The AICPA Forensic and Valuation Services Executive Committee (FVSEC), on behalf of the AICPA, has submitted comments on the proposed DOL regulations to define ESOP appraisers as fiduciaries. The comments highlight their concerns with the proposed rule and discuss the potential effect of the proposed regulations:

The ESOP Association has submitted comments to the House Ways and Means Committee hearing on fundamental tax reform. The comments note suggest that the Committee should use the 1986 Tax Reform process as their model:

That's why fundamental demographic trends are so significant. The best estimates are that there are 78 million baby boomers in the U.S. (people born between 1946 and 1964)...These individuals, well along in life and career, have amassed over $13 trillion in assets — about 50 percent of the total held by all Americans. And a good portion of those assets takes the form of privately held businesses. According to the U.S. Census Bureau, there are approximately 6 million businesses with employees. More than half of these businesses are owned by boomers — who will want to unload those firms as they retire.

Part 3 - Building a System of Trust: Ten Hidden Secrets of Success in Employee-Owned Companies is now online. It shares three more hidden secrets and summarizes the importance of trust: "Simply put: without trust, the performance potential of an employee-owned company is severely diminished because the capacity to create competitive advantage through collaborative innovation is never realized."

The January 14, 2011 Employee Ownership Update is online and discusses the following:

The qualified charitable distribution provisions were renewed for 2010 and 2011, allowing individuals age 70½ or over to exclude from gross income up to $100,000 that is paid directly from their individual retirement accounts (excluding SEP or SIMPLE IRAs) to a qualified charity. The excluded amount can be used to satisfy any required minimum distributions that the individual must otherwise receive from their IRAs for 2010 and 2011. The deadline for making a 2010 QCD is January 31, 2011. The election to treat a January 2011 QCD as having been made in 2010 is made by including the QCD on the individual's 2010 income tax return.

5 Workplace Committees to Form and Their Business Benefits shares five employee committees to consider, including an ESOP education committee:

The court found, however, that so long as defendants used the June 30, 2008 valuation for the distribution because it reasonably appeared to maximize returns for Plan participants under then-prevailing circumstances, they were justified in doing so. The court also concluded that there "can be no question that reliance on the June 30, 2008 valuation seemed to best serve Participant interests." A new valuation was expected to cost at least $20,000 — practically a third of the plan sponsor's total value at the time. The court asserted that incurring over $20,000 in expenses for a new valuation, only a short time before the regularly scheduled valuation was set to take place, would run counter to defendants' statutory duty to defray administrative expenses. Accordingly, the court held that the plan sponsor acted in manner consistent with its fiduciary duty of loyalty by using the June 30, 2008 valuation as the basis for the distribution.

The January 3, 2011 Employee Ownership Update is online and discusses the following:

If you paid any benefit payments last year you will have to prepare and file some government forms. The General Instructions for Forms 1099, 1098, 5498, and W-2G provides guidance on how to prepare and file the forms: