Defined contribution plan

IRS Announces Tax-Related Deadline Relief for Hawaii Volcano Victims

The IRS has issued News Release HI-2018-02, announcing tax-related deadline relief for certain Hawaii residents who are victims of recent volcanic eruptions and earthquakes. In addition to postponement of tax return deadlines falling within dates identified in the news release, the relief includes postponement of deadlines for completing certain time-sensitive tax-related acts specified in Treasury Regulation 301.7508A-1(c)(1).

These acts include completion of rollovers or recharacterizations, correction of certain excess contributions, making plan loan payments, filing Form 5500, and certain other acts under this regulation. For those who qualify, such deadlines falling on or after May 3, 2018, and on or before September 17, 2018, are postponed to September 17, 2018.

The area identified as directly qualifying for relief is “Hawaii County” (also referred to as the Island of Hawaii, or the “Big Island”). The relief applies specifically to residents of the identified area, to those whose businesses or records necessary to meet a covered deadline are located there, and to certain relief workers providing assistance following the disaster events. Any individual visiting a covered disaster area who is injured or killed as a result of the events is also entitled to deadline relief. Affected taxpayers who reside or have a business located outside the covered disaster area are required to call the IRS disaster hotline at 1-866-562-5227 to request relief.

 


Ascensus Appoints Two New Regional Vice Presidents

Jeff Simes and Bas Van Rhee Join Retirement Plan Sales Team to Support Financial Advisors and Their Business Owner Clients

Dresher, PA—Ascensus, a technology-enabled solutions provider that helps more than 8 million Americans save for the future, is pleased to announce the appointment of Jeff Simes and Bas Van Rhee as regional vice presidents on the firm’s retirement plan sales team.

In these roles, they will work with financial advisors, third-party administrators, and financial institutions—including outsourcing partners and DCIO (defined contribution investment only) sales representatives—to build and maintain Ascensus’ retirement plan distribution networks. Both Simes and Van Rhee will report directly to Anthony Bologna, vice president of retirement sales at Ascensus.

Simes will represent the Northeast region, covering Connecticut, Massachusetts, Maine, New Hampshire, Rhode Island, and Vermont. He brings over 20 years of financial services experience in relationship management, business development, and sales roles. He most recently served as a regional vice president for CUNA Mutual Retirement Solutions and has also held retirement sales positions at Mass Mutual and The Hartford.

Simes earned his Bachelor of Arts degree from University of Massachusetts and his MBA from Bryant University. He also holds his FINRA Series 7, 63, and 24 designations.

Van Rhee will serve the Plains territory, which includes Arkansas, Iowa, Kansas, Missouri, and Nebraska. He has over 10 years of sales and business development experience in the retirement industry. Prior to joining Ascensus, he served as a regional retirement sales representative for Paychex where he was recognized as Paychex’s 2017 district representative of the year.

Van Rhee earned his Bachelor of Arts degree from The Master’s University and his MBA from University of Redlands. He also holds his FINRA Series 6 and 63 designations.

“The extensive knowledge Jeff and Bas bring to the team will push us forward with financial advisors and our customers,” said Jason Crane, head of retirement sales at Ascensus. “We’re pleased to welcome them to our sales team and to leverage their expertise in helping advisors select the right retirement plan for their business owner clients.”

About Ascensus

Ascensus helps more than 8 million Americans save for the future—retirement, education, and healthcare— through technology-enabled solutions. With more than 35 years of experience, the firm offers tailored solutions that meet the needs of asset managers, banks, credit unions, state governments, financial professionals, employers, and individuals. Ascensus supports over 60,000 retirement plans, more than 4 million 529 education savings accounts, and a growing number of ABLE savings accounts. It also administers more than 1.6 million IRAs and health savings accounts. As of March 31, 2018, Ascensus had over $187 billion in total assets under administration. For more information about Ascensus, visit ascensus.com.

View career opportunities at careers.ascensus.com or on LinkedIn at linkedin.com/company/ascensus. For the latest company news, follow @AscensusInc on Twitter.


Advisory Group Recommends Missing Participant and Determination Letter Program Changes to IRS

The Advisory Committee on Tax-Exempt and Government Entities (ACT) has issued its 2018 Report of Recommendations to the IRS on several issues potentially affecting tax-exempt entities, including tax-qualified retirement plans. Recommendations specific to retirement plans include potential broadening of the IRS determination letter program, and administration of the IRS’s missing participant program.

The IRS in 2015 announced a significant scaling back of its program of issuing determination letters, which affirm plans’ qualified status. For example, beginning in 2017, individually designed plans could only submit for determination letters at the time of plan establishing or termination, with certain exceptions to later be specified by the IRS. Earlier this year the IRS requested comments on types of plans and circumstances that might justify the Service reopening a broadened determination letter program for 2019. This 2018 ACT report offers recommendations on circumstances and parameters for a limited reopening of the determination letter program not only for 2019, but for beyond as well.

