IRS Provides Compliance Relief to Benefit Plan Sponsors
The IRS recently issued Notice 2022-33, extending the deadline for compliance with certain provisions of the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act), the Bipartisan American Miners Act of 2019 (Miners Act) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
Section 601 of the SECURE Act provides, in general, that benefit plan amendments must be adopted by the end of the 2022 plan year or a later date as prescribed by the Treasury Department. The new notice extends the amendment deadline as follows:
- For non-governmental qualified and 403(b) plans, the deadline is Dