To be clear; a retirement plan is not required to have an Investment Policy Statement (IPS). But the more important question is should a plan have an IPS? To use a silly analogy, a person need not have a parachute to jump out of an…
No surprises. That is the objective plan sponsors should strive for when it comes to managing a retirement plan. With all the moving parts associated with retirement plan administration, it’s easy to miss things. The reality is that mistakes can and do happen, and when…
Pentegra administers many 401(k) plans that include standard after-tax contributions—the non-designated Roth 401(k) type. And one thing we have learned is that after-tax contributions can create problems for the sponsor if the plan is not carefully designed and properly administrated. In a 401(k) plan, standard…
A retirement plan committee member may be a plan fiduciary and, consequently, held personally liable to the plan if he or she is granted or exercises discretion in the operation or administration of a retirement plan that is subject to the Employee Retirement Income Security…
The Department of Labor (DOL), Internal Revenue Service (IRS) and Pension Benefit Guaranty Corporation (PBGC) have extensive reporting and disclosure requirements for qualified retirement plan officials. These reporting and disclosure requirements serve the important function of educating and supporting participants in their retirement planning journey,…
We knew it was coming—some type of auto enrollment and auto escalation mandate for 401(k) and 403(b) plans. Congress has long been a proponent of such automatic arrangements as they have proven they boost plan participation. The first “negative election” plans go back 25 years…
Just when we had figured out the required minimum distributions (RMDs) rules for retirement plan participants—Congress changed them—again! Under the SECURE Act 2.0 of 2022 (SECURE 2.0) there are no less than six changes to RMDs in all. The most talked about adjustment to the…
A frequently asked question by small business owners who sponsor savings incentive match plans for employees (SIMPLE) IRA plans is, “Can I terminate my SIMPLE IRA plan and start a 401(k) plan mid-year?” It’s a straightforward question that, currently, has a problematic answer due to…
A sweeter tax deal may await you as result of law changes if you are a “small” business owner who does not currently offer a workplace retirement plan. By small, I mean businesses with 50 or fewer employees. Section 102 of the SECURE Act 2.0…
An advisor in Ohio asked: “My client suffered an accident and cannot keep employees on at his business. He was wondering if he could lay off employees over time to avoid triggering full vesting for a partial plan termination?” Here’s What We Know The IRS…
A sweeter tax deal may await you as result of recent law changes if you are a “small” business owner who does not currently offer a workplace retirement plan. By small, we mean businesses with 50 or fewer employees. Section 102 of the SECURE Act…
A recent call with an advisor involved a question on 401(k) catch-up contributions. The advisor asked: “When does a 401(k) deferral become a catch-up contribution?” An employee salary deferral becomes a catch-up contribution when it exceeds the lowest of the following three limits (See Treasury…