The Wyoming Retirement System had known of the benefits of adding a deemed IRA to its 457 Plan for several years, and formally discussed it as early as 2013. There are significant administrative complexities and potential cost in administering a deemed IRA, as listed below:
- Unregistered investment products — CITs and separate accounts – cannot be used in Deemed IRAs
- Custodian of Deemed IRA must either be a bank or have special IRS authorization
- not commonly available or understood
These have been barriers and although federal law was changed in 2002 to allow deemed IRAs, only a handful of deemed IRAs exist. WRS’ 457 Committee and staff met in January 2018 and made a commitment to bring the research and analysis for the initiative to culmination in 2018. The goal was to either put together compelling information to achieve WRS Board support for approving a Deemed IRA, or retire the project having determined the cost and complexity would outweigh the benefits.
At its meeting in November 2018, the WRS Board passed a motion approving the deemed IRA in concept, and requesting staff to develop a go to market plan for launch. This show of support by the WRS Board indicates it is feasible and beneficial to launch a Deemed IRA. It was a dramatic culmination of the intensive efforts of staff, trustees, consultants and service providers. The administrative ground work having been laid, a future opening of the Deemed IRA is planned for January 1, 2020.
- 0.00 KB File Size
- August 7, 2019 Create Date
- January 8, 2020 Last Updated