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2018 Cost of Living Adjustments

The IRS has released the cost of living adjustments that affect the dollar limits for various retirement plans and health & welfare plans for the 2018 tax year. Many of the limits have increased from 2017 to 2018 due to an increase in the Consumer Price Index on which these limits are based.

Please contact your Nyhart consultant for additional information or questions.

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IRS Finalizes New Mortality Table

In order to reflect the increased longevity of today’s society, the IRS has finalized regulations that adopt a new mortality table for use with pension plans. This increased longevity has several impacts on defined benefit plans - minimum funding requirements, lump sum payments and Pension Benefit Guaranty Corporation (PBGC) premiums.

Minimum Funding

A portion o...


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Holistic Financial Planning for Employees

Employees have many financial concerns. Yet only half work with financial professionals. So they are increasingly looking to their employer for help. Employers who offer no assistance are missing out on productivity, retention and recruiting gains. Enter Votaire.

Votaire is a personalized and comprehensive financial planning platform t...


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Fiduciary Rule Moving Forward

The Department of Labor (DOL) recently confirmed that, barring any action by the courts or Congress, the effective date of the DOL’s fiduciary rule will not be delayed further.  The rule will take effect in part on June 9, 2017 with the full implementation of the rule taking effect on January 1, 2018.

Originally, the rule was scheduled to take effect April 10, 2017.  However, ...


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IRS Announces 2018 HSA and HDHP Limits

The IRS has released the cost of living adjustments to the limits for Health Savings Accounts (HSA) and High Deductible Health Plans (HDHPs). Most of the limits have changed for the 2018 tax year.                                 

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403(b) Remedial Amendment Period – IRS Guidance

March 31, 2020 will be the last day of the initial remedial amendment period (RAP) for 403(b) plans. The remedial amendment period is the time allowed for employers to correct operational functions or language errors in their plan(s).

A look back – and what was missing:

You may recall, in 2007 the IRS put out regulations requiring 403(b) plans to have a written plan document. ...


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DLGF Reporting Requirement

Since 2014, the Indiana Department of Local Government Finance (DLGF) has required political subdivisions to report by March 1st of each year their Other Post-Employment Benefits (OPEB) liabilities online through the DLGF website using their Gateway portal. Benefits defined as OPEB include healthcare and other non-pension benefits provided to employees at retirement, which may include medical, ...


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Partnership & C-Corporation Reminder: Tax Return Filing Date Changes

Beginning with fiscal years ending after December 31, 2015 (the 2016 tax season), the filing deadlines have changed, which is good news. The changes are a result of years of activism by tax preparers. The new deadlines create more logical flow for businesses with pass-through income. However, beware these changes are imbedded in a law that gives the Internal Revenue Service (IRS) an increased...


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21st Century Cures Act – A Welcome Gift to Small Employers!

On December 13, 2016, President Obama signed the 21st Century Cures Act (“Act”). Tucked deep away, towards the end of the law, is a welcome gift to small employers! The law makes it possible for small employers to use Health Reimbursement Arrangements (“HRA”s) to pay back employees who buy their own health insurance.

Beginning January 1, 2017, companies with less than 50 emp...


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2017 Cost of Living Adjustments

The IRS has released the cost of living adjustments that affect the dollar limits for both retirement plans and health & welfare plans for the 2017 tax year. Most limits will remain unchanged from 2016 to 2017 because the increase in the Consumer Price Index did not meet the statutory thresholds for their adjustment.

Please contact your Nyhart consultant for additional informatio...


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IRS Announces Regulations For Lump Sum Distributions

Some defined benefit plans offer no lump sum payment option. For the many that do, the choice is an “all or nothing” lump sum payment or annuity payments (fixed payments for a period). The IRS recently announced great news to those participants wanting or needing more flexibility when facing how their retirement plan payments come to them. New IRS rules clarify and simplify the rules fo...


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IRS Extends Temporary Nondiscrimination Relief

Many employers have closed their defined benefit (DB) plans to new participants. This has been done to reduce costs and lower future funding duties. These closures are often called “soft-frozen” or “closed” plans, where participants prior to a certain date are still active. Now employers are finding they cannot afford to meet any of the nondiscrimination testing alternatives and fund the DB pla...


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IRS Updates Employee Plans Compliance Resolution System (EPCRS)

We do not live in an error-free world. While it would be great if all retirement plans could be amended one time, and one time only, it is not reality. The IRS recognizes this and designed the Employee Plans Compliance Resolution System (EPCRS) to address plan correction issues. EPCRS lets plan sponsors correct some common plan failures to satisfy the plan qualification requir...


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IRS Relief for Missed Rollover Deadline

The IRS just made what many experts are calling a surprise move.

Savers who miss a 60-day deadline for rolling over their IRA or workplace retirement savings plan, like a 401(k), are getting a second chance.

This comes as a relief to plan sponsors often facing issues with participants who, by accident, don’t get their rollover funds deposited timely. The 6...


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Deadline for PPA Restatements

On April 6, 2016, the Department of Labor (DOL) announced the final fiduciary rule which has meaningful implications for the definition of a fiduciary as it applies to investment advice. The final rule, which is the result of a nearly six-year process, describes the circumstances under which a person providing investment advice would be considered a fiduciary under the Employee Re...


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Department of Labor Finalizes “Fiduciary Rule”

On April 6, 2016, the Department of Labor (DOL) announced the final fiduciary rule which has meaningful implications for the definition of a fiduciary as it applies to investment advice. The final rule, which is the result of a nearly six-year process, describes the circumstances under which a person providing investment advice would be considered a fiduciary under the Employee Re...


