Employee Benefits Update: October/November 2015

This issue’s topics include:

  • Be careful what you toss: Plan record retention requirements
  • Year end notices: Staying on top of the requirements
  • Survey says…Poll highlights what participants think they know
  • When electronic disclosure isn’t enough under ERISA

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As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please feel free to contact me directly.

Employee Benefits Update: August/September 2015

This issue’s topics include:

  • 401(k) rollovers: How rollovers to your plan can benefit everyone
  • DOL reproposes ERISA fiduciary investment advice regulations
  • Are you insured? Fiduciary liability insurance can help when problems arise
  • Court finds that plan document trumps beneficiary designation forms
  • Compliance alert

Employee Benefits Update August/September 2015

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As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please feel free to contact me directly.

Employee Benefits Update: February/March 2015

This issue’s topics include:

  • Navigating ERISA’s comprehensive plan document disclosure rules
  • IRS checklist offers a convenient compliance self-checkup
  • Who are functional fiduciaries? Appeals court holds service provider not a plan fiduciary
  • 2014 vs. 2015 retirement plan limits

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As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please feel free to contact me directly.

Employee Benefits Update: Year End 2014

This issue’s topics include:

  • What you need to know about ADP/ACP discrimination testing
  • Are you offering a Roth 401(k) plan option yet?
  • 401(k) plan automatic enrollment: A winning formula
  • Help participants avoid an inappropriate IRA rollover

Click Here to Download the 2014 Year End Employee Benefits Update

Click Here to Download

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please feel free to contact me directly.

Employee Benefits Update: October/November 2014

This issue’s topics include:

  • Target Date Funds and Fiduciary Duty: Examine your TDFs’ glide paths to ensure suitability
  • ESOPs facing tougher scrutiny by regulators and courts
  • Are your 401(k) plan administrative fees allocated equally?
  • DOL sets 2015 regulatory agenda

 

Employee Benefits Update October/November 2014

Click Here to Download

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please feel free to contact me directly.

Estate Planning Tip: Naming Your Spouse as Trustee

When setting up a trust, your first instinct might be to name your spouse as the trustee. Just be aware that without proper planning, naming your spouse as the trustee may cause tax and administration difficulties down the road.

Couple holding hands on beach

If your spouse has broad and/or over-reaching powers over the trust corpus, the fair market value of the trust at his/her death may be pulled into her gross estate for estate tax purposes, resulting in higher death taxes. This result may be contrary to the goals and objectives of your overall estate plan.

Also, if your spouse has strained relationships with the principal beneficiaries of the trust, it may hinder his/her objectivity to comply with the terms of the trust. He/she may have some wiggle-room based upon broad language in the trust instrument to avoid making distributions to beneficiaries which may be contrary to your intentions.

Seeking the advice of a competent estate planning professional will help minimize the above mentioned difficulties.

Estate Planning Tip: Planning for Couples in a Second Marriage

There are many factors to plan and consider when preparing for marriage, especially if you have been married before.

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In a second marriage situation, it is important to discuss with your estate planning team exactly how estate taxes will be paid. If this is not properly addressed, there are situations where the estate taxes will be paid exclusively from the inheritance of the children of the first marriage. In this scenario, assets passing to the second to die’s heirs would not bear its appropriate share of the estate tax burden. With the proper planning, this unintended consequence can be avoided simply by including the necessary language in your will.

Estate Planning Tip: Planning for Estate Taxes and Income Taxes on Business Earnings

When creating a trust to hold a business interest it is important to determine where the money will come from to pay the income taxes associated with the profits of the business allocated to the trust. Sometimes the trust instrument is drafted in such a way that the trust legally owns the business interest but the original grantor of the trust is the “deemed owner” for income taxes purposes only. This is common estate planning technique. The value of the business interest is removed from the grantor’s estate for estate tax purposes and the trust assets are not used to pay the income taxes on the profits. In this situation, the original owner is responsible to pay the income taxes but the trust legally owns the business interest.

Since the trust legally owns the business interest, the trust would be entitled to any distributions from the business not the grantor. The grantor would not be entitled to any funds from the business to pay the income taxes. Proper planning is needed to determine how the income taxes will be paid.

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