SECURE Act Provides a Tenfold Increase in Penalty for Late Filing of Retirement Plan Annual Report (Form 5500)

The Setting Every Community Up for Retirement Enhancement Act (“SECURE Act”), adopted in December 2019, has increased the penalty that the IRS may impose on plan sponsors who do not timely file Form 5500 (Annual Return/Report of Employee Benefit Plan).  Prior to the law change, the IRS could assess a civil penalty of $25 for …

What to Do if Your Company is Close to the Affordable Care Act’s 50 Full-time Employee Threshold

Having recently helped a client determine if it employed on average more than 50 employees per month in a calendar year and therefore was an applicable large employer (“ALE”) subject to the Affordable Care Act (“ACA”) in the following calendar year, I had many opportunities to see the complexities of the ACA’s rules in operation. …

The Top 5 Things to Know if You Are New to 401(k) Benefits Administration

As an advisor to many 401(k) plan sponsors, I have been asked occasionally what advice I would give to a person who is relatively new to retirement plan administration. While some aspects of administration may only be learned through experience, here are my top 5 things to understand about plan administration. 1. Identify the service …

When to Call Your ERISA Benefits Attorney

If you are responsible for the administration of your company’s retirement plan, you probably reach out to the plan’s record-keeper and investment advisor on a frequent basis.  With the extensive bundled services offered by many record-keepers, you may wonder why you even need the name of an ERISA benefits attorney in your contacts list.  An …

Time for Non-Profits to Update Their 403(b) Retirement Plans

Non-profit entities, including schools and universities, that sponsor 403(b) retirement plans should begin the process of restating their plans to comply with current law.  This is the first restatement cycle since the December 31, 2009 deadline for sponsors of 403(b) plans to adopt written plan documents.  A 403(b) plan is similar to a 401(k) plan …

Keeping the End in Mind When Managing Employee Benefits at a Company Owned by a Private Equity Fund

It is no secret that a business which is owned by a private equity fund will eventually be sold.  As part of the sale process, the potential buyer will examine the employee benefit documents and the plans’ operations to determine if there are any potential risks.  If errors are found, the seller may be required …

Confidential Settlements of Sexual Harassment Claims Are No Longer Deductible by a Company Under the Tax Act

Companies generally are allowed to deduct all ordinary and necessary expenses paid during the year to carry on a trade or business, including most expenses related to settlement of a lawsuit or claim relating to the business. But expenses such as illegal bribes and fines paid to the government for violation of any law are …

Retirement Plan Fiduciaries Can Save Money and Time by Paying Attention to the Details

Individuals responsible for the administration of a 401(k) retirement plan know that details, such as a participant’s date of hire or the number of hours worked, are important when determining an employee’s plan entry date. A lawsuit recently filed by the Department of Labor is a reminder that plan fiduciaries should also be paying attention …