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Impact of Obergefell v. Hodges on Health and Welfare Plans

The IRS recently issued Notice 2015-86, providing initial guidance on the impact of the U.S. Supreme Court’s decision in Obergefell v. Hodges on health and welfare plans, and further guidance on the application to retirement plans. The Notice confirms that the Obergefell decision does not require any changes to the terms of a health and welfare plan, noting that if the plan offers be...


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Internal Revenue Service Issues New Guidance on Mid-Year Amendments to Safe Harbor Plans

The Internal Revenue Service (IRS) has historically been very restrictive with respect to what changes could be made mid-year to a safe harbor plan. However, IRS Notice 2016-16 erased most  restrictions that kept employers from adopting mid-year amendments to safe harbor 401(k) and 403(b) plans.  The Notice provides much needed guidance and allows a change to be made mid-year if the following r...


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Internal Revenue Service Announces Changes to Voluntary Correction Program Compliance Fees

When mistakes are made with respect to a qualified plan, one option that is available to a plan sponsor is the Voluntary Correction Program (VCP) under the Internal Revenue Service (IRS) Employee Plans Compliance Resolution System (EPCRS) to fix the mistakes. To encourage employers who sponsor 401(a) qualified retirement plans and 403(b) plans to correct plan failures, the IRS has announced i...


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IRS gives guidance on how to apply retroactive transit benefits for 2015

The IRS issued Notice 2016-6 to provide procedures for employers on how to actually apply transit benefit adjustments for 2015 stemming from The Protecting Americans from Tax Hikes Act of 2015 (PATH Act).  The Act retroactively and permanently reinstated parity for parking and mass transit benefits where previously mass transit benefits were limited to $130/month and parking benefits were limit...


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IRS Q&A on Health Reform Discusses HRAs and Health FSA Carryover

On December 16, 2015, the Internal Revenue Service issued Notice 2015-87 containing guidance on a wide-range of topics under the Affordable Care Act (ACA).  The Notice reaffirms existing guidance on a Health Reimbursement Arrangement’s (HRA) inability to reimburse premiums paid for individual health insurance premiums unless an exception applies.  Among other items, the Notice also discusses He...


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Transit Benefit Retroactive Extension for 2015

Earlier this year, the IRS extended retroactively for 2014 a measure that increases the maximum monthly exclusion amount for mass transit passes and van pool benefits from $130/month to $250/month. This change was made so that these transportation benefits matched the $250/month exclusion for qualified parking benefits.  This provision expired at the end of 2014. The recently signed Protecting ...


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Impact of Obergefell v. Hodges on Employee Benefit Plans

The United States Supreme Court (“Court”) ruled in Obergefell v. Hodges (“Obergefell”) that same-sex marriage bans are unconstitutional. The decision in Obergefell is a continuation of the Court’s expansion of protections of married same-sex couples from United States v. Windsor. Obergefell will primarily impact private employers with respect to state law including ...


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Affordable Care Act Cadillac Tax Delayed to 2020

On Friday, December 18, 2015, President Obama signed a $1.1 trillion omnibus spending bill, which included a provision to delay the Affordable Care Act’s (ACA) “Cadillac tax” on high-cost employer sponsored health plans. The Cadillac tax that was originally scheduled to take effect in 2013 and then delayed to 2018, has now been pushed back again to 2020.  The bill also makes the tax a deductible e...


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2016 Cost of Living Adjustments Announced

The IRS has released the cost of living adjustments that affect the dollar limits for both retirement plans and health & welfare plans for the 2016 tax year. Most limits will remain unchanged from 2015 to 2016 because the increase in the Consumer Price Index did not meet the statutory thresholds for their adjustment. While health FSAs experience no limit increase, plan sponsors may still allow...


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PPA Restatements for Defined Contribution Plans

The IRS requires all retirement plans to be restated periodically to ensure that a plan accurately reflects current regulations and legislation. The current round of restatements is referred to as the “PPA restatement” and applies to employers using pre-approved 401(k), profit-sharing, or other defined contribution plan documents. These pre-approved plans receive approval in advance from the IRS t...


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Revisions to the IRS Determination Letter Program

Historically, a plan sponsor could get assurance that their retirement plan was in compliance with current laws and regulations by requesting a favorable determination letter from the IRS, which allowed sponsors to be confident in the tax-qualified status of their plan. These requests were made in accordance with a five-year restatement cycle established by the IRS.   However on July 21, 2015 the ...


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Significant Changes to GASB Reporting of OPEB Liabilities

Other Post-Employment Benefit (OPEB) accounting standards are once again in the spot light. The Government Accounting Standards Board (GASB) issued two pronouncements (GASB statement numbers 74 and 75) in June 2015, which significantly changed the financial reporting requirements by state and local governments of their OPEB liabilities. Easily the largest change since the implementation of accrual...


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IRS Limits Lump Sum Distribution Options

In Notice 2015-49 the IRS placed limits on the ability of a plan to offer lump sums to participants that are receiving annuity payments from a defined benefit plan.  The ability to allow participants to change from an annuity to a lump sum payment is a strategy often referred to as “de-risking” whereby the plan tries to manage risk by cashing out retirees and terminated participants and shifting t...


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Monitoring Differing Terms in your SPD vs. the Plan Document

A recent court case out of the Sixth Circuit Court (Pearce v. Chrysler Group LLC Pension Plan) reminds plan sponsors to carefully monitor the terms and provisions used in the retirement plan document versus those used in the summary plan description (SPD).  The court held that a material conflict between an SPD and the plan permits a participant to file a claim. Chrysler offered Pearce a ...


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