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Defined benefit plans, also known as pensions, enhance employer retirement plan benefit packages by providing specific benefits to eligible participants upon their retirement date. Defined benefit plans are attractive to potential employees due to lifetime benefit payments, clear contribution rules, and low financial risk for non-contributing employees. Despite sounding straightforward, defined benefit plans carry a unique set of considerations and requirements for employers and plan administrators. Defined benefit plans almost always obtain funds entirely from employers, meaning employers carry the majority of investment risk, not plan beneficiaries. Defined benefit plans must prove financial stability on a yearly basis for plan funding and reporting purposes. Reduce your defined benefit plan risk by researching applicable defined benefit plan risk articles on the Watkins Ross blog. Our Watkins Ross retirement plan team has the experience and knowledge to design your defined benefit plans to fit your business’s goals; connect with us here to learn more.
In a defined benefit plan, to receive in-service lump sum distributions at age 59 ½, the distribution must satisfy certain thresholds. Most lump sum in-service distributions for Highly Compensated Employees are contingent on the value of the plan
Common Mistakes to Avoid in Your Employee Benefit PlanManaging employee benefit plans can be a challenge. Benefits can be complicated. If you make mistakes, it could mean costly fines or even criminal punishments. Here are common employee benefit plan mistakes and...
The American Rescue Plan of 2021:Pension Plan BenefitsWill the American Rescue Plan Act of 2021 benefit your pension plan? The American Rescue Plan Act of 2021 (ARPA) became law on March 11, 2021. It contains many provisions affecting pension plans. How it will...
Impacts of the SECURE Act on Defined Benefit PlansThe market drop of December 2018 seems like ages ago, considering recent market volatility, Coronavirus, and the missing March Madness. However, the December 2018 drop did result in lower AFTAPs for many calendar-year...
The IRS released the 2020 Cost-Of-Living adjustments.
2019 IRS Operational Compliance ListAttention qualified retirement plan sponsors: The IRS has posted the 2019 IRS Operational Compliance List. The intent is to assist plan sponsors in being aware of compliance changes effective in the upcoming year with regard to...
Reducing pension plan risk has become a prudent consideration, especially for those plans that have frozen benefits. De-risk your pension plan today!
Recent class action lawsuits targeting the reasonability of actuarial equivalence factors used in defined benefit plans have been making news, what does this mean for you?
A beneficiary form determines who is entitled to the defined contribution retirement plan benefits upon the death of a participant. Is your form current?
A qualified retirement plan must meet various requirements throughout the year, check out our defined benefit compliance calendar today!
Read more about the impact the 2019 government shut down had on the lump sum interest rates.
Cash balance plans allow high-income earners to save more towards retirement than a defined contribution plan.
The census request is a tool for plan administrators to report the employee data required for annual testing and other important business changes that occurred in the prior year.
Enactment of The Tax Cuts and Jobs Act changed the way taxes are calculated for many taxpayers in 2018, including retirees receiving monthly benefits from a pension plan.
The number of new cash balance plans adopted by employers increased 15% in 2016, compared to a 1% growth in 401(k) plans.
Michigan Public Act 202 of 2017 requires local units of government to disclose information to the Michigan Department of Treasury with the intent of being more transparent to the community with the funded status and other information about their retiree health care and pension benefits.
Cash balance plans allow high-income earners to save more towards retirement than a defined contribution plan.
The PBGC (Pension Benefit Guarantee Corporation) has a new address!
Wondering how to electronically submit a federal withholding tax deposit? While it may seem daunting, the IRS has made it easy for plan sponsors to submit these payments.
Unbundled services in a defined benefit plan means the various functions are performed by separate entities, which presents advantages for employers.