The report also makes recommendations concerning missing plan participants. Among these are a recommendation that IRS coordinate missing participant guidance with the Department of Labor and Pension Benefit Guaranty Corporation, that it reopen the IRS’s former letter forwarding program, allow uncashed check amounts to be forfeited (subject to reclaiming), apply plan distribution field directives to distributions other than required minimum distributions, etc.


Ascensus Named Preferred Vendor by Nebraska Bankers Association

Firm Helps Solve Banks’ IRA Compliance Challenges with Innovative Training and Product Offerings

Dresher, PA—Ascensus, a technology-enabled solutions provider that helps more than 8 million Americans save for the future, has announced that the Nebraska Bankers Association (NBA) named Ascensus as a preferred partner for its IRA products and training solutions.

The NBA and its subsidiary, Nebraska Bankers Insurance & Services Co. (NBISCO), have done a due diligence review of Ascensus’ products and training solutions and recommend Ascensus’ Fully- and Self-Administered Programs, IRA Essentials OnDemand, and IRA University to their member banks. NBA’s recommendation lets member banks know that Ascensus delivers IRA administration and training that focuses on innovation and compliance so that they can focus on their core businesses.

“Ascensus, NBA, and NBISCO have a long history of working together in support of Nebraska banks,” states Steve Christenson, executive vice president at Ascensus. “We look forward to many years of partnership and assisting NBA member banks to help their clients save for retirement and healthcare.”

“NBISCO’s commitment to extraordinary service to NBA-member financial institutions includes a desire to refer our members to vendors who share our passion for excellence,” states Scott Yank, executive vice president at NBISCO. “Our goal is to provide competitively priced products and services that will bring positive results for our member banks.”

“For this reason, NBISCO has entered into a preferred vendor relationship with Ascensus,” continues York. “We feel that the products offered will be a value-added service for NBA member banks.”

About Ascensus

Ascensus helps more than 8 million Americans save for the future—retirement, education, and healthcare— through technology-enabled solutions. With more than 35 years of experience, the firm offers tailored solutions that meet the needs of asset managers, banks, credit unions, state governments, financial professionals, employers, and individuals. Ascensus supports over 60,000 retirement plans, more than 4 million 529 education savings accounts, and a growing number of ABLE savings accounts. It also administers more than 1.6 million IRAs and health savings accounts. As of March 31, 2018, Ascensus had over $187 billion in total assets under administration. For more information about Ascensus, visit ascensus.com.

View career opportunities at careers.ascensus.com or on LinkedIn at linkedin.com/company/ascensus. For the latest company news, follow @AscensusInc on Twitter.

About Nebraska Bankers Association

The Nebraska Bankers Association (www.nebankers.org), founded in 1890, is the voice of Nebraska’s $72 billion banking industry, which is composed of small, regional, and large banks that together employ more than 14,000 people, safeguard nearly $59 billion in deposits, and extend more than $53 billion in loans, all within the state of Nebraska.


Steve Christenson Addresses Using HSA Savings for Long-Term Care

In his original article ​published by Employee Benefit News, EVP Steve Christenson discusses how HSA savings can be used for long-term care in retirement. “If using the HSA savings for in-home care, individuals should document all expenses paid from the HSA, including documentation showing that the individual meets the IRS’ chronically ill definition,” states Christenson.


Dennis Zuehlke Discusses New IRS Reporting Requirement

In a recent article published by the Credit Union National Association, Dennis Zuehlke discusses how to prepare for the new Internal Revenue Service (IRS) reporting requirement. The IRS now requires separate reporting of any late rollover contributions self-certified by an individual retirement account (IRA) owner on Form 5498, IRA Contribution Information.


Three States Denied in Their Appeal Seeking to Intervene in Fiduciary Litigation

One week after filing an appeal in an attempt to save the DOL’s ill-fated investment fiduciary guidance (the Department of Labor conflict-of-interest regulations), the states of California, New York, and Oregon are denied that opportunity by the U.S. Fifth Circuit Court of Appeals. This Court had ruled in March 2018 that the Department of Labor’s (DOL’s) fiduciary investment advice guidance for retirement savers went beyond the agency’s authority, and vacated—essentially nullified in its entirety—the DOL’s final regulations and related exemptions. When the DOL failed to appeal this ruling, these states and the American Association of Retired Persons (AARP) filed a motion on April 26 seeking the right to intervene in support of the DOL fiduciary guidance, on the grounds that investors and the states would be harmed by the Appeals Court’s action vacating the guidance.

