In an earlier post, we highlighted how the PBGC was rejecting a number of 2009 pension insurance premium filings because plan sponsors had completed the forms incorrectly. New rules effective in 2009 allow plan sponsors to make an election to use an Alternative Premium Funding Target (APFT) instead of the Standard Method. Many plan sponsors […]Read More… from PBGC APFT Relief
We’ve had a couple of initial posts on the new Early Retiree Reinsurance Program (ERRP): the first one gave a quick overview of the amount of funds available, while the second post described options for spending the reimbursement. In this post, I’d like to give a quick overview of some actions plan sponsors can take […]Read More… from Preparing to Apply for the ERRP Subsidy
We’ve been blogging lately on technical cash balance plan topics like meaningful benefits and fixing test failures. But we’ve been light on basics. You can see a basic cash balance plan explanation on our website: what they are, when they’re a good fit, and a simple example. That should relieve any brain cramps from the […]Read More… from Cash balance plan basics
Our philosophy for coverage and nondiscrimination testing has always been “everything passes, some plans just take a little longer to prove it”. That was put to the test recently for one of our law firm clients: an unusually young new partner was causing their §401(a)(4) nondiscrimination test to fail. We emptied the whole toolbox on […]Read More… from Fixing a §401(a)(4) test failure
We’ve been following the recent saga where the PBGC is not allowing some employers to correct their 2009 PBGC filings for apparently innocent mistakes. Now some congressional heavyweights are adding their voice to the mix. Under the new post-PPA PBGC filing rules, an employer may make an election to use either the “Standard Method” or […]Read More… from PBGC “Alternative Method” Premium Election Problems
Over the past couple of years, the GASB (Governmental Accounting Standards Board – they write the public employer accounting rules) has started the process of updating the accounting rules for public employer pension and retiree health plans. They issued an invitation for ideas/comments in 2009 and now we are getting our first sneak peek at […]Read More… from First Look at Proposed GASB Accounting Changes
Historically, the IRS has required that plan documents for terminating retirement plans be amended to reflect all legal requirements enacted up through the plan termination date. However, there was some uncertainty as to whether the “new” 5- and 6- year plan restatement rules actually required plan sponsors to: Entirely restate the plan document upon plan […]Read More… from Plan document restatements for terminating plans
Almost every employer-sponsored retirement plan (whether it’s a pension plan or a 401(k) plan) must satisfy certain nondiscrimination tests set forth in the internal revenue code. The IRS mandates these tests to ensure that if an employer is getting retirement plan tax deductions, then the plan should be designed so that benefits are not skewed […]Read More… from Passing the §401(a)(26) “meaningful benefit” test
Last week, the HHS published an interim final rule for the new Early Retiree Reinsurance Program (should we call it ERRP?). In our first post on this, we noted that a lot was still unknown. There still is, but it’s becoming clearer. The White House fact sheet says “Employers can use the savings to either […]Read More… from Update: the retiree health reinsurance gold rush
A full valuation (measurement) of GASB 45 liabilities is required every 2 to 3 years, depending on the size of the employer. In the years when actual measurements are performed, the GASB 45 results (ARC, Annual OPEB Cost, and Net OPEB Obligation) are fairly straightforward to calculate. However, there is often confusion about what to […]Read More… from Off-Year GASB 45 Accounting
