The Internal Revenue Service (IRS) recently released its’ Winter 2009 Employees Plans News edition on its’ Web site. The winter newsletter includes articles pertaining to 2010 rules and distribution regulations for Roth IRAs, notice requirements for pension plans that reduce benefit accruals as well as reminders for end-of-the-year deadlines. The IRS also offers a free newsletter called The Retirement News for Employers which has been created specifically for small business employers. The IRS encourages all small businesses to subscribe for their newsletter for tips, new features and regulation updates pertaining to their sponsored retirement plan.

Investment Advisor recently released an article regarding the reintroduction of the Automatic IRA Act of 2007, which is expected to be passed by Congress in 2010 requiring automatic IRA enrollment for all small businesses.

Last week, U.S. Senators Jeff Bingaman, D-Nm., Johnny Isakson, R-Ga., and Herb Kohl, D-Wis., introduced a bipartisan bill that would require employers who sponsor a 401(k) plan to inform their plan participants of the projected monthly income they could expect to live off of in their retirement years based on their current retirement account balance. 

Having addressed issues with the financial and banking industries over the last year, the federal government is planning to tackle the needs of small businesses during 2010. A recent article in the “New York Times” discusses how this proposed aid may be achieved by means such as tax breaks and more loans for small businesses.

Making pre-tax contributions to a salary deferral retirement plan has the advantage of participants paying lower taxes in the present. However, there’s another tax advantage that participants can make use of called Saver’s Credit. Also known as Retirement Savings Contribution Credit, it allows them to save even more for retirement.

The Department of Labor (DOL), particularly their Employee Benefits Security Administration (EBSA) division, has vowed to get tougher on enforcement when it comes to timely submission of employee contributions and the accuracy of information within Form 5500 paperwork. A recent article on Plansponsor.com stated these DOL/EBSA goals for 2010, as conveyed by Phyllis Borzi, the Assistant Secretary of Labor.

After two years of losses, more participants are beginning to see signs of recovery in their retirement accounts. According to an Associated Press article on MSNBC.com, the Vanguard Group, Inc reported that 60 percent of participants who continued to contribute and stayed invested have more money in their accounts than they had in September, 2007 – before the market decline. Even for those with lower balances, Vanguard says that most of them are less than 20 percent below their peak value.

A sign that the economy may be turning around is that many companies that had suspended their employer matching contributions have plans to restore them, in one form or another, during 2010. Hewitt Associates found that half of the companies they surveyed, including American Express and Motorola, stated their intention to do so.

An article released by the Associate Press this week unveiled a new index that measures how well 401(k) plans for thousands of companies are preparing their employees for retirement. Retirement-plan ratings firm, Fiduciary Benchmarks, released the Retirement Readiness Index, which measures the number of employers who sponsor retirement plans by industry. The index measures whether their plans are keeping pace or falling behind their peers and how their plan compares to other industries.