Every plan sponsor has a fiduciary responsibility to account for all funds in a retirement plan—including uncashed distribution checks. Do you know what your responsibilities are when a check goes uncashed or a plan participant falls off the grid? Is there a point at which you are no longer liable?
Although it's certainly true that not enough Americans are saving for retirement, it's also true that the many millions who are saving do so through an employer-sponsored defined benefit 401(k) plan. And as you may well know, 401(k) plans tend to generate a considerable amount of financial activity. The mobility of today's workforce means employees often request distributions when they move from one employer to another. Rollovers are common, too, as are hardship withdrawals.
The first question on many FAQs for qualified plans is: How do I borrow from my plan? But just because the question is often asked, doesn’t mean the answer is simple.
The Employee Retirement Income Security Act of 1974, also known as ERISA, helps protect those saving for retirement by mandating certain fiduciary responsibilities of those working in the retirement plan industry. In April 2017, the rules governing those responsibilities will change. Will you be ready?
This month's newsletter is all about "Fun with Forfeitures." Can forfeitures be fun? Does alliteration - finagling forfeitures, fooling around with forfeitures, finessing forfeitures - make it more fun than it really is? Probably. But for businesses managing retirement plans, forfeitures (when a plan participant forfeits a non-vested portion of his or her account) is essentially inevitable.
If your business offers a 401(k) plan—or another type of qualified retirement plan—you have been completing and submitting a 5500 form every year since the plan was initiated. And every year the IRS, the Department of Labor and the Pension Benefit Guaranty Corporation use the information contained in the 5500 to assess your plan’s compliance and its ability to protect the employees who are contributing.
Part-time employees may play an important role in your business, which can be a good thing for your bottom line - and can allow welcome flexibility for your employees, too. Many companies, from manufacturing to health care, are reaping the benefits of a multifaceted work force.
It might not surprise you to hear that the IRS has some fairly complicated rules governing compensation levels and retirement plan contributions. In fact, the IRS reports that a good number of plan sponsors get this key issue wrong - a mistake that can cost both time and money.
The term “fiduciary” gets used a lot these days; sometimes, we suspect, without a true understanding of what the term means and how fiduciary responsibility applies to our industry. It’s a corner of the retirement plan industry that can be a little murky.