MEETING THE CHALLENGES AHEAD
GETTING VALUE FROM YOUR
RETIREMENT PLANS
Ted Beal
PPG 101434 (3/15) EXP 3/17
Key Benefit Plans
State Retirement System = NJ defined benefit plan for
income
Qualified Plan Opportunities (403(b), 457, Roth, etc…)
Social Security
2 | PPG 101434 (3/15) EXP 3/17
Keys for Retirement
Keys for Retirement
1.
Review your state pension plan
- Enroll in MBOS- The Member Benefit Online System
- Understand the Financial Value of TPAF- Teachers
Pension and Annuity Fund
2.
Know Qualified Plan opportunities
3.
Review asset allocation
- Fixed Assets vs. Variable Assets
4.
Health check-up
5.
Understanding Social Security
3 | PPG 101434 (3/15) EXP 3/17
Pension Review
1. Understand value
2. Retirement: Afford it? When?
3. Options
4. Life insurance
5. Health
4 | PPG 101434 (3/15) EXP 3/17
Qualified Plan Regulations Provide ways to plan for Retirement
The Economic Growth and Tax Reconciliation Act of
2001 enhanced retirement savings options
• Increased plan limits 403(b), 457(b), + 401(a)
• Pay accumulated sick and vacation time as postretirement plan contributions
• Employer contributions
• Roth 403(b) – January 2006
Source: The Economic Growth and Tax Reconciliation Act of 2001, EGTRA
5 | PPG 101434 (3/15) EXP 3/17
Qualified Plan Options
2015 Limits
• 403(b)/ 457(b) limits
403(b) – 18,000/ 24,000/ 27,000
457(b) – 18,000/ 24,000/ 3 year catch-up
• Employee vs. Employer contributions
Overall 403(b) / (415(c)) contribution limit up to 53,000/year
(plus age 50+/$6,000)
- This includes employer and employee limits
•401(a) Limits
Source: IRS website tax code 403(b), 457(b), 401(a),
6 | PPG 101434 (3/15) EXP 3/17
Qualified Plan Options
Employer Contributions
•Employer Match – attracts + retain key administrators
•Sick and vacation 403(b) Post Retirement contributions
- Contributions can be made for 5 years after retirement
- No payroll taxes
- No income taxes until money is withdrawn from
the 403(b) plan*
* Withdrawals prior to age 59½ may be subject to an additional 10% income tax penalty.
7 | PPG 101434 (3/15) EXP 3/17
YouChoose
ChooseQualified
QualifiedPlan
PlanDesigns
Design
You
Design Plan(s) for district and personal needs:
 401(a) for benefits package
 403(b) for employee benefits and post-employment contributions
 Pair with 457(b) for double deferral or potential for pre- 591/2 access
Note: Total possible 2015 limits with all three $ 100,000+
8 | PPG 101434 (3/15) EXP 3/17
for
You
and Your
New
Opportunities
forEmployees!
You & Your Employees
Avoid “problematic” severance pay “plans”
(new guidance)
Maximize savings with multiple plans and multiple catch up
options
Convert unused leave pay to retirement benefits
Make employer contributions for up to 5 years after
employees leave
9 | PPG 101434 (3/15) EXP 3/17
Our Company
Facts about AXA Equitable
Our Company
• Over $610 billion in assets under management, as
of 12/31/2014*, in the United States.
• 15,000 public schools nationally
• 592 New Jersey Schools/ 400 NJ Municipalities
• NJ Higher Education
Source: AXA internal document growth report AUM 403(b)/457(b) plans 12/31/14
10 | PPG 101434 (3/15) EXP 3/17
Thank You!
THANK YOU
This information is not approved or endorsed by any school or state entities. AXA Advisors is
not affiliated with any school or state entity. Securities offered through AXA Advisors, LLC (NY,
NY 212-314-4600), member FINRA/SIPC. Insurance and annuity products offered through
AXA Network, LLC.
11 | PPG 101434 (3/15) EXP 3/17
Are Your 403(b) and 457(b) Plans Ready
for an IRS Audit?
Wednesday, June 3, 2015
Disclaimer
PlanConnect Disclosure
This information is provided for educational and
information purposes and is not intended to be
used to avoid tax penalties or render tax or legal
advice. The taxpayer should seek advice from an
independent tax and/or legal advisor.
March 18, 2016
13
Today’s Speaker and Agenda

Speakers
 Brayton Wicks – President
 Renea Dumas – Assistant Vice President of Operations

Agenda
 Plan Administration – What’s Expected
 IRS Audit Questionnaire – First Steps
 Compliance and Common Errors
 Helping to Avoid Compliance Issues
March 18, 2016
14
Plan Administration – What’s Expected
Plan Administration for Section 403(b) and 457(b) Plans


Role of the Administrator
 Managing the benefit for your
employees
 Ensuring compliance with the IRS
regulations around each plan
 Confirming investment providers are
qualified under IRC 457(b) and/or
403(b) and are complying with
applicable tax laws

