Every year the Internal Revenue Service (IRS) and Department of Labor (DOL) conduct thousands of audits of employee benefit retirement plans. While IRS audits focus on compliance with the Internal Revenue Code, and DOL audits focus on violations of the Employee Retirement Income Security Act of 1974, as amended (ERISA), a review of these audits over the last five years reveals that auditors at both agencies are increasingly focused on the internal controls employers maintain for their employer benefit plans.
Please click here to read the full article View From McDermott: Top IRS and DOL Audit Issues for Retirement Plans, published by Bloomberg BNA Pension & Benefits Daily on 8/13/14.
On May 2, 2014, the U.S. Department of Labor (DOL) Employee Benefits Security Administration (EBSA) issued proposed regulations which seek to amend the notice requirements under the Consolidated Omnibus Budget Reconciliation Act (COBRA). The changes are intended “to better align the provision of guidance under the COBRA notice requirements with the Patient Protection and Affordable Care Act (ACA) provisions already in effect, as well as any provisions of federal law that will become applicable in the future.”
Under COBRA, a group health plan must provide participants with a general COBRA notice and COBRA qualified beneficiaries with an election notice. These notices describe a qualified beneficiary’s right to continue coverage under a group health plan. On May 8, 2013, DOL issued Technical Release 2013-02, which included a series of model COBRA notices (see “Notice of Coverage Options Available Through the Exchanges” for more information). These model notices include references to the ACA, noting that some qualified beneficiaries (1) may want to consider and compare health coverage alternatives to COBRA continuation coverage that are available through the ACA exchanges and (2) may also be eligible for a premium tax credit to help pay for the cost of coverage.
The proposed regulations eliminate the current versions of the model notices. However, until the regulations are finalized and effective, the DOL will consider appropriately completed use of the model notices that are currently available on its website to constitute good faith compliance with the notice content requirements of COBRA. Once the current notices are available, they will be posted at the following links:
New guidance issued by the U.S. Department of Labor (DOL) aims to help participants and beneficiaries with the “decumulation” phase of retirement planning by requiring sponsors to provide illustrations of lifetime retirement income.
The U.S. Departments of Labor, Health and Human Services, and the Treasury recently issued new guidance and templates regarding the summary of benefits and coverage requirement under the Patient Protection and Affordable Care Act.
The U.S. Department of Labor (DOL) audits already evaluate a company’s compliance on a spectrum of laws, statutes and regulations. However, the DOL has updated and revamped its audit letter to now also capture compliance aspects of the Patient Protection and Affordance Care Act. Not only is the DOL looking for certain compliance information on health plans, but also for the various records and documents related to the plan.
The U.S. Department of Labor (DOL) pushed back the deadline for employers to notify their workers that they can purchase medical benefits on health insurance exchanges. The original deadline was March 1, 2013, and has now been moved to late summer or early fall 2013. The DOL said it was aiming for a “smooth implementation process” that would balance the need to give employers sufficient time to comply with the desire that notices be distributed closer to the October 1, 2013 start of exchange enrollment.
In its announcement, the DOL said it might provide “generic language” that employers could distribute to satisfy the notice requirement. Alternatively, the DOL said it might allow use of a template that was discussed in the proposed rules published in the Federal Register (See Volume 78, Number 14, Tuesday, January 22, 2013).
The notices are required to have three components:
The first will inform workers that exchanges exist, what benefits they offer and how they can get in touch with an exchange.
The second must tell individuals they might qualify for tax credits to subsidize purchase of insurance on exchanges if their company health plan covers less than 60 percent of costs. However, a minimum value calculator hasn’t yet been released by the U.S. Department of Health and Human Services and the Internal Revenue Service.
The third will let individuals know that if they buy medical coverage through an exchange, they could lose the employer’s contribution to the employer’s group medical plan.
We will keep you updated as further guidance is released.
The new 401(k) participant fee disclosure rules issued by the U.S. Department of Labor require plan administrators with calendar year plans to send disclosures to plan participants by August 30, 2012. The top 10 things to consider in complying with the new rules are described in this publication in Q&A format.
For most defined contribution plans, initial annual fee disclosures are due to participants by August 30, 2012. In order to facilitate compliance with the new fee disclosure rules, the U.S. Department of Labor recently issued Field Assistance Bulletin 2012-02, which provides helpful commentary on 38 common disclosure questions, including disclosure of administrative expenses and brokerage window fees.
Two years after the Internal Revenue Service (IRS) and U.S. Department of Labor (DOL) jointly issued a high-profile Request for Information regarding how defined contribution plans can better provide lifetime income, the IRS and Department of the Treasury have issued some initial guidance. DOL guidance, expected to further underscore the importance of the issue, is anticipated “in the near future.”
The U.S. Department of Labor recently issued guidelines for the electronic distribution of mandatory investment and fee disclosures for participants in self-directed account plans subject to ERISA. This guidance may help plan administrators implement the new rules for the disclosure of quarterly and annual plan-related information, but still contains affirmative participant approval requirements for the electronic distribution of all initial disclosure notices and mandated investment-related information to participants. Prior to August 2012, plan sponsors and administrators of calendar-year plans should familiarize themselves with the new guidelines to determine what mandatory disclosures will be made in electronic format (if any), and whether their plans have sufficient systems and administrative capabilities to provide the mandatory disclosures in an electronic format.
Subscribe
