Recent Pension Laws Clarify Non-Qualified Plan Issues

(Capistrano Beach, CA) National Retirement Partners, LLC, a national retirement plan advisory firm with more 79 Member Firm locations, and The Baker Companies, an Affiliated Member Firm of NRP based in Wellesley, MA, announced today the release of a special White Paper Report discussing pension related legislative changes, the impact on Non-Qualified Plans and the use of COLI as a funding vehicle.

Available to NRP Members, the White Paper Report includes seven key provisions relating to new guidelines imposed with the Pension Protection Act of 2006, the American Jobs Creation Act of 2004 (AJCA) and the subsequent new tax code, 409A.

According to the Report “The AJCA legislation impacts non-qualified plans. 409A impacts all deferred compensation plans and deferrals made in 2005 or later”.

The White Paper Report also outlines three significant changes for companies that utilize COLI as a result of the recent passing of the Pension Protection Act, referred to as “COLI Best Practices”.

“Companies can now follow a specific set of rules and know that they are complying with federal regulations regarding the design and administration of their Non-Qualified Plans”; said Rick Hansen, President of The Baker Companies.

“While most of the focus of the Pension Protection Act has been on the impact to qualified plans, especially defined benefit plans, significant changes were made to how companies may utilize life insurance in the funding of their liabilities”; stated Robert Francis, chief operating officer at National Retirement Partners.