PLANADVISER - September/October 2022 - 7

the Taxpayer Certainty and Disaster
Tax Relief Act.
The new deadline for amending
qualified nongovernmental retirement
or 403(b) plans, including IRAs, for
CARES Act Section 2202 and for Tax
Relief Act Section 302 is December 31,
2025. These amendments allow qualified
individuals to receive favorable
tax treatment for having taken a coronavirus-related
distribution or a qualified
disaster distribution, respectively,
from an eligible retirement plan.
The plan amendment deadline for
CARES Act and Tax Relief Act provisions
for a qualified governmental plan is 90
days after the close of the third regular
session, counting from December 31,
2023, of the legislative body with the
authority to amend the plan.
In general, 403(b) plans maintained
by a public school follow this same
formula. For 403(b) plans not maintained
by a public school, the deadline
for amendment is December 31, 2025.
Governmental plans under Internal
Revenue Code Section 457(b) must
comply by the later of two dates: the
date arrived at by applying the same
formula as that for qualified 403(b)
plans or the first day of the first plan
year starting no more than 180 days
after the date the secretary of labor
notifies the plan that it was administered
in a way inconsistent with
Section 457(b).
The deadline to amend the trust
governing an IRA or the contract issued
by an insurance company with respect
to an individual retirement annuity is
December 31, 2025.
Maryland Opens a StateRun
Retirement Program
Maryland has officially opened its staterun
retirement program, to provide for
employees of small businesses without
an
employer-sponsored
retirement
plan or emergency savings program.
The state found that nearly
1 million employees work full-time
without access to either type of savings
program at their job. Under the new
Maryland law, established businesses
that use an automatic payroll system
must either offer a retirement plan or
enroll their employees in the MarylandSaves
program.
Businesses that sign up their workers
before December 1 will be exempted
from paying the state's $300 annual
report-filing fee for 2023, according to
a press release from MarylandSaves.
Employers will have no payment obligations
or federal reporting requirements;
additionally, the service will be
provided to the employer at no cost.
The program will handle most of
the administrative duties. Employers
must register their business, upload
payroll and employee information
into the system, and then keep staff
lists up to date and submit employees'
savings contributions.
The program is being administered
by a team of providers including
Vestwell and BNY Mellon, with investment
options managed by BlackRock,
Lincoln Financial Group, State Street
Global Advisors and T. Rowe Price, the
state announced.
Workers may start either a personal
WorkLife savings account or a Roth
individual retirement account funded
automatically from payroll deductions.
They may opt out at any time.
Judge Finds for Goldman
Sachs in ERISA Suit
A district court
Other updates
include a new
definition of
" office " for
the purpose
of determining
who is
a " member "
of a given
accounting firm ...
tained, the plan committee took
an unreasonable amount of time to
remove them from the lineup, doing
so only after increasing ERISA litigation
in the industry at large signaled
that the plan might be at risk. The
alleged conflict of interest and the
mismanagement,
Falberg
constituted
a
claimed,
were disloyal and imprudent, and
therefore
judge has ruled for
Goldman Sachs and its retirement
committee in a summary judgment,
which holds that they had not breached
their fiduciary duty under the Employee
Retirement Income Security Act to
employees invested in the firm's defined
contribution retirement plan.
Leonid Falberg, an employee of
Goldman Sachs from 1999 through
2008, filed a class action lawsuit in
October 2019 alleging that the firm had
breached its duties of prudence and
loyalty by maintaining five specific
proprietary mutual funds among the
choices on its retirement plan investment
menu. Falberg alleged that the
funds underperformed and charged
higher fees than reasonable alternatives
and that his employer had
continued to offer them anyway to
benefit itself.
Falberg further alleged a conflict
of interest. The funds had begun to
underperform in 2016, and, he mainfiduciary
breach
under ERISA.
In July 2020, District Judge Edgardo
Ramos of the U.S. District Court for
the Southern District of New York,
denied Goldman Sachs' motion to
dismiss. The firm subsequently moved
for summary judgment, this February.
Ramos approved this motion and ruled
in Goldman Sachs' favor, September 14.
According to the ruling, at a quarterly
retirement committee meeting
in September 2016, after the five challenged
funds had begun to underperform,
the committee asked its investment
adviser, Rocaton, to explore
alternatives. Goldman Sachs removed
four of the funds that December and
the last
in June 2017. Additionally,
two other proprietary funds, not challenged
by the suit, were removed.
The ruling notes that Goldman
Sachs, among plan investments, also
offered nonproprietary funds, which
underperformed its own. The ruling
further points out that a conflict of
interest is not a " per se breach, " and, as
there was no evidence that Goldman
planadviser.com September-October 2022 | 7
http://www.planadviser.com
PLANADVISER - September/October 2022

Table of Contents for the Digital Edition of PLANADVISER - September/October 2022
