Importance of Minutes as Evidence of Corporate Governance

Corporate governance is how a company polices itself and employees. It is intended to increase the accountability of the company, serve as a preventative measure, and help build transparency and trust. Corporate governance as it relates to plan administrators involves meeting your fiduciary responsibilities. Under the Employee Retirement Income Savings Act (ERISA), meeting your fiduciary …

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An Easier, Cheaper 60 Day Rollover Waiver

The IRS has had a major change of heart that is good for taxpayers. They recently issued Revenue Procedure 2016-47 which established a “self-certification” procedure enabling a taxpayer to complete a retirement plan rollover (despite missing the 60-day deadline) by certifying to the administrator of the recipient plan or IRA that the deadline was missed …

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Hardship Distributions

There may be a point in your life when you have an event that requires some cash. If you do not have that cash on hand, you may be forced to look into other options such as selling assets. Another option could be a hardship distribution from your retirement plan. A hardship distribution is when …

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Plan Terminations and Partial Terminations

Employers are allowed to terminate 401K benefit plans offered to employees for a variety of reasons. Employers are not required by law to provide retirement savings plans, and can terminate them as a part of a bankruptcy or merger, in order to switch to another type of plan, or voluntarily terminate the plan. According to …

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Retirement Plan Loan Alternative

Many retirement plan participants may already know about the option to take out a loan against their retirement account. What you may not know about is the option to take out a hardship (though, all plans may not offer the option). A hardship, as defined by the Internal Revenue Service (“IRS”), “must be made on …

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Target Date Funds

Does your plan have target date funds (TDFs)? Are you doing enough in managing those investments as the plan fiduciary? Let’s see what the Department of Labor (“DOL”) says about these funds. The DOL has general guidance on the selection and monitoring of TDFs. With many plan sponsors making these TDFs available to participants, it …

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How to Prepare for Your 401(k) Audit

There are a few simple steps that can be taken during the planning phase of the audit in order to gain efficiencies during the fieldwork phase. You should be in communication with your auditor before the Plan’s year-end date. This is the best time to come to an agreement about the terms, timing and fees …

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DOL Fiduciary Rule

The Department of Labor (“DOL”) has been working on revisions to the current “Fiduciary” Conflict of Interest Rule for multiple years but on April 8, 2016, the DOL’s final rule was posted to the Federal Register which is effective June 7, 2016 and applicable beginning April 10, 2017. The rule now defines who is a …

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Forming a 401(k) Plan Committee

As a Plan Sponsor, you have important fiduciary responsibilities which, according to the Employee Benefits Security Administration (“EBSA”) within the Department of Labor (“DOL”), include: Acting solely in the interest of plan participants and their beneficiaries Carrying out duties prudently Following the plan documents (unless inconsistent with ERISA) Diversifying plan investments Paying only reasonable plan …

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Plan sponsor record retention guidelines

As plan auditors we are frequently asked how long documents relating to a plan should be retained by the plan sponsor. Like anything related to the Internal Revenue Service (IRS), there is no one simple answer. Before discussing some general guidelines on record retention, let’s discuss some general responsibilities of the plan sponsor to operate …

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