Employers sometimes ask if they can reward their more tenured employees by providing them with a more generous matching formula than their less tenured counterparts.
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The IRS issued Notice 2022-33, which extends the deadline for amendments to retirement plans and Individual Retirement Arrangements (IRAs) to adopt provisions enacted under the SECURE Act, the Miners Act, and some provisions under the CARES Act.
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A 401(k) is one of the most common qualified retirement plans offered by employers to help their employees save for their retirement. While many employees take advantage of this important benefit, many may not understand that they have a choice in the type of contribution they make—and the mechanics of how their contribution is taxed.
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Many plan sponsors believe that the availability of loans in retirement plans is an attractive feature. Specifically, participants are more likely to contribute to a plan if they know that they can access a portion of their plan assets while they are still employed—without having to suffer the accompanying tax consequences.
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The Davis-Bacon Act (DBA) has played a major role in the construction industry for over 90 years. Passed in 1931, it has been described by the Supreme Court as a “minimum wage law designed for the benefit of construction workers.” The DOL has issued proposed regulations that represent the most comprehensive changes to the DBA since 1982.
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It has been 20 years since the IRS last made regulatory changes for required minimum distributions (RMDs). Today, we have proposed RMD regulations. But we also have many new questions that affect the plan administration of RMDs.
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Many defined contribution qualified plans, such as 401(k) plans, allow employers to make a matching contribution. Providing a match may encourage employees to make elective deferral contributions to the plan. There are several guidelines that may affect when matching contributions should be made.
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In the May 23, 2022, issue of Employee Plans News, the IRS explains the applicability of the Employee Plans Compliance Resolution System (EPCRS) for pre-approved plans that are not restated by appropriate deadlines.
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Employers of all types have expressed interest in learning more about multiple employer plans (MEPs). But the unified plan rule, sometimes known as the “one bad apple rule,” has discouraged some employers from pursuing MEP participation. This rule treats a qualification failure by one participating employer as a MEP disqualification event for all employers maintaining the plan. To help expand access to MEPs, the IRS has released proposed regulations, which provide a welcome exception to the unified plan rule. The proposed regulations also withdraw prior proposed regulations that were originally issued in July 2019.
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Individuals may simultaneously convert Traditional IRA assets and roll over pretax 401(k) plan assets to a Roth IRA. The transactions are relatively straightforward from a compliance perspective. Neither are subject to income restrictions or the one-per-12-month rollover rule. Both types of transactions can be done directly, which eliminates concerns over the 60-day rule.
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Some exceptions apply universally across both qualified retirement plans (QRPs) and individual retirement accounts (IRAs). Some exceptions, however, are unique to QRPs and some are unique to IRAs.
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The IRS has issued a news release announcing the postponement of certain tax-related deadlines for victims of wildfires and straight-line winds in New Mexico.
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There are three main types of correction programs under the IRS, collectively referred to as the Employee Plans Compliance Resolution System (EPCRS). These include the Self-Correction Program (SCP), Voluntary Correction Program (VCP), and Correction on Audit Program (Audit CAP).
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The IRS issued a news release on April 1, 2022, announcing the postponement of certain tax-related deadlines for victims of severe storms, flooding, and landslides in Puerto Rico.
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We have guidance regarding certain changes brought about by the SECURE Act. On February 23, 2022, the IRS released proposed regulations that revise the existing required minimum distribution (RMD) regulations and other related regulations.
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Plan sponsors should evaluate their plans for protected benefits when they make a discretionary amendment or when there is an acquisition or merger of plans.
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Final regulations entitled, Implement SECURE Act and Related Revisions to Employee Benefit Plan Annual Reporting on the Form 5500, issued by the Department of Labor’s Employee Benefits Security Administration (EBSA), have been received by the federal Office of Management and Budget (OMB).
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Nondeductible employee contributions, otherwise known as after-tax contributions, are available in qualified plans like 401(k), 403(b), or money purchase pension plans. Depending on the plan design, individuals can increase their qualified plan Roth assets by making nondeductible contributions and then rolling over (i.e., converting) the assets to a designated Roth account within the plan.
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