Administration Options
 Self Administration
 Use a TPA
 Jointly with Providers

Administration Capabilities
 Systems
 Knowledge and expertise
Functions of a Plan Administrator
 Plan and Compliance oversight
 Payroll and Contribution
Remittances
 Employee Awareness
March 18, 2016
15
IRS Audit Questionnaire – First Steps
IRS Conference Questionnaire

If you Receive a Questionnaire
 Don’t ignore the questionnaire
 Complete the questionnaire on time
 Consider working with a tax
professional, legal counsel, and/or
a retirement plan professional

Who Should be Involved?
 Human resources
 Payroll
 Investment providers
 Third Party Administrator
March 18, 2016
Confidential: Disclaimer
16
Plan Compliance and Common Errors
Contributions
Responsibilities

Plan Documents
 Types of contributions permitted

Knowing the Regulations
 Annual limits, including catch-ups
 Applying years of service
 Ordering rules
 Excess contributions

Monitoring Procedures
 Roles
 Process
 Timing

Record Retention
 Maintaining copies of agreements
 Payroll records
March 18, 2016
Common Errors

Failure to Follow the Terms of the Plan

Calculating Years of Service

Excess Contributions
 Employee limit includes Roth
 15 year of service catch-up calculation
 Ordering rules when using both catch-ups
 Includible compensation – post retirement

Post-employment
 Exceeding Five Years

Distributing Excess Contributions
 Identifying and disbursing timely

Retaining Records
17
Plan Compliance and Common Errors
Distributions & Loans
Responsibilities
Responsibilities


Common Errors
Plan Documents
 Types of distributions permitted
 Eligibility rules
Knowing the Regulations
 Loans
 Hardships
 Unforeseen emergency withdrawals

Failure to Follow the Terms of the Plan

Excess Loans
 Not aggregating outstanding loan
balances across all plans and providers

Not Obtaining Supporting Documents
 Residential loan
 Hardship
 Unforeseen emergency

Required Documentation

Monitoring Procedures
 Roles
 Process

Invalid Reason for Hardship and
Unforeseen Emergency Withdrawals

Record Retention
 Maintaining all supporting
documents

Failure to Suspend and Restart
Contributions
March 18, 2016
18
Plan Compliance and Common Errors
403(b) Universal Availability
Responsibilities

Eligibility to Participate (Elective
Deferrals)
 Follow plan document provisions
 Recommend allowing all employees
(keep it simple)
 Only certain exclusions permitted under
403(b) regulations

Effective Opportunity to Participate
 Notify employees at least annually of
their ability to participate and make
changes
 New employee welcome kit
 Informational website
 Group meetings or workshops
 Periodic communications
March 18, 2016
Common Errors



19
No Supporting Documentation
 Who received the annual notice and copy
of the notice delivered, date, etc.
 Proof new employee received notice (IRS
is suggesting within thirty days of hire and
an additional thirty days to enroll)
Exclusion of Certain Classifications of
Employees
 Substitutes
 Lower paid employees – not making them
aware of their ability to participate
Entry and Election Changes
 New employee entry (giving adequate
time for new employees to enter)
 Failure to process SRAs timely
Helping to Avoid Compliance Issues
What Can a TPA Do?

Provide and Maintain Plan Documents


Compliance Oversight for Transactions
 Compliance review and sign-off
 Historical repository of supporting
documents
Universal Availability
 Annual notice and tracking
 New employee notification and tracking
 Participant education

Technical Support
 Answer regulation questions
 Inform on regulation changes

Employee and Advisor Services
 One-on-one customer service support
(bilingual in some cases)
 Regulation and plan education
 Website and online tools/calculators

Contribution Limit Testing
 Standard limits & Catch-ups

Manage Salary Reduction Agreements
 Retain SRA changes and track and
report all salary reduction changes

Remittance Management and Tracking
 Timely remittance of contributions
 Provide common remitter services
 Historical reporting

Help to Manage Investment Providers
 Information sharing across all providers
Audit Support
 Provide supporting documentation
 Procedures and work with vendors

State-of-the-Art Systems

March 18, 2016
20
Thanks and Questions
March 18, 2016
21
Appendix: 2015 Limits
March 18, 2016
22
PlanConnect, LLC is a wholly owned subsidiary of AX A Distribution Holding Corporation, an indirect subsidiary of AXA Financial, Inc.
PlanConnectSM, Connect2ComplySM, Connect2MaintainSM, Connect2RemitSM and Connect2AchieveSM are service marks of AX A Distribution
Holding Corporation. PlanConnectSM may not be available in all states. AXA Financial, Inc. and its family of companies do not provide tax advice.
Please consult with your tax advisor regarding your particular circumstances. Each company is affiliated. AXA Distribution Holding Corporation
and AXA Financial, Inc. are located at 1290 Avenue of the Americas, New York, NY 10104, 212.554.1234.
PlanConnect,
March 18, 2016
LLC
is
located
at
100
Madison
Street,
23
Syracuse,NY
13221.
800.923.6669