Many types of businesses are turning towards employee ownership as a succession planning tool and as a way to incentivize employees. Industries that can benefit from employee ownership plans include architecture and design firms, construction companies, and defense contractors, among others. Whil...
Employee Stock Ownership Plans (ESOP) provide a unique business ownership structure that allows employees to have a stake in the company they work for. ESOPs offer additional benefits for the overall success of the company, as well as for the owners selling shares in the company. Certain types of...
An Employee Stock Ownership Plan (ESOP) is a qualified defined contribution retirement plan that primarily invests in common company stock. These shares are held in an ESOP trust until the employee leaves the company or retires. At that point, the shares are bought back by the company. Many clos...
In general, Employee stock ownership plans (ESOPs) can be a benefit to owners, employees, and the company overall. ESOPs provide a unique way for employees to gain an ownership interest in their company and set aside retirement savings. However, ESOPs can also present some problems and complicati...
Department of Labor (DOL) investigations into fiduciary breaches in ESOPs can result in significant civil liability, penalties, and even possible criminal charges. The majority of these investigations are triggered by civil lawsuits, whistleblowers, or participant complaints, but a small handful ...
A 403(b) plan derives its name from the Internal Revenue Code (IRC) Section 403. 403(b) plans are generally only available for certain employees of public schools, employees of cooperative hospital service organizations, employees of 501(c)(3) organizations, and certain ministers. A 403(b) retire...
The proposed implementation of changes in the Best Interest Contract Exemption and fiduciary rules will be further delayed until January 1, 2019. Previously, the transition period extended from June 9, 2017, to January 1, 2018. According to the Department of Labor, the extended delay will give th...
Many businesses put a lot of time and effort into initially setting up company retirement plans. Unfortunately, they do not regularly revisit the plans to ensure they are staying in compliance with ERISA and federal regulations, or do not take into account governmental policy changes. A Departmen...
The IRS Voluntary Correction Program allows companies to correct mistakes with their retirement plan before they face an audit. Compliance can allow the plan to maintain tax-favored status and avoid costly penalties. The IRS has published the “Top Ten Failures Found in Voluntary Correction Progra...
When most plan participants think about security involving their retirement plan, they are typically thinking along the lines of financial security and how their investments perform. However, like other financial institutions, retirement accounts are subject to cyber threats that could threaten u...
In April of 2017, the ERISA Advisory Council on Employee Welfare and Pension Benefit Plans announced a review of ERISAs required disclosures and notices. The Council sought input from stakeholders on a number of topics, in part, to determine if current ERISA requirements should be amended or mod...
A 403(b) plan is named after the Internal Revenue Code (IRC) Section 403, which details the plan. Essentially, a 403(b) plan is a retirement plan that allows employees to make contributions on a pre-tax basis, similar to a 401(k) plan. 403(b) plans sponsored by governmental and public education e...
Many companies offer retirement benefit plans to their employees. However, standardized retirement benefit plans may not have the same appeal to executives as they would to regular employees. Executives are increasingly offered targeted retirement benefits that benefit both the company and the ex...
Check out my article published in the September/October 2017 edition of NALA's Facts & Findings magazine!
Dealing with complex federal regulations, like ERISA, is anything but simple. However, there are some important things for plan administrators, employers, and Plan Participants to know about when facing the possibility of ERISA litigation. When the potential for litigation over an ERISA plan aris...
Mediating ERISA disputes has unique challenges compared to mediating other types of civil claims. Some attorneys representing the employer use mediation as a way to flex their litigation muscle, coming down hard on the employee. However, mediation should be used as a way to resolve a complaint be...
Failure to Maintain Plan Documentation It is important for plan sponsors to have a general understanding of their fiduciary responsibilities to plan participants. These include making sure to avoid conflicts of interest, diversifying investments, and acting in the best interests of plan particip...
There are a number of benefits associated with employee stock ownership plans (ESOPs) for companies. In general, an ESOP can be a benefit to owners, employees, and the company overall. However, ESOPs can present some problems and complications. Understanding the potential pitfalls of an ESOP can ...
Acting as a fiduciary for a qualified retirement plan involves a number of important responsibilities. However, making even simple fiduciary decisions can have serious consequences. Failing to follow best practices may leave a fiduciary personally liable for losses to the plan and result in remov...
The Supreme Court has offered some guidance and clarification on the fiduciary standards for Employee Stock Ownership Plans (ESOPs). After the 2014 Dudenhoeffer decision, ESOP fiduciaries lost their presumption of prudence that protected most ESOP fiduciary decisions. However, the Court also rais...
Opinion letters provide determinations as to the qualification of retirement plans as adopted by employers. The IRS recently released Rev. Proc. 2017-41, setting forth the procedures for issuing Opinion Letters regarding the qualification of certain pre-approved retirement plans. These changes ar...
Many common retirement savings plans are subject to required minimum distributions (RMDs). This includes traditional IRAs, SEP and SIMPLE IRAs, as well as 401(k)s, 403(b)s, and other defined contribution plans. Once youve reached the mandatory age for taking withdrawals from your IRA or retireme...
There are a number of retirement plans offered by employers, including pension, profit sharing, and 401(k) plans. While many companies offer 401(k) or 403(b) retirement plans, the lesser known 457 plans provide an alternative retirement plan option for many governmental and non-profit employees. ...
Earlier this month, we wrote about ESOPs as a succession planning tool for construction company owners. However, there are a number of other reasons why construction and manufacturing companies are turning to ESOPs beyond succession planning. An Employee Stock Ownership Plan (ESOP) is a qualifie...
In addition to the many other local, state, and federal filings, businesses with benefits plans may be required to file an annual Form 5500 to report their pension and welfare plans' financial condition, investments, and operations. Late filings, unfiled reports, and incomplete filings can expose...
We help establish a customized plan that meets regulatory requirements as a tax qualified plan. Following implementation, our attorneys can assist clients and their plan administrator with regular reviews and updates to help with regulatory compliance for the plan's operation, and continued effectiveness in meeting the client's specific goals.
We are dedicated to employee ownership. When you come to us for ESOP services, you receive influential legal counsel who stand beside you to help you stay informed, in compliance, and abreast of the latest developments-all to help you realize your plan goals as fully and effectively as possible.
A QDRO is a specially designed court order that is required for the division of retirement benefits in a family law case. Many family law attorneys do not possess the expertise necessary to divide retirement benefits or stock options upon divorce. We have extensive experience in dividing qualified plans, government plans, IRAs and stock options between the employee spouse and non-employee spouse.