Defined benefit plan

The IRS has issued Notice 2021-48, providing guidance about changes to the funding rules for single-employer defined benefit pension plans that were made by the American Rescue Plan Act of 2021 (ARPA). ARPA included provisions that addressed amortization relief by allowing existing shortfall amortization bases to be reduced to zero and extending funding shortfall installments for new shortfall bases to 15 years. In addition, ARPA amended segment rate minimum and maximum percentages and created an interest rate “floor” of five percent in a period of lower interest rates. These provisions are to be applied to all plans with plan years beginning in 2022 and, by election, may be adopted sooner.

Senators Rob Portman (R-OH), and Ben Cardin (D-MD), have introduced the Retirement Security and Savings Act of 2021, legislation that was last introduced in 2019. This bill, like the Securing a Strong Retirement Act introduced in the House of Representatives earlier this month, is intended to build on the Setting Every Community Up for Retirement Enhancement Act (SECURE) of 2019. With more than 50 provisions, this bill contains a broad set of retirement reforms under the following categories, highlights of which are enumerated below.

House Ways and Means Committee Chairman Richard Neal (D-MA) and Ranking Member Kevin Brady (R-TX) have introduced the Securing a Strong Retirement Act (SSRA) of 2021, legislation that was first introduced in October 2020. It builds upon the Setting Every Community Up for Retirement Enhancement Act (SECURE) Act of 2019. The House Ways and Means Committee held a markup hearing Wednesday, May 5, and unanimously voted to advance this legislation to the full House of Representatives to vote on the measure.

The IRS has issued a news release announcing the postponement of certain tax-related deadlines for Alabama victims of severe storms, straight-line winds, and tornadoes. The tax relief postpones various tax filing and payment deadlines that occurred starting on March 25. The areas included in the relief are Bibb, Calhoun, Clay, Hale, Jefferson, Perry, Randolph, and Shelby counties.

The IRS has issued a news release announcing the postponement of certain tax-related deadlines for Kentucky victims of severe storms, flooding, landslides, and mudslides. The tax relief postpones various tax filing and payment deadlines that occurred starting on February 27. The areas included in the relief are Boyd, Breathitt, Carter, Casey, Clay, Cumberland, Elliott, Estill, Floyd, Franklin, Jackson, Johnson, Knott, Knox, Lawrence, Lee, Lincoln, Magoffin, Marion, Martin, Mason, Morgan, Ohio, Pike, Powell, Rockcastle, and Wolfe counties.

Objective investment advice. Simple concept, right? And most everyone agrees that every saver and retirement investor is entitled to this. But ensuring that individuals have access to objective investment advice is easier said than done. In fact, the Department of Labor (DOL) has been trying to make this happen since the 1970s, when it first released a five-part test to help determine whether investment professionals owed their clients a duty to provide objective advice.

Recent cyberattacks have gotten a lot of attention. Some of these hacks have created turmoil through a broad swath of the business community. But another widespread menace threatens our financial security. In fact, even as you read this, the global threat of cybercrime continues around the clock as criminals try to steal retirement plan assets.

A proposal to extend the Paycheck Protection Program (PPP) through the end of May has passed the Senate by a vote of 92-7. The PPP was set to expire on March 31, 2021, just weeks after changes were made to expand availability to certain small businesses. The House had voted earlier this month to pass the bill, and it now heads to the President for signature.

President Biden has signed legislation that funds another round of assistance as the nation copes with the health and economic effects of the coronavirus pandemic. Several previous bills in 2020 provided direct cash benefits to Americans, created a small business lending program to help employers retain employees, and provided enhanced access to tax-favored retirement savings.

President Biden has signed into law the American Rescue Plan Act one day after the House of Representatives voted to pass the amended package. Several provisions directly affect tax-advantaged savings arrangements.