Topic: Regulatory Updates

An Analysis of the SECURE Act

On December 20, 2019, the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 was enacted. The SECURE Act is the most sweeping retirement legislation since the Pension Protection Act of 2006, and many of its provisions are designed to make retirement plans more accessible to employees and less cumbersome for employers.
 

U.S. Treasury Issues Final Regulations on Reportable Policy Sale Provisions

On October 25, 2019, the Internal Revenue Service (IRS) issued Final Regulations, which established rules around the Reportable Policy Sale provisions included in the Tax Cuts and Jobs Act of 2017 (TCJA). The Reportable Policy Sale provisions included in the TCJA were written in a way that could cause policies acquired through an acquisition (or potentially other policy transfers) to be subject to future taxation.

Pension Plan Sponsors Continue to Search for Ways to Reduce Liabilities

In an environment where defined benefit pension plans are seeing rising costs from declining interest rates, rising participant longevity/mortality, and rising Pension Benefit Guaranty Corporation premiums, most pension plan sponsors are looking for ways to manage, or eliminate, their defined benefit liabilities and their annual pension expense. 

Treasury Issues Final Regulations on Reportable Policy Sale Provisions

Last month, the Internal Revenue Service (IRS) issued Final Regulations, which established rules around the Reportable Policy Sale provisions included in the Tax Cuts and Jobs Act of 2017 (TCJA).

IRS Plan Limits

Each year, the Internal Revenue Service publishes updated dollar limitations for tax-qualified defined benefit and defined contribution plans. The limits are important for tax-qualified plans, as well as many non-qualified plans.

Department of Labor Loosens Restrictions on MEP 401(k) Defined Contribution Plans

Small and mid-size businesses now have greater access to defined contribution retirement plans under regulations issued by the Department of Labor (DOL) on July 31, 2019. The regulations, which loosen prior restrictions on multiple employer plans, take effect on September 30, 2019. The DOL regulations permit employers to connect with associations of employers in a city, county, state or multi-state metropolitan area in order to offer defined contribution retirement benefits to employees. Employers also have the option of banding together by industry to achieve the same purpose.

New Hardship Rules, Other Statutory Changes Reflected in Newly Proposed 401(k) Regulations

The Treasury Department has issued proposed regulations that provide guidance on changes to the hardship distribution rules made by the Bipartisan Budget Act of 2018 ("BBA"). 

Update: Hardship Distributions for Damaged Residences 

Recently enacted federal tax legislation made a change to the types of personal casualty losses that qualify for a casualty deduction under Section 165 of the Internal Revenue Code. Starting in 2018, only casualty losses attributable to a federally declared disaster will be deductible. This change will be in effect from 2018 through 2025 and immediately affects many 401(a), 401(k), and 403(b) plans that allow for hardship distributions.

2018 Budget Act Contains Retirement Provisions

The Bipartisan Budget Act of 2018 (the “Act”) was enacted on February 9, 2018.  The Act includes a number of provisions that will affect qualified retirement plans.

Update: New Disability Claims Regulations

On January 5, 2018, the Department of Labor announced that the new disability claims procedure regulations will go into effect on April 1, 2018. As we previously shared, the Department had delayed the effective date of the new rules from January 1, 2018 to April 1, 2018, in order for it to consider comments and data submitted by interested parties regarding the impact the new rules would have on costs and, ultimately, on workers’ access to disability insurance coverage. 

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