-date funds that include deferred annuities just got some much-needed clarity from the IRS. In Notice 2014-66, the IRS provides a special rule that enables qualified defined contribution plans to provide lifetime income by...
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The IRS and Social Security Administration have issued their cost-of-living adjustments relevant to retirement benefits for 2015. IRS Limits The IRS on Oct. 23 announced COLAs affecting dollar limitations for pension plans and other retirement-related items for tax year 2015. Some of the limits...
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Prospects for state and local employees’ financial security in retirement are better than that of their private-sector counterparts, according to a new paper from the National Association of Government Defined Contribution Administrators (NAGDCA). Nonetheless, the paper argues, steps still...
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The IRS on July 11 announced that it is withdrawing a proposal it made in 1981 for an amendment to regulations governing IRA rollovers. The proposed amendment to Treas. Reg. § 1.408-4(b)(4)(ii) would have applied the rollover limitation on an IRA-by-IRA basis. This withdrawal affects individuals...
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The Treasury Department issued a rule July 1 that essentially allows employees to convert part of their IRA or 401(k) balances into a longevity annuity. Under the rule, an IRA or 401(k) can allow participants to use $125,000 or up to 25 percent of their IRA or 401(k) — whichever is less — to buy a...
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The federal government, a purveyor of regulations and legislation, has set before the 403(b) community a veritable blue plate special — and one with a long shelf life to boot. NTSA President Susan Diehl of PenServ Services, Inc., outlined what’s on that plate at NTSA’s 403(b) Summit in Washington,...
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The watchword of the day is patience. And detailed preparation. Speaking to a packed room at a June 23 general session of the NTSA 403(b) Summit in Washington, D.C., Kristi Cook, head of an eponymous law firm, and Ellie Lowder, of TSA Consulting, outlined the challenges facing the 403(b) industry...
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The U.S. Supreme Court issued its decision in U.S. v. Windsor — in which it said that retirement plans must treat a same-sex spouse just they would any other spouse for purposes of benefits under the retirement plan — one year ago, on June 26, 2013. That makes this an opportune time for Ellie...
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Have you made a mistake in administering your 403(b) plan? Does this mistake put you at risk of IRS action? If so, you are not alone — not only in the sense that others have made mistakes, but also because the IRS has updated its 403(b) Plan Fix-It Guide, a resource that tells plan sponsors how to...
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The IRS is auditing 403(b) plans — especially in light of the changes made to the 403(b) regulations in the last few years. In the latest Market Beat, Kimberly A. Flett points out that with the right amount of planning and proper administration, plan sponsors can avoid audit pitfalls and provide...
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It’s now easier for plan sponsors and employers to participate in the 403(b) pre-approved plan program. April 14 was the effective date of IRS Revenue Procedure (Rev. Proc.) 2014-28. The new guidance modifies guidance the IRS issued last year, Rev. Proc. 2013-22, to make it easier for a person to...
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New guidance from the IRS may make the plan-to-plan rollover process a little smoother. Revenue Ruling 2014-9, issued on April 3, is intended to make it easier for plan participants to consolidate their retirement savings accounts by making it easier for them to move assets from one employer plan...
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The IRS, in Notice 2014-19 and related FAQs, says clearly that retirement plans — including 403(b) plans — have to recognize same-gender spouses and spells out how. The notice and FAQs, which the IRS issued April 4, are a follow-up on Revenue Ruling (Rev. Rul.) 2013-17, which provided general...
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