Industry & Regulatory NewsDOL Extends Comment Period, Invites Public Hearing on QPAM Exemption
The Department of Labor (DOL) is extending the comment period for receiving written comments related to prohibited transaction class exemption 84-14 (the Proposed QPAM Amendment) to October 11, 2022. The DOL also intends to hold a public hearing on November 17, 2022, at which time a supplementary comment period will begin, and close approximately 14 days after the hearing transcript is posted on the EBSA’s web page.
Details of the proposed amendment were previously announced.
Industry & Regulatory NewsIRS Issues Deadline Relief for Mississippi Water Crisis Victims
The IRS has announced the postponement of certain tax-related deadlines for victims of a water crisis in Mississippi. The tax relief postpones various tax filing deadlines that began August 30, 2022. Affected individuals and households who reside or have a business in Hinds County, as well as taxpayers with records located in the covered area that are needed to meet covered deadlines, qualify for relief.
Industry & Regulatory NewsDOL Releases Interpretive Bulletin on Auditor Independence
The Department of Labor (DOL) has released Interpretive Bulletin 2022-01 (IB) relating to independence requirements for accountants who audit employee benefit plans. Under ERISA, plan administrators of benefit plans requiring an audit are required to retain an “independent qualified public accountant” to conduct an examination of the plan’s financial statements and render an opinion as to whether the financial statements and required schedules are presented fairly in accordance with generally accepted accounting principles (GAAP).
Industry & Regulatory NewsPBGC Proposes Changes to Annual Reporting of Defined Benefit Plan Information
The Pension Benefit Guaranty Corporation is proposing modifications to reporting information it asks for on supporting schedules related to annual Form 5500 series returns. The proposal modifies line 19a and correlating instructions of the 2023 Schedule R, Retirement Plan Information, by updating the categories of assets used in identifying investments held by the plan and requiring the breakdown to be reported as of the end of the plan year rather than beginning of the plan year. Additionally, the proposal would modify line 19b and eliminate line 19c. With regard to the Schedule SB, Single-Employer Defined Benefit Plan Actuarial Information, the proposal modifies line 6 (Target Normal Cost) and correlating instructions to address an unlikely reporting inconsistency where a plan requires mandatory employee contributions and the mandatory contributions for the plan year exceed the present value of benefits accruing during the plan year. In addition, PBGC is proposing a change to line 26b attachment instructions to clarify that where a plan assumes benefits are paid in a lump sum but uses the annuity substitution rule to determine the funding target, the attachment may show projected benefits payable in the annuity form instead of the form assumed for valuation purposes.
Industry & Regulatory NewsDOL’s Proposed Restated Voluntary Fiduciary Correction Program at OMB
The Office of Management and Budget has received a proposed rule from the Department of Labor (DOL) titled “Adoption of Amended and Restated Voluntary Fiduciary Correction Program”. The Voluntary Fiduciary Correction Program (VFCP) is a voluntary enforcement program that allows plan officials to identify and correct certain transactions, such as delinquent participant contributions, sales and exchanges, improper loans, and improper plan expenses. The VFCP was last updated in 2006.
Industry & Regulatory NewsIRS Issues Yield Curves and Segment Rates for DB Plan Calculations
The IRS has issued Notice 2022-35, which contains updated guidance on factors used in certain defined benefit (DB) pension plan minimum funding and present value calculations. Updates include the corporate bond monthly yield curve, the corresponding spot segment rates for August used under Internal Revenue Code Section (IRC Sec.) 417(e)(3), and the 24-month average segment rates under IRC Sec. 430(h)(2). IRC Sec. 417 contains definitions and special rules for minimum survivor annuity requirements in DB plans. IRC Sec. 430 addresses minimum funding standards for single-employer DB plans.
Industry & Regulatory NewsDOL to Reopen Comment Period for Proposed Prohibited Transaction Procedure
The Department of Labor (DOL) has announced a public hearing scheduled for September 15, 2022, (and September 16, 2022, if necessary) regarding its proposal to supersede existing procedures for seeking exemptions from the prohibited transaction provisions of the Employee Retirement Income Security Act of 1974 (ERISA) and the Internal Revenue Code. The DOL will also reopen the comment period beginning on the hearing date until approximately 14 days after the DOL publishes the hearing transcript on the Employee Benefits Security Administration’s (EBSA) web page.
Details of the release of the proposed rule were previously announced.
Industry & Regulatory NewsSpecial Committee on Aging Holds ABLE Hearing
Senator Bob Casey (D-PA), Chairman of the Senate Special Committee on Aging, conducted a hearing titled “Saving with ABLE: Financial Security for Pennsylvanians with Disabilities.” The Achieving a Better Life Experience (ABLE) Act was passed into law in 2014, creating tax-free savings accounts for individuals with disabilities to cover qualified disability-related expenses. Senator Casey highlighted how ABLE savings accounts have helped hundreds of thousands of Americans with disabilities improve their quality of life through use of these accounts, and several witnesses shared testimony on the ease of establishing accounts without impacting means testing for other benefits.
Industry & Regulatory NewsIRS Announces Applicable Federal Rates for September 2022
The IRS has issued Revenue Ruling 2022-17, which contains the applicable federal rates (AFR) for September 2022. These rates are used for such purposes as calculating distributions from retirement savings arrangements that meet the requirements for substantially equal periodic payments (a 10 percent early distribution penalty tax exception), also referred to as “72(t) payments.”
Industry & Regulatory NewsIRS Final Rule on Electronic Filing Requirements at OMB
The Office of Management and Budget has received a final rule from the IRS titled “Electronically Filed Returns”.
The IRS released a proposed rule in July 2021 regarding electronic filing requirements for certain information returns, pursuant to the Taxpayer First Act of 2019. The proposed regulations reduce the threshold by which filers must electronically file from 250 to 100 returns for the 2022 calendar year. For filings required after calendar year 2022, the threshold will be further reduced to 10 returns.