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Regulation Orgs.
Organizations That Regulate Retirement Plans
Question | Answer |
---|---|
Employers who are exempt from ERISA & other key legislation | Church and Government |
(PPA) Pension Protection Act of 2006 | Made EGTRRA provision permanent. Added EACA&QACA. Eliminated the 7-year graded & 5-year cliff vesting schedules. Allowed for reservists distributions. Changed 5500 filing by requiring electronic filing. Req'd benefit statements to be provided Quarterly |
(ERTA) Economic Recovery Act of 1981 | Allowed voluntary contributions to qualified plans. These are deposits that you may otherwise put in a savings account or your credit union. |
(ERISA) Employee Retirement Income Security Act of 1974 | First major piece of pension reform legislation. Laid down guidelines for reporting info retirement plans to the IRS & fiduciary requirements for retirement plan sponsors. Established the IRA concept. |
What are the two organizations that regulate retirement plans? | DOL (Dept. of Labor) & IRS (Internal Revenue Service) |
What is a retirement plan? | An entity that is established by an organization to help provide money for employees in retirement. |
TEFRA - Tax Equity & Fiscal Responsibility Act (1982), DEFRA - Deficit Reduction Act (1984), REA - Retirement Equity Act (1984) | Created minimum distribution requirements. Treated certain plan loans as taxable distributions. Added spouse/joint consent requirements. Lowered minimum age for eligibility from 25 to 21. |
Unemployment Compensation Amendment of 1992 | Added the requirement that certain distributions from qualified retirement plans be subject to a 20% withholding. The purpose of this was to encourage people to leave money in a retirement savings arrangement, like a retirement plan or IRA. |
Tax Reform Act of 1986 | Substantially affected retirement plans by: New coverage & participation requirements. Added "non-discriminating" testing. Changed the taxes on benefits paid from retirement plans. |
(TRA) Taxpayer Relief Act of 1997 | Increased the small amounts force-out limit from $3,500 to $5,000. |
Small Business Job Protection Act of 1996 a.k.a. Pension Simplification | Makes retirement plan administrating easier for the plan sponsor. Allows tax-exempt organizations (other than govs) to establish a 401(k) plan. Changes in 401(k) procedures. Changes in the highly compensated definition. Added SafeHarbor 401(k) plans. |
Budget Reconciliation Act of 1993 | This law reduced the compensation limits from $235,840 to $150,000. These contributions were used to determine benefits & contributions to a qualified retirement plan. |
(EGTRRA) Economic Growth & Tax Relief Reconciliation Act of 2001 | Increased annual limits on 401(k), 403(b) & 457(b) contributions (deferrals). Increased dollar limit for 415 purposes. Allowed "catchup" contributions for age 50+. Accelerated vesting schedules for match contributions. |