Products October 17, 2018

Wolters Kluwer Streamlines Distribution Process with Tracking Software

Along with other features, the software can automate tasks usually performed manually. 

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Wolters Kluwer Legal & Regulatory U.S. has launched a tracking software designed to streamline qualified plan participant distributions, available for ft.william.com.

Designed with retirement service providers in mind, the Distribution Tracking Software (DTS) looks to simplify the procedure of planning distributions by automating tasks typically completed manually and offer accountability tools, data collection, and communication. Additional features include global and plan level dashboards; document exchange portals, where providers can download, send and receive forms from plan sponsors and participants; batch import distributions for force outs, plan termination and conversion; batch print and attach custom documents to distribution records; and more, according to the firm.

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The DTS module joins other ftwilliam.com programs, including 1099, Compliance and Documents. More information about the software can be found here.   

Compliance October 17, 2018

IRS Identifies Retirement Plan Compliance Strategies for 2019

The agency will give greater scrutiny to retirement plan distributions and 403(b) universal availability rules, among other things.

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A Program Letter from the Tax Exempt & Government Entities (TE/GE) Business Operating Division of the IRS offers a heads up to what retirement plan sponsors can expect from the IRS in 2019.

Strategies approved for the Employee Plans (EP) division include:

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  • Distributions: verify that plans are following correct distribution processes and procedures and that participants are receiving correct distribution amounts;
  • Form 5500, Annual Return/Report of Employee Benefit Plan, and Form 5500-SF, Short Form Annual Return/Report of Small Employee Benefit Plan, stop filers: contact employers sponsoring plans that did not file one or more required returns;
  • IRC Section 403(b)/457 plans: examine 403(b) plans for universal availability, excessive contributions and proper use of catch-up contributions under IRC Section 414(v); and 457(b) plans for excessive contributions and proper use of the special three-year catch-up contribution rule;
  • Small plans with large assets: determine whether smaller plans with trusts holding large assets have taken deductions on Form 1120, U.S. Corporation Income Tax Return, exceeding IRC Section 404 limitations;
  • Simplified Employee Pension (SEP) plans: determine whether accounts violated maximum participant rules, failed to meet statutory and matched employer contribution requirements, and/or failed to meet IRC Section 416(i)(6) top-heavy requirements; and
  • Terminated cash balance plans: examine terminated plans with cash balance features that may have exceeded IRC Section 415 limitations or generated a reversion which is subject to an excise tax.

Strategies approved specifically for tax-exempt organizations include:

  • Previous for-profit: focus on organizations formerly operated as for-profit entities prior to their conversion to Internal Revenue Code (IRC) Section 501(c)(3) organizations;
  • Self-dealing by private foundations: focus on organizations with loans to disqualified persons;
  • Early retirement incentive plans: determine whether federal, state or local governmental entities that provide cash (and other) options to employees as an incentive for early retirement have applied proper tax treatment to these benefits; and
  • Worker classification (misclassified workers): determine whether misclassified workers result in incorrectly treating employees as independent contractors.
“As more issues are developed and approved, those with a higher priority may potentially replace Compliance Strategies currently set forth in this document,” the Program Letter states.

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