American Benefits Council
Benefits Byte


May 5, 2015

The Benefits Byte is the American Benefits Council’s regular e-mail and online newsletter for members only, providing timely reports on legislative, regulatory and judicial developments, along with updates on the Council’s activities in support of employer-sponsored benefit plans.

The Benefits Byte is published by the American Benefits Council, based on staff reports and edited by Jason Hammersla, Council director of communications. Contact information for Council staff related to specific topics can be found at the end of each story.

Click here to read past issues on the Benefits Byte Archive page.

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Council Requests Additional Time to Review, Comment on Fiduciary Definition Proposal

The Council has urged the U.S. Department of Labor (DOL) Employee Benefits Security Administration (EBSA) to extend the comment deadline for its proposed regulations defining the term “fiduciary” with respect to employee benefit plan investment advice.

As stated in its May 5 letter, the Council “appreciates the importance of this project and wants to ensure that our membership has adequate time to fully analyze the impact of the proposed guidance and provide the information and input the Department has asked for in the reproposal.”

The proposed regulations, issued on April 14 along with a fact sheet, a series of Frequently Asked Questions and a series of proposed prohibited transaction exemptions, broadly updates the definition of fiduciary investment advice by extending fiduciary status to a wider array of advice relationships than existing rules. The proposal provides for a comment period of 75 days (starting with the formal publication of the proposal on April 20), making the due date July 6. (See the April 14 Benefits Byte for a brief summary of the proposal.)

The rule was first proposed by the EBSA in October 2010 (see the October 21, 2010, Benefits Byte) but was later withdrawn due to concerns raised by the business and financial communities, as well as lawmakers from both parties. The Council identified several key areas of concern for plan sponsors in February 3, 2011, written comments. The Council’s letter notes that “the new package is significantly longer and more complex than the original proposal and the 2010 proposal had a longer comment period.”

The Council is already undertaking a thorough review of the proposal itself, as well as the prohibited transaction exemptions and the economic analysis being used to support the issuance of new rules. We are also scheduling a Benefits Briefing webinar for early June to collect additional feedback from the membership.

It is uncertain whether EBSA will grant an extension. EBSA’s Assistant Secretary of Labor, Phyllis Borzi, was recently quoted as saying that the agency will likely hold “several days of public hearings” in the summer, followed by publication of the hearing transcript, followed by an additional comment period.

For more information on DOL’s fiduciary definition project, or to provide input for a Council comment letter, contact Lynn Dudley, senior vice president, global retirement and compensation policy, or Jan Jacobson, senior counsel, retirement policy, at (202) 289-6700.

IRS Releases 2016 Indexed Amounts for HSAs, HDHPs

On May 4, the U.S. Treasury Department and Internal Revenue Service (IRS) released Revenue Procedure 2015-30, which lists the 2016 indexed amounts, adjusted for inflation, for health savings accounts and high-deductible health plans (HDHPs). (In some cases, this resulted in no change from the prior year.) The following table lists the current 2015 amounts and the new 2016 amounts:

The Revenue Procedure is effective for calendar year 2016. For more information, contact Kathryn Wilber, senior counsel, health policy, at (202) 289-6700.

The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.

Notice: the information contained herein is general in nature. It is not, and should not be construed as, accounting, consulting, legal or tax advice or opinion provided by the American Benefits Council or any of its employees. As required by the IRS, we inform you that any information contained herein was not intended or written to be used or referred to, and cannot be used or referred to (i) for the purpose of avoiding penalties under the Internal Revenue Code, or (ii) in promoting, marketing or recommending to another party any transaction or matter addressed herein (and any attachment).