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Defined Contribution Plans
“I shall remember to pay it… to myself.” That’s not just a great line from a bar owner in Casablanca; it’s also a way to characterize 401(k) loans, argues a recent analysis.In “The Fallacy of 401(k) Loans,” a post by Michael Kitces on the FinancialPlanning.com website, Kitces points out that 401(k...
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It is all too common in human affairs to make choices that have “unforeseeable consequences.” And then there are those situations where people should have known better. Like the current rumors about capping employee pre-tax contributions at $2,400.Having the opportunity to put off paying taxes is...
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President Trump may have thought his tweet would have ended the controversy over a proposed partial Rothification of 401(k)s — but that was Monday.
While heading off on Marine One on Oct. 25, the President was asked about his comment that any changes to tax-free contributions to 401(k)s were off...
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The IRS on Oct. 19 announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2018. The 2018 limits are contained in Notice 2017-64.Increased LimitsThe IRS has increased the following limits for 2018 from 2017 levels:The...
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In September, President Trump struck a bipartisan deal with House Minority Leader Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY) that provided some immediate federal funding for the various emergencies resulting from an active hurricane season, extended the temporary suspension...
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The IRS Tax Exempt and Government Entities (TE/GE) Office has issued its fiscal year (FY) 2018 work plan. The plan outlines efforts and initiatives the office intends to follow in the new fiscal year. Actions will affect plan applications as well as steps to ensure and improve compliance.
TEGE...
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In a month that has traditionally been the worst for U.S. stocks, how did average 401(k) balances fare?
Well, let’s just say that if this is traditionally a bad month for the markets (and it has been), 2017 looks to be an exception. On Friday, the S&P 500 and the Nasdaq Composite finished at...
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Retirement industry leaders appearing at a recent Capitol Hill event generally agreed that building on the existing system would dramatically improve the retirement readiness of Americans throughout the country.In what turned out to be coincidental timing, the Financial Services Roundtable hosted a...
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Both the House and Senate on Sept. 28 approved legislation to expand access by victims of Hurricanes Harvey, Irma and Maria to their 401(k) and similar plans without incurring IRS penalties and taxes, clearing the measure for President Trump’s expected signature.
The Disaster Tax Relief and Airway...
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DC plans measured as part of the Callan DC Index realized a “healthy” 3.06% in return growth during the second quarter of 2017, reflecting strong equity market performance and the greatest first-half performance since the Index’s inception in 2006.
Combined with first-quarter gains, the Index’s...
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Rothification may not be on the table — yet — but the GOP’s tax reform outline includes a potentially nasty surprise for small business retirement plans.
Those taking a public stand against the so-called “Rothification” of 401(k)s yesterday included Rep. Richie Neal (D-MA) and Sen. Tim Scott (R-SC...
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Forgetting to repay a loan will garner one a quick reminder. But that is not enough, a recent Tax Court ruling suggests — it may be wise to verify that the payment really was made.A recent Tax Court ruling, Louelia Salomon Frias v. Commissioner, TC Memo 2017-139, provides a reminder of the...
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Congress has released draft legislation consistent with recent recommendations by the American Retirement Association to expand access by victims of Hurricanes Harvey, Irma and Maria to their 401(k) and similar plans without incurring IRS penalties and taxes.The draft legislation, currently named...
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August brought a notable uptick in 401(k) trading activity among defined contribution plan investors, according to the Alight Solutions 401(k) Index.There were three days of above normal trading activity in August, matching the total number of above normal days from January through July. Ironically...
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The Department of Labor’s Employee Benefits Security Administration (EBSA) on Sept. 15 announced that it has extended the employee benefit plan compliance guidance and relief it issued for victims of Hurricane Harvey to those affected by Hurricane Irma. Verification procedures for plan loans and...
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As stock values generally rose during the first quarter of the year, most deferred compensation plan participants continued with their asset allocations and contribution levels, and maintained low withdrawal activity, according to the Investment Company Institute (ICI).A recent ICI study, “DC Plan...
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Amid all of the recent talk about tax reform and the potential move toward Rothification, Cerulli Associates has come out with a new report showing that only one-third of DC plan participants can correctly identify the benefits of Roth contributions.The results are part of a 2017 survey Cerulli...
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Running the plan and investing its assets in a way mindful of environmental, social and governance (ESG) concerns is a practice some plans follow. But a recent commentary questions whether that complements — or compromises — fulfilling fiduciary responsibility.
In a commentary that recently...
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The IRS, Department of Labor and Pension Benefit Guaranty Corporation have granted a variety of forms of relief to certain victims of Hurricanes Harvey and Irma. But House Ways and Means Committee Chairman Kevin Brady (R-TX) may try to do what they cannot.The agencies can — and have — granted...
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What’s left of Hurricane Irma has not yet wrung itself dry, but already the IRS, Department of Labor and Pension Benefit Guaranty Corporation (PBGC) have announced fresh relief for its victims — as well as those of still very recent Hurricane Harvey.Part of the relief extends to Irma victims what...
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