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Hacienda Extends Deadlines to Comply with the Puerto Rico Internal Revenue Code of 2011

Hacienda extended the deadline for plans to be amended to comply with the Puerto Rico Internal Revenue Code of 2011. The original amendment deadline was the last day of the first plan year beginning on or after January 1, 2012. For calendar year plans, the deadline would have been December 31, 2012. The new deadline is the later of June 30, 2013, or the last day of the first plan year beginning on or after January 1, 2012. In addition, the deadline to submit a ?Ç£Request for Qualification?Ç¥ letter was extended to the later of September 30, 2013, or the due date to file an income tax return of the employer, with extensions, for the first taxable year that begins on or after January 1, 2012. Finally, the ?Ç£Request for Qualification?Ç¥ with regard to a plan?ÇÖs qualification under the Puerto Rico Internal Revenue Code of 1994 must be submitted with… Continue Reading

Department of Labor Proposes Rule to Speed Distributions to Participants of Plans Sponsored by Bankrupt Companies

The U.S. Department of Labor?ÇÖs Employee Benefits Security Administration announced a proposed rule that would expand its Abandoned Plan Program to include individual account plans, including 401(k) plans, of companies in Chapter 7 bankruptcy (a ?Ç£Chapter 7 Plan?Ç¥). Under the current rule, only large financial institutions and other asset custodians can serve as administrators of abandoned plans, and a plan is considered abandoned only after no contributions or distributions have been made for at least 12 months. Under the proposed rule, a Chapter 7 Plan would be considered abandoned on the date the plan sponsor?ÇÖs bankruptcy proceeding commences. A bankruptcy trustee, or its designee, could then take advantage of the Abandoned Plan Program?ÇÖs streamlined plan termination and benefit distribution procedures. As a result, plan participants would likely see fewer administrative and termination fees charged to their accounts and could receive benefit distributions more quickly. Additionally, the proposed rule permits a… Continue Reading

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