Legislative Updates

Changes in legislation or regulations may affect your retirement plan. Keep up-to-date on the latest developments by reading the article summaries below. You can read full versions of the articles by visiting the Legislative Ledger section of the Transamerica Center for Retirement Studies.

Supreme Court Rules That Individuals Can Sue for Breach of Fiduciary Duty
On Wednesday, February 20, the United States Supreme Court ruled that individual participants in 401(k) plans can sue for fiduciary breach under ERISA, vacating prior court opinion. Learn More.

The Pension Protection Act of 2006
On August 17, 2006, President Bush signed the Pension Protection Act of 2006. This landmark legislation
provides the legal framework for defined contribution plans that will enable plan sponsors to maximize the
effectiveness of their retirement plan and help their plan participants with building their nest eggs in preparation
for retirement. The Transamerica Center for Retirement Studies has prepared a summary of the new law.

TRS Update Regarding Market Timing and Redemption Fees
On March 3, 2005, the Securities and Exchange Commission (SEC) adopted Rule 22c-2 under the Investment Company Act of 1940. This rule is structured to curb the market timing and frequent trading abuses that occurred during the preceding several years in the mutual fund industry. For an update on Transamerica's position regarding this rule, please click here.

A Summary of the Final Rules On Deemed IRAs in Qualified Retirement Plans
The IRS just released final regulations providing guidance to plan sponsors who wish to include IRAs as part of their qualified plan (Deemed IRAs).  At the same time, the IRS issued proposed and temporary rules for governmental units to qualify as non-bank trustees for Deemed IRAs.  The final regulations were originally proposed in May 2003, and apply to deemed IRAs established on and after August 1, 2003. Click here for more information.  


IRS Final Regulations for 401(k) Plan Loans, Effective for Plan Loans Made On or After January 1, 2004
Initially proposed on July 31, 2000 and finalized on December 3, 2002, the following regulations have been changed concerning: loans, suspension of loan repayments during leave of absence for military service, loans after a deemed distribution, loan refinancing, and multiple loans. Click here for more information.

Final Regulations on Catch-Up Contributions
The IRS issued final regulations for Catch-Up Contributions on July 7, 2003.  These final regulations clarify the definition, determination, and administrative treatment (including distribution restrictions, vesting, and non-discrimination testing) of Catch-Up Contributions. Click here for more information. 

Proposed 401(k) Consolidation Regulations (Including Bottom-Up QNECS)
The IRS just issued long-awaited proposed 401(k) consolidation regulations which combine all existing guidance and various pieces of legislation affecting 401(k) plans into one comprehensive document. Click here for more information. 

Status of Pension Preservation and Savings Expansion Act of 2003 (H.R. 1776)
In April, Congressmen Rob Portman (R-OH) and Benjamin Cardin (D-MD) introduced new retirement security legislation. On July 18, 2003, the House Ways and Means Committee marked up the bill and published a scaled-down version. Click here for more information.

EGTRRA
The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) was signed into
law by President Bush on June 7, 2001. This legislation touches is designed to increase retirement savings for all Americans. For more information, click here.