Category Archives: General


2023 IRS Benefits & Contributions Limits Announced
(Posted on November 7, 2022 by )


irsOn November 7, 2022, the IRS issued IRS Notice 2022-55, 2022–45 I.R.B. 443, announcing the changes in pensions and benefits limits for 2023. With inflation higher this year than in prior years, the changes were substantial. The maximum limit on deferrals under 401(k), 403(b), and 457(b) plans rose from $20,500 to $22,500; the maximum annual additions (primarily to defined contribution plans) rose from $61,000 to $66,000; and the annual limit on compensation taken into account rose from $305,000 to $330,000. Most other limits also rose significantly.

A chart showing details, and limits from 1996 to 2023, can be found at this link.

 

 
 

New PowerPoint: New IRS Correction Rules for Retirement Plans
(Posted on October 13, 2021 by )


Strafford webinarA recent CLE webinar provided employee benefits counsel, plan sponsors, and administrators guidance on identifying critical retirement plan issues and correction methods. The panel discussed new IRS self-correction rules and procedures and the primary focus areas of IRS and DOL examinations and audits.

The PowerPoint presentation for the portion of the webinar giving a step by step guide on correcting some common 401(k) plan issues is now available at this link.

New Benefits Guide: Government and Tax-Exempt Organizations
(Posted on December 30, 2020 by )


Carol V. Calhoun has written a Benefits Guide entitled “Government and Tax-Exempt Organizations” for Bloomberg Law. The Bloomberg Law Benefits Guide is intended to be a resource for non-benefits practitioners that is easy to understand and explains complex topics in a straightforward way. Ms. Calhoun’s guide covers the types of plans maintained by governmental and tax-exempt organizations, determination of whether a plan is governmental, legal requirements and restrictions, and correction methods in case of errors in administration. The Benefits Guide is available to Bloomberg subscribers, or a copy of Ms. Calhoun’s chapter is available at this link.

New article: Section 403(b) Plan Design and Compliance
(Posted on December 5, 2018 by )


Lexis Practice Advisor articleA new article, Section 403(b) Plan Design and Compliance, discusses the rules that apply when eligible tax-exempt organizations establish tax-sheltered annuities, custodial accounts, or retirement income accounts, as described in Section 403(b) of the Internal Revenue Code (403(b) plans).

This article addresses the following topics:

Read more.

New Article: Pre-Approved 403(b) Plans
(Posted on November 29, 2018 by )


Internal Revenue ServiceIn March 2017, the Internal Revenue Service (IRS) began issuing advisory and opinion letters to the first preapproved retirement programs described in Internal Revenue Code (I.R.C.) § 403(b) (403(b) plans). A new article, Pre-Approved 403(b) Plans, discusses preapproved 403(b) plans, including their advantages, legal pitfalls, and other issues that an eligible employer may consider when determining whether to convert its existing 403(b) plan into a preapproved plan.

The major topics are:

Read more.

New Article: Nonqualified Deferred Compensation Rules for Tax-Indifferent Entities (Section 457A)
(Posted on October 26, 2018 by )


Lexis Practice AdvisorA new article, Nonqualified Deferred Compensation Rules for Tax-Indifferent Entities (Section 457A), discusses the rules that apply to deferred compensation plans maintained by certain corporations located in tax haven jurisdictions and partnerships owned by such corporations and/or by tax-exempt organizations. Topics covered include:

Read more.

Navigating Pension and Annuity Payments: General Rule and Taxation Guidelines
(Posted on December 18, 2017 by )


Lorman Distinguished Faculty MemberA 76-page PowerPoint presentation from a live Lorman Telecom webinar, “Navigating Pension and Annuity Payments: General Rule and Taxation Guidelines,” is now available by clicking here.

The webinar covered distributions from qualified plans (pension, profit sharing, stock bonus, and 401(k), including Roth accounts), IRAs (regular and Roth), and commercial annuities. Topics covered:

  • Sources of distributions (employer contributions, employee deferrals, Roths, after-tax contributions, and rollovers);
  • Restrictions on how early and how late distributions can be taken;
  • Penalties on early withdrawals;
  • Taxation of lump sum distributions;
  • Taxation of withdrawals and partial distributions;
  • Taxation of annuities and other periodic payments;
  • Plan withholding and reporting; and
  • Participant reporting.

Carol V. Calhoun Quoted in BNA Article, “IRS Rules Keep Status Quo for Many Governmental Plans”
(Posted on February 15, 2016 by )


Bloomberg BNAThe article, dealing with the proposed IRS regulations dealing with the definition of normal retirement age for governmental plans, is subscription only. However, in relevant part, it said:

The proposed rules generally were favorable, allowing plans to maintain the status quo in most cases, Carol V. Calhoun, president of the Bethesda, Md.-based Calhoun Law Group, [now Counsel at Venable LLP, Washington, DC] told Bloomberg BNA on Feb. 4.

“They say a governmental plan does not have to define normal retirement age, that it will be at whatever point you can receive a normal retirement benefit under the plan that is not reduced actuarially,” Calhoun said. For instance, the rules said that if a governmental plan says that normal retirement age is 25 years of service, then that will be considered the normal retirement age, she said.

Qualified Government Plan

A qualified governmental plan is one that is established and maintained for its employees by the federal government, a state government or political subdivision thereof, or by any agency or instrumentality of the federal or state government. The proposed rules “basically took all of the normal retirement ages that any state-wide plan has and they said all of those were going to be acceptable,” Calhoun said.

More discussion of the proposed rules can be found at this link.