ERISA Roundup - Q2 2018
ERISA Roundup - Q2 2018
A NOTE FROM BDO’S NATIONAL ERISA PRACTICE LEADER
A central mission of BDO’s ERISA Center of Excellence is sharing knowledge and best practices with the industry. We believe in the power of education to fuel growth and people development.
This quarter, many of our publications centered on this mission – to inform not only on current events, but to inspire plan sponsors to take a deeper look and identify creative solutions for the welfare of their employees.
We saw a number of newsworthy topics last quarter – GDPR went into effect; the DOL made announcements around their fiduciary rule enforcement policy; and Congress took a hard look at ESOPs. Changes to the employee benefit plan landscape make it challenging for you to stay ahead of regulations and requirements. Our ERISA practice is proud to play a role in that effort.
National Practice Leader, ERISA
IN THIS ISSUE...
Loans and Hardship Withdrawals: New Rules for Employees Dealing With Natural Disasters and Other Financial Emergencies
Natural disasters including Hurricanes Harvey, Irma and Maria, as well as the California wildfires, caused a record-breaking $283 billion in damage to homes and other property in 2017, according to the National Oceanic and Atmospheric Administration.
Uncashed Distribution Checks: Best Practices for Plan Sponsors
Defined contribution plan sponsors face numerous challenges when workers change jobs, and the Department of Labor (DOL) is paying close attention to how employers are dealing with these situations.
DOL Announces Temporary Fiduciary Rule Enforcement Policy
The Department of Labor (DOL) announced a temporary enforcement policy on May 7th explaining that it would not pursue legal action against investment advice professionals who rely on the Obama Administration’s definition of fiduciary.
Financial Well-Being for Women: Empowering Employees by Helping Them Prepare for Retirement
The growth of women’s influence in U.S. workplaces has been remarkable over the last several decades. Female labor force participation rates have increased from 43% in 1970 to 57% in 2018, according to the Federal Reserve Bank of St. Louis. As of 2016, women held 52% of all management, professional and related positions, according to the Bureau of Labor Statistics. But there are still many areas where a significant gap remains between men and women employees, including when it comes to preparing for retirement.
Employee Stock Ownership Plans Gain Attention in Congress
Congress is paying more attention to Employee Stock Ownership Plans (ESOPs) this session, with two New York legislators shepherding through bills aimed at promoting this type of defined contribution plan.
Carpe Diem! Accelerating Defined Benefit Funding to the 2017 Tax Year can Generate Tax Savings
Last year’s tax reform law has created a rare opportunity for defined benefit plan sponsors to take advantage of the tax rate difference by accelerating deductions to the year with the higher tax rate. The lowering of the corporate tax rate makes pension plan contributions for the 2017 plan year significantly cheaper on an after-tax basis than contributions for the 2018 plan year.
GDPR: What Plan Sponsors Need to Know About the EU’s New Data Protection Rules
The European Union’s (EU) General Data Protection Regulation (GDPR) went into effect May 25, and its impact reaches across the pond to many U.S.-based businesses that collect, use or store data from EU residents.
Auto-Enrollment and Auto-Escalation: Right for Your Retirement Plan?
When it comes to saving for retirement, getting started can be the hardest part for many employees. This challenge, however, is being solved for many American workers by the dramatic increase over the past decade in the percentage of 401(k) plans that use automatic enrollment and automatic escalation features to encourage participation.
Cash Balance Plans: An Effective Strategy To Maximize Retirement Savings For Key Employees
Competition for talent is fierce today, and many employers are searching for solid benefit strategies to attract and retain top employees. One approach that can accomplish these goals is the cash balance plan. These plans have been growing in popularity in recent years despite the fact that many in the benefits industry once considered cash balance plans to be nearly extinct.
Financial Well-Being for Men: Helping Them Prepare for a Successful Retirement
Many sitcoms and comedians have played with the stereotype that male drivers are notoriously reluctant to stop and ask for directions. According to research, this reluctance to ask for help also affects men as they head toward retirement—and what that means for employees’ financial well-being isn’t anything to joke about.
UPCOMING EVENTS AND HAPPENINGS
SHRM Conference 2018
Members of BDO’s ERISA team recently returned from the annual Society for Human Resource Management (SHRM) Conference & Exposition in Chicago where we helped attendees power up with BDO charging stations during breaks. BDO is proud to be a sponsor of this fantastic event geared to strengthen and develop HR practices.
We learned so much attending sessions and met a lot of great HR folks. If we missed you this time around, we hope to see you next year!
Upcoming Filing Deadline
The first filing deadline for the Form 5500 is Tuesday, July 31. Extensions should be filed if the filing deadline cannot be met.
Important Deadlines to Establish a Qualified Plan: Qualified plans must be implemented by December 31, 2018 in order to take advantage of the tax return deductions available for employers and participants. The time to start planning is now in order to have sufficient time before year end. It’s too late to start a qualified plan for 2017, but employers may consider funding a SEP, Simplified Employee Pension Plan, for the 2017 year which must be implemented by the due date of the corporate return including extensions. Note Safe harbor 401(k) plans for new businesses must be in place for at least 3 months of the year.