It’s complicated, says a popular mantra– which certainly applies to the business world. Some companies manufacture shoes in Taiwan and sell them in the United States. Others collect data from satellites and organize it into meaningful reports.
PSI specializes in retirement plans.
Retirement planning is made more complicated by the fact that laws and regulations have sprung up organically over the course of decades. This means that they are not always streamlined, but more of a hodgepodge of sometimes overlapping and conflicting rules. There are myriad agencies overseeing the design and administration of retirement plans, with literally thousands of regulations– federal, state, and local– which may at times seem contradictory.
At PSI, we are proud of our expertise in navigating this thicket. We’ve built a solid track record based on the skills of our accountants, actuaries, administrators and attorneys (our ‘A’ team). So the client company can focus on making widgets, and leave the compliance testing to us.
For starters, we provide support and expertise to deal with Internal Revenue Service, Department of Labor, Pension Benefit Guaranty Corp. and Departamento Haciendo regulations, avoiding penalties and administrative hassle.
Here are just a few of the compliance tests that must be applied regularly:
- General test (Internal Revenue Code) for all retirement plans, to demonstrate actuarially that longterm benefits for top executives are not unfair
- Minimum distribution requirements (again, IRC) to ensure that participants are receiving appropriate annual distributions
- Maximum compensation rules to determine whether distributions exceed the legal limits
- • Average deferral percentages, to ensure that 401K salary deferral contributions made by highly compensated employees do not violate specific ratios.
The above are just a sampling of regulations which are stringent and often overlapping. It’s not uncommon for companies to ‘fall out’ of compliance– at a cost to corporation and participants– and for the plan to need ‘tweaking’ to reestablish its validity.
At PSI, our ‘A’ team is fully engaged with monitoring regulatory changes and adjusting the client’s procedures and protocols.
Such details as minimum distribution, average deferral percentage/average contribution percentage, maximum deferral limit, maximum profit-sharing contribution, minimum coverage, compensation testing, top-heavy minimums . . . are all in a day’s work for PSI.
And because many regulations affect taxable benefits and compensation, we constantly evaluate modifications in the IRS tax code, and revise or adjust plans accordingly. As specialists, understanding and applying the tax laws to our clients’ advantage is a cornerstone of our service.
At PSI, we don’t do criminal law or real estate; we don’t produce movies or widgets. We are retirement planning experts. The client has the benefit of a highly skilled division– an ‘A’ team at their service.