The Internal Revenue Service has released a detailed list of pension plan and other retirement-related contribution limitations for Tax Year 2013 that were triggered by increases to the cost of living. A number of the pension plan limitations will change for 2013 because the increase in the cost-of-living index met the statutory thresholds for the adjustment. Other limitations, however, will remain unchanged.
Articles about the Employee Retirement Income Security Act (ERISA) and other issues relating to employee benefit topics
Legal Alert: IRS Announces 2013 Cost-of-Living Increases to Pension Plan Limits
On October 18, 2012, the Internal Revenue Service announced cost of living adjustments affecting various limitations applicable to pension and other retirement plans (IR 2012-77). Many of the limitations remain unchanged because they are indexed in $1000 or $5000 increments, but several will change for 2013. Some of the better-known limitations are:
Legal Alert: Calendar Year Plans Need to File Form 5500 by July 31, 2012
Executive Summary: The Form 5500, Annual Return/Report of Employee Benefit Plan, is used to report information concerning employee benefit plans and must be filed by the last day of the 7th calendar month after the end of the plan year, which is July 31, 2012 for calendar year plans.
Legal Alert: Supreme Court Upholds Health Care Reform Law
Today, in a 5-4 decision, the U.S. Supreme Court upheld the individual mandate provision of the 2010 Patient Protection and Affordable Care Act (PPACA) as a valid tax, imposed within Congress’ taxing power. See Nat’l Federation of Independent Businesses v. Sebelius (No. 11-393, June 28, 2012)[1]. The Court held that the individual mandate (which requires most Americans to purchase insurance or face an IRS tax) is not a penalty because the only consequence of not complying with the mandate is the requirement to pay the tax. Although the Court also held that Congress exceeded the power granted to it under the Commerce Clause when it enacted the individual mandate, the provision is nevertheless valid under Congress’ taxing authority. The Court also held that the Anti-Injunction Act does not preclude the Court from ruling on the issue because the PPACA does not require that the penalty for failing to comply with the individual mandate be treated as a tax for the purposes of the Anti-Injunction Act. Chief Justice Roberts authored the majority opinion.
Prearranged Rehire of Retirees Could Disqualify Your Pension Plan
As an employee reaches retirement age, he may want to retire or cease working full-time. The employer, however, may need or want the employee to continue to work temporarily or on a part-time basis. The employee wants to begin to receive his pension plan payments. A frequent question in this scenario is, “Can we employ the participant part-time or for a few more months, but begin the employee’s pension payments?â€