Compliance January 10, 2002

Senate Proposal Mandates Company Stock Warning

October 1, 2002 (PLANSPONSOR.com) - A Senate Democrat has introduced a bill that would add to ERISA a requirement that retirement plan administrators warn participants about the dangers of overweighting in company stock.
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According to a report from Washington legal publisher BNA, the proposal from Senator. Evan Bayh (D-Indiana.) requires the company stock warning on regular account statements for participants with more than 50% of their plan balance held in employer stock.

S3010 excludes plans not allowing participants to control their investments as well as ESOPs not tied to a 401(k) plan.

Bayh’s bill also requires that a tax deduction for qualified retirement planning services received as a fringe benefit shouldn’t go above $1,500 annually and is not applicable to those with modified adjusted gross income higher than $100,000 annually.

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