On May 2, this request by the states and AARP to intervene was denied by the Fifth Circuit Court. Two weeks later, on May 16, the state Attorneys General of California, New York and Oregon (this time absent the participation of AARP) filed an appeal. The states hoped their arguments in support of maintaining the DOL fiduciary guidance would be heard by the full 17-member panel of Fifth Circuit Appeals Court judges, rather than the three-judge panel that had vacated the guidance in March. Instead, the same three-judge panel has now denied both of the state attempts to intervene.

There appear to be no more options for the states in pursuit of maintaining the DOL investment fiduciary guidance, although the Fifth Circuit has yet to issue its official mandate implementing the March 15 decision that would vacate the guidance nationwide. It appears that the only known litigation step that could now be taken would be for the DOL itself to appeal to the U.S. Supreme Court. Given the DOL’s decision not to appeal at the Circuit Court level, most feel there is no reason to believe the agency will do so.

Unwilling to concede defeat, however, on May 17 a group of five Senate Democrats—Patti Murray (WA), Ron Wyden (OR), Elizabeth Warren (MA), Sherrod Brown (OH) and Cory Booker (NJ)—sent a letter to Secretary of Labor Alexander Acosta asking the Secretary and his agency to pursue an appeal to the U.S. Supreme Court. They pointed out that before the Fifth Circuit Court’s March 15 ruling nullifying the DOL investment fiduciary guidance, four other court challenges to the fiduciary guidance had been attempted and all had failed. Only one court—the Fifth Circuit—found that the DOL had exceeded its rulemaking authority in issuing its investment fiduciary guidance.

The senators also cited the statement by Secretary Acosta in 2017 that there was “no principled legal basis” to delay implementing the investment fiduciary guidance. The senators pointedly asked the Secretary to tell them how his agency proposes to protect the interests of retirement savers, absent the DOL’s fiduciary guidance. They have requested a response by June 1.

 


Attorneys General Appeal for Right to Intervene in Support of DOL Fiduciary Guidance

The states’ Attorneys General of California, New York, and Oregon yesterday (May 16) filed an appeal of their recent setback in litigation over the Department of Labor (DOL) fiduciary investment advice guidance. The U.S. Fifth Circuit Court of Appeals ruled in March 2018 that the DOL’s fiduciary guidance had gone beyond the agency’s authority and vacated—essentially nullified—the DOL’s final regulations and related exemptions in their entirety.

Background and New Filing

When the DOL failed to appeal this ruling, these three states and the American Association of Retired Persons (AARP) filed a motion on April 26 seeking the right to intervene in support of the DOL fiduciary guidance on the grounds that investors and the states would be harmed by the Appeals Court’s action vacating it. On May 2, this joint request for the right to intervene in support of the guidance was denied by the Fifth Circuit Court.

Yesterday (May 16, 2018) was the deadline for an appeal of this denial, and as noted earlier, the three Attorneys General did file another appeal yesterday asking the Fifth Circuit Court of Appeals to reconsider its May 2 decision. This appeal, however, does not include the AARP.

Possible Consideration by Full 15-Member Appeals Court

The March ruling that vacated the DOL fiduciary guidance was rendered by a three-judge panel, rather than the full membership of judges (15) on the Fifth Circuit Appeals Court. The states would ultimately prefer to make their case for retaining the DOL fiduciary guidance before the entire 15-member Appeals Court. The Attorneys General wrote in their filing, “If the panel declines to reconsider its order denying intervention, the States ask that the Court direct the Clerk to permit the filing of a petition seeking review of that order by the full Court.”

What Next?

If this attempt by the states to intervene on behalf of the fiduciary guidance fails, it appears that the only step that could be taken to preserve the fiduciary guidance would be for the DOL itself to appeal to the U.S. Supreme Court.  Given the DOL’s decision not to appeal at the Circuit Court level, there is no reason to believe it would do so.


IRS Reminder That Group VCP Option Is Available for PPA Non-Amenders

The IRS has released a reminder notice that a group submission option is available to correct retirement plan failures to amend timely for provisions of the Pension Protection Act (PPA).

The deadline for signing a restated plan document for PPA provisions was April 30, 2016. Plans may submit individually to correct this missed deadline failure under the IRS’s Voluntary Correction Program (VCP), which is an option within the broader Employee Plans Compliance Resolution System (EPCRS).

The group submission option allows financial organizations and service providers to essentially bundle multiple retirement plans that have this same amending failure, thereby reducing paperwork and cost. Several conditions apply to group submissions, the most basic being that 20 or more plans are required. The submission fee is $10,000 for 20 plans and $250 for each additional plan, up to a maximum of $50,000.