The IRS has given pension plan sponsors what they've wanted for years: the green light to use a higher fixed rate when crediting interest to their employees' cash-balance accounts.
The agency also delivered good news to 401(k) account holders that after-tax money in their accounts can be rolled into a Roth IRA tax-free.
Sponsors of cash-balance, which offer features of both defined benefit and defined contribution plans, have been in limbo on the interest rate question since 2010.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
