Previously, if a participant received a disability pension benefit, MERS contacted the participant to verify their income annually. If the money earned exceeded their income limitation, the participant’s pension amount was reduced in excess of the limitation. In response to customer feedback that this can be a burdensome process, and after a review of the… Continue reading
The MERS Retirement Board recently approved adding a default provision to the DC forfeiture rules. This means that if action is not taken to utilize forfeiture funds by the required deadline, funds will automatically be distributed as an equal share to any active participant in that DC plan. This ensures that employers remain in compliance… Continue reading
The timeframe you in which you must use forfeiture funds from your defined contribution plan has been extended. As a reminder, in years prior, the MERS Plan Document required employers to utilize DC forfeiture funds in the plan year in which they occurred. Effective January 1, 2024, the IRS will allow forfeitures to be used… Continue reading
Reduction in excise tax on RMDs Reduces the penalty for failure to take an RMD from 50% to 25%. Further, if a failure to take an RMD from an IRA is corrected in a timely manner, as defined under SECURE 2.0, the excise tax on the failure is further reduced from 25% to 10%. This… Continue reading
Required minimum distribution (RMD) age changes Increases the required minimum distribution (RMD) age from 72 to 73 for individuals who attain age 72 after January 1, 2023, and age 73 before January 1, 2033. Further, there is a subsequent increase to age 75 for any individual who did not attain age 74 prior to January… Continue reading
On December 1, 2022, The MERS Retirement Board approved changes to Sections 6(5), 6(6) and 50(2)[a] of the Plan Document to include amendments relating to employee transfers/rehires for “cash or deferred arrangement” (CODA) prohibition compliance. Per a recent IRS ruling, any benefit option that presents an employee with a choice between cash or deferred compensation after… Continue reading
In an effort to proactively offer employers options to help meet their unique financial needs and manage the affordability of their MERS plans, the MERS Plan Document was revised to allow more options to employers to close or freeze their current MERS retirement plan and choose a different retirement plan style for their current and/or… Continue reading