28, Raymond James says, it will add "additional language [to its] mutual fund B and C share policies regarding the use of appropriate sales charge waivers for eligible clients, including
qualified plans and charitable trusts."
Restoration plans "restore" benefits that cannot be paid due to statutory limits on
qualified plans, while SERPs typically offer enhanced benefits compared with
qualified plans.
"With regard to the proposed regulation, we are concerned that it could affect a wide variety of common practices that our members use to provide and protect the retirement income of disabled employees under
qualified plans," said Lyn Dudley, vice president of retirement policy for the council in its comment letter.
In recent years, many companies have transferred executives' retirement benefits from nonqualified to
qualified plans, using a technique commonly known as a "supplemental executive retirement plan (SERP) shift." Doing so provides the executives with greater financial security and more favorable financial treatment, and also often results in tax and accounting benefits for the employer.
Some participants in
qualified plans, upon becoming entitled to receive a plan distribution by virtue of their separation from service or their age or other plan rules, chose to leave their accounts with a
qualified plan trustee, even though they might have preferred an IRA rollover, simply because they thought that the
qualified plan offered greater protection against claims of creditors.
Although traditional IRAs and Roth IRAs are granted limited protection under BAPCPA (generally not to exceed $1,000,000),
qualified plans and certain other retirement arrangements such as 403(b) arrangements and 457 plans are granted unlimited protection under the act.
There is, however, a $1 million ceiling on the protection for amounts held in IRAs, except for amounts rolled over from
qualified plans.
As public companies have struggled to comply, private companies--in particular, those with
qualified plans, also have found themselves within SOX's reach.
Mark West, director of Advanced Solutions, said a 412(i) plan is a "sound choice" for business owners who invested heavily in their businesses in early years and who want to catch up with contributions greater than limits imposed by other
qualified plans. He said it would be appropriate for conservative savers who are approaching retirement in the next 10 to 15 years.
* conforming the IRS's administration of the tax laws relating to
qualified plans to general statute of limitations principles and the administration of other provisions of the Code;
Qualified plans are governed by the Employee Retirement Income Security Act (ERISA) and must be offered to all employees.
* Step 1 -
Qualified Plans: If the company currently has a qualified retirement plan in place, such as a 401(k), evaluate its pros and cons.
