Statutory Changes to PR Trusts, PR Retirement Plan Provisions and Estate Tax Matters

Junta de Supervisión Fiscal busca consultor de pensiones y retiro

On February 8, 2017, Governor Ricardo Roselló signed into law Act No. 9-2017 (the “Act 9”) which aims to protect, retain and attract professionals to Puerto Rico by providing more flexibility to retirement plans and ease their establishment, and to provide for better protection of trust assets. Act 9-2017 amends the Puerto Rico Internal Revenue Code of 2011, as amended (the “PR Code”), and the Trust Act, Act No. 219-2012 (the “Trust Act”). Below please find key amendments of Act 9: A. Amendments to the Trust Act 1. Establishes that trusts in PR now have full legal personality and provides for changes in trust termination rules. 2. Eliminates access by creditors to trust income in certain circumstances (excess of $36k/year, payments … [Read more...]

Q&A: Responsabilidad fiduciaria bajo la nueva regla del Departamento del Trabajo federal

Q&A: Responsabilidad fiduciaria bajo la nueva regla del Departamento del Trabajo federal

¿Qué hace la nueva regla del Departamento del Trabajo federal? La nueva regla fiduciaria reemplaza una regla vigente desde 1975 para determinar si alguien es un fiduciario bajo ERISA, la Ley de Seguridad del Ingreso de los Retirados de Empleo. La nueva regla amplía significativamente el universo de actividades que convertirían a alguien en fiduciario bajo ERISA tratando casi cualquier sugerencia sobre inversiones como asesoría fiduciaria. Algunas actividades comunes que tradicionalmente no se han considerado fiduciarias, que sí lo serían bajo la nueva regla, incluyen el recomendar o sugerir que un cliente transfiera ahorros de jubilación en un plan 401 (k) a ciertas cuentas IRA, o transfiera sus ahorros de ciertas cuentas IRA a otras. … [Read more...]

IRS Announces the 2017 Cost-of-Living Adjustments for Retirement Plans

La asignación de beneficios de planes de retiro y los casos de relaciones de familia

The Internal Revenue Service (“IRS”) recently announced retirement pension plans’ applicable cost-of-living adjustments affecting dollar limitations for the tax year 2017. Some of the key limits for the tax years 2017 and 2016 of importance to Puerto Rico tax qualified plans are as follows with changes underlined: 2016 2017 Annual Benefit Limitation for Defined Benefit Plans $210,000 $215,000 Annual Compensation Limit $265,000 $270,000 Annual Contribution Limitation for Defined Contribution Plans $53,000 $54,000 Highly Compensated Employee Threshold $120,000 $120,000 Elective Deferrals Limit – (Applicable in Puerto Rico to Dual Qualified Plans and Federal Government Thrift Savings … [Read more...]

Failure to provide time limit for filing action in notice of benefits denial held to render contractual limitation periods innaplicable by First Circuit

Failure to provide time limit for filing action in notice of benefits denial held to render contractual limitation periods innaplicable by First Circuit

Recently, the United States Court of Appeals for the First Circuit (the “Court of Appeals”) held in Santana-Díaz v. Metropolitan Life Insurance Company, that a plan administrator’s failure to include the time limit for filing a suit challenging its denial of a participant’s request for long term disability (“LTD”) benefits was a violation of the provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Therefore, instead of the term included in the LTD plan document, Puerto Rico’s limitation period for contractual disputes (15 years), applied to the claim. Background The plaintiff, Mr. Santana-Díaz (the “Plaintiff”), an employee of Shell Chemical Yabucoa, Inc. (“Shell”), participated in Shell’s employee … [Read more...]

René Avilés García

René Avilés García

Blog: Temas laborales René J. Avilés-García is a Capital Member and the Chair of Ferraiuoli LLC's Taxes & Employee Benefits Practice Group. René practices in two complimentary areas – employee benefits and trusts & estates. In his employee benefits practice, he focuses on complex pension plan design, operation and reorganization consultations (including mergers, spinoffs and transfers of assets between qualified retirement plans), as well as other deferred compensation arrangements. René also has substantial experience representing clients in: ERISA litigation pension plan administration and qualification with Puerto Rico tax authorities, and correction procedures with the U.S. Department of Labor On the trusts and estates … [Read more...]