News

Barb Yearout, president of Chard Snyder, an Ascensus company, contributed content about how individuals can make the most of their HSA accounts for investment ​purposes​ to the Cincinnati Business Courier.​​

Senators Bill Cassidy (R-LA) and Robert Menendez (D-NJ) have introduced legislation that would make permanent certain rules for distributions and loans from retirement plans and IRAs in connection with federally declared disasters. This legislation is intended to aid victims by providing consistent treatment of and improving response times associated with disaster relief.

The IRS has released Revenue Procedure (Rev. Proc.) 2021-30, which contains significant updates to the Employee Plans Compliance Resolution System (EPCRS). Employers use EPCRS to correct certain retirement plan qualification failures so that they can continue to maintain a tax-favored retirement plan. EPCRS consists of the Self-Correction Program (SCP), the Voluntary Correction Program (VCP), and the Audit Closing Agreement Program (Audit CAP). Rev. Proc. 2021-30 supersedes the previous EPCRS guidance (in Rev. Proc. 2019-19) and affects each of these three programs.

In a recent PLANSPONSO​R article, Rick Irace, chief operating officer (COO) for Ascensus' Retirement line of business, talked about the importance of clean participant data when it comes to maintaining a healthy retirement plan. He notes that educating participants about why it’s important to keep their own data u​​​​​p to date is crucial to keeping data clean. He also discusses systems that Ascensus​​​​ has in place to ​​ensure that data is submitted accurately and points out that having clean data also reduces the risk of cybersecurity threats.​

Senators Cory Booker (D-NJ) and Todd Young (R-IN) reintroduced four bills in the Senate this week designed to address retirement security.

The IRS stated in its August 6, 2021 edition of the Employee Plans newsletter that employers that adopt retirement plans during the 2021 tax year, but before their 2020 tax filing deadline (including extensions) and elect to treat the plan as effective as of the last day of the 2020 tax year, as permitted by the SECURE Act, are not required to file a Form 5500 series for the 2020 tax year.

The average number of natural disasters continues to rise. As a result, Congress and the IRS have tried to keep pace by providing relief for those affected by major disasters and emergencies. In December 2019, the Taxpayer Certainty and Disaster Tax Relief Act of 2019 amended Internal Revenue Code (IRC) Sec. 7508A by requiring a new mandatory 60-day postponement period for certain tax-related acts following a federally declared disaster. To help clarify the new rule, the IRS issued final regulations in June 2021. The regulations 1) explain how the new mandatory 60-day postponement period is determined, and 2) clarify how the term “federally declared disaster” is defined under IRC Sec.165.

The IRS has issued Notice 2021-48, providing guidance about changes to the funding rules for single-employer defined benefit pension plans that were made by the American Rescue Plan Act of 2021 (ARPA). ARPA included provisions that addressed amortization relief by allowing existing shortfall amortization bases to be reduced to zero and extending funding shortfall installments for new shortfall bases to 15 years. In addition, ARPA amended segment rate minimum and maximum percentages and created an interest rate “floor” of five percent in a period of lower interest rates. These provisions are to be applied to all plans with plan years beginning in 2022 and, by election, may be adopted sooner.

Small-Market Retirement Plan Offering Includes Institutional-Quality Employee Services Such as Financial Wellness and Managed Accounts

OneDigital and Ascensus recently announced the availability of a co-created small market solution for retirement plans that brings institutional-quality employee services to plan participants.

Senator Patrick Toomey (R-PA), has re-introduced the Long-Term Care Affordability Act, legislation that would permit tax-free retirement saving distributions of up to $2,500 per year—indexed for inflation—that are used to purchase long-term care insurance. The arrangements to which the legislation applies would include qualified retirement plans, 403(a) and 403(b) plans, governmental 457(b) plans, and IRAs.