CCH Learning Center

Description:
The recession that started in 2008 hit defined benefit pension plans hard. Congress responded with funding relief, but many employers are choosing to terminate their plans if they can comply with the termination requirements. The hard times for defined benefit plans reinforce the general trend away from offering defined benefit plans and toward 401(k) plans as the retirement plan of choice.

The IRS has recognized the trend toward use of 401(k) plans, and has surveyed employers to identify common compliance issues with an eye toward improving compliance assistance.

Employee benefit plans (especially retirement plans) have annual reporting requirements, and many of these requirements have recently changed due to adoption of a new electronic filing system.

Upon completion of this course, you will be able to:

• Recognize the recent changes in compliance required under the annual Form 5500 series for employee welfare and benefit plan reporting;
• Describe how a fall in retirement plan asset values affects the employer’s funding obligations;
• Describe the funding relief available for plans and how the relief can help a plan’s cash flow;
• Describe how it helps a plan comply if it can use asset-to-liabilities ratios from a lookback year;
• Identify the purpose and scope of the 401(k) Compliance Questionnaire Project, and how the IRS is enforcing it;
• Describe the role of the PBGC (if any) in defined benefit plan terminations in contrast to defined contribution plan terminations;
• Describe the conditions under which an employer is allowed to terminate a defined benefit plan;
• Understand the consequences for vesting for purposes of plan termination; and
• Describe how multiemployer plans are terminated.