RD News & Resources
401(k) Compliance Calendar - Key Dates
This compliance calendar offers a summary of key dates for your 401(K) plan.
The dates provided are set by the IRS. In order to ensure compliance with the regulations, we ask that you help us by returning requested information in a timely manner.
IRS Announces 2016 Pension Plan Limitations
Taxpayers May Contribute up to $18,000 to their 401(k) plans in 2016 and an additional $6,000 of catch-up deferrals if age 50 by 12/31
The Internal Revenue Service announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items. Pension limitations such as those governing 401(k) plans and IRAs will remain unchanged because the increase in the Consumer Price Index did not meet the statutory thresholds for their adjustment. Pension plan limitations are subject to change on an annual basis.
Retirement Readiness Solution
- Web site interface for participants to personalize their retirement readiness strategy
- Annual report to participants for a call to action
- Annual Report to plan sponsor showing demographic information related to the retirement readiness of their participants
Case Study – Retirement Benefits Program
PROFILE
• Private Company
• 150 employees
• Previous record keeper failed to keep the plan compliant
OVERVIEW
401(k) plans are subject to a multitude of regulations and testing with which they must adhere. To make matters more difficult complicated tax laws and reporting requirements add additional pressure and workload to a plan sponsors already busy day. These requirements have made it increasingly difficult for plan sponsors to focus on other more pressing aspects of their roles by devoting valuable time to resolve these complicated issues. As is often the case, plans look to their retirement plan administrator and recordkeeper to administer and help provide assistance in testing, filing of proper tax documents, provide plan reporting and help keeping their plan compliant.
Case Study – Challenges with internal recordkeeping staff
PROFILE
• Bank Trust Department
• 50 retirement plans
• 4,500 employees
• Bank had a staff of 5 performing internal recordkeeping functions
THE CHALLENGE
The bank trust department had been providing retirement plan services to their market place for 20 years. They developed the service model with an internal staff to perform recordkeeping and operational functions. As the bank grew over the years, they had placed a large amount of responsibility on one individual. Unfortunately, that key staff member accepted a position with another firm and only gave the bank two weeks’ notice during the busy compliance season. The other members of the recordkeeping staff while capable from a support perspective, did not have the level of expertise and experience required to maintain the operation. Once the key staff member left, the service levels dropped off resulting in errors that cost the bank significant losses and an increase in plan sponsor complaints!
