(b)lines Ask the Experts – The Effect of Lacking Guidance About Fee Disclosure
Michael A. Webb, Vice President, Retirement Practice, Cammack LaRhette Consulting, answers:
Yes, it is correct that that the Department of Labor has yet to publish its final rule regarding vendor fee disclosure under Section 408(b)(2) of ERISA (it is expected by the end of January). However, the tight timeframe between the release of the final rule and the document deadline (April 1 is less than three months away), has caused some practitioners to question whether the deadline will be extended. Though the DoL has not formerly commented on the matter, such an extension would not be unprecedented.
Nevertheless, until an extension is issued, plan sponsors should assume that the deadline is indeed April 1, and impress upon their vendors the importance of providing the relevant fee disclosure in advance of that deadline. Many vendors have already drafted fee disclosures that they intend to use with their plan sponsors.
Note that this issue is unrelated to the separate participant fee disclosure requirements under Section 404(a) of ERISA. There are separate deadlines for those disclosures (an initial disclosure deadline of May 31, 2012, for calendar year plans, for example), and it is not anticipated that the participant fee disclosure deadline will be extended.”
NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.
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