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Vestwell Ramps Up Advisor Access, Abilities of JPMAM's Everyday 401k

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Latest Published Articles, Papers, and Research From Across the Web

DOL Files Counter-Brief to Retirement Security Rule Challenge

The DOL answered one of two open lawsuits in the federal courts challenging the Retirement Security Rule on June 14. The regulator's first response in court argued that the new rule is compliant with existing case law and is substantially different from a 2016 regulation that was vacated by the U.S. 5th Circuit Court of Appeals.

Source: Planadviser.com, June 2024

Dueling Decisions Spur Employer Confusion on 401k Forfeitures

Employers tasked with reallocating 401k assets forfeited by former employees are encountering a wave of litigation alleging the misuse of plan funds, as well as an emerging disagreement between judges on these suits' viability.

Source: Bloomberglaw.com, June 2024

IRS Clarifies 10% Additional Tax for Certain Emergency Distributions

The IRS issued guidance on June 20 on the application of exceptions to the 10% additional tax under Internal Revenue Code (IRC) Section 72(t)(1) for emergency personal expense distributions and domestic abuse victim distributions. The guidance comes in Notice 2024-55. More specifically, Notice 2024-55 provides guidance on the portions of the SECURE 2.0 Act that added exceptions to the 10% additional tax.

Source: Asppa.org, June 2024

Business Owners Delay Retirement Due to Savings Fears

While most business owners say they're on track for retirement, recent findings from Nationwide show that just over a third (36%) have postponed their retirement in the past year. This concern is even more prominent for small business owners, with 57% who say they have pushed back their retirement timelines.

Source: 401kspecialistmag.com, June 2024

Group Says DOL Overreaches with "Lost and Found" Database

The ERISA Industry Committee wants the DOL to back off from requiring retirement plans to provide what it calls excessive amounts of participant information for its SECURE 2.0-mandated "Retirement Savings Lost and Found" database.

Source: 401kspecialistmag.com, June 2024

Breaking Up is Hard to Do: Exiting a Retirement Plan MEP or PEP

There are many reasons that plan sponsors may decide to join a MEP, a PEO plan or a PEP, all of which are a type of Multiple Employer Plans. There are an equal number of reasons why a plan sponsor may decide it is time to exit the MEP. Perhaps the company has grown and the employer desires more flexibility, the company is purchased and needs to spin-off to merge into the buyer's plan, the level of service desired is not being met, or the plan sponsor wants to terminate the plan. No matter the reason, breaking up (with a MEP) is hard to do.

Source: Newfront.com, June 2024

HP Prevails in "Novel" 401k Forfeiture Reallocation Suit

The third of the forfeiture reallocation suits to come before a federal judge was described as a "swing for the fences" and dismissed, with a "catch." Judge Freeman commented that the plaintiff "advances a novel legal theory under which it is a breach of fiduciary duty to allocate forfeited amounts to reduce employer contributions rather than to pay administrative costs." She went on to note that "to date, there is no binding authority that addresses this theory...."

Source: Napa-net.org, June 2024

How Much Could 401k Contribution Limits Rise in 2025?

How much will the maximum 401k, 403b, and 457 deferrals for defined contribution plans rise in 2025? More than this year, if one firm's forecast is any indication. Milliman researchers Nina Lantz and Abby Kendig believe it will increase by $1,000, going from $23,000 in 2024 to $24,000 in 2025.

Source: Napa-net.org, June 2024

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