Compliance December 11, 2014

IRS Weighs In on What Records to Keep

An updated page on the IRS website shares what records retirement plan sponsors should keep and for how long.
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The Internal Revenue Service (IRS) notes that retirement plan sponsors are required by law to keep books and records available for review by the agency.

On an updated web page, “Maintaining Your Retirement Plan Records,” the IRS says saving these records will also facilitate answering questions when determining participants’ benefits.

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Plan sponsors should keep the plan and trust document, recent amendments, determination and approval letters, related annuity contracts and collective bargaining agreements.

The records kept are based on the type of plan sponsored. For example:

  • SEP Plans should keep Form 5305-SEP or 5305A-SEP as the plan document;
  • SIMPLE IRA plans should keep Form 5304-SIMPLE or 5305-SIMPLE as the plan document; and
  • Profit sharing, 401(k) or defined benefit plans should keep the plan document, adoption agreement (if there is one) and all plan amendments.

The IRS also says plan sponsors must keep trust records such as investment statements, balance sheets, and income statements, as well as participant records such as census data, account balances, contributions and earnings, loan documents and information, compensation data and participant statements and notices.

Retirement plan records must be retained until the trust or IRA has paid all benefits and enough time has passed that the plan will not be audited. However, the IRS notes that retirement plans are designed to be long-term programs for participants to accumulate and receive benefits at retirement. The Internal Revenue Code and Income Tax Regulations as well as the Employee Retirement Income Security Act (ERISA) require plan sponsors to keep records of these transactions because they may become material in administering pension law.

Some law firms have reported they are seeing a growing number of claims for pension benefits that were paid or rolled over decades ago by former employees who either do not recall receiving or rolling over their benefits or who are questioning the amount of benefits they received.

Diversions December 11, 2014

Most Annoying Fellow Air Travelers

Rear-seat kickers have displaced inattentive parents as the most annoying fellow travelers on airlines, according to the latest “Expedia Study of In-Flight Etiquette.”
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The study, which asked 1,000 Americans to rank the most annoying on-board behaviors of other passengers, also noted smelly passengers, the “audio insensitive,” heavy drinkers and loud, ceaseless talkers.

More than three in four (78%) Americans surveyed agree that “a little small talk is fine, but I prefer to keep to myself during the flight.” Relatively few (16%) use flights as an opportunity to talk with and meet new people, and 65% “dread” the experience of sitting next to a Chatty Cathy.

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Only 12% report that they drink more than two alcoholic beverages during air travel, while on board or in the airport. About one in seven (15%) “always or sometimes” use medication or alcohol to help them sleep on a plane. Four out of five also report that they generally cannot sleep on planes.

In the wake of this year’s headline examples of in-flight fights spurred by perceived legroom violations, the survey reveals that 32% of men do not recline their seat, compared with 38% of women. Almost a third (31%) of passengers recline their seats to sleep, with 26% saying they do so when the flight lasts longer than three hours. More than one in 10 (12%) recline immediately after take-off; the same percentage of fliers do so if the person in front of them does.

A full 10% reported that they would recline their seat even if the passenger behind them was noticeably pregnant. More than half (55%) of U.S. flyers do not ask permission of the passenger behind them. More than a third (38%) believe reclining should be banned or at least restricted.

The research also covered the most annoying co-passengers:

  1. Rear-seat kickers (cited by 67% of respondents)
  2. Inattentive parents (64%)
  3. The “aromatic passenger” (56%)
  4. The “audio insensitive,” including either talking or music (51%)
  5. The boozer (50%)
  6. “Chatty Cathy” (43%)
  7. Carry-on baggage offenders (39%)
  8. The armrest hog (38%)
  9. The seat recliner (37%)
  10. The “queue jumper” who rushes to deplane (35%)
  11. The “overhead bin inconsiderate” who stows a bag in the first available spot rather than in one nearest to his or her seat (32%)
  12. “Pungent foodies” (32%)
  13. Grabbers of your seat back (31%)
  14. The “playboy” who reads or watches adult content (30%)
  15. Showers of inappropriate levels of affection (29%)
  16. The window seat passenger who makes repeated bathroom visits (28%)
  17. The “undresser” who removes shoes, socks or more (26%)
  18. The “seat switcher” (13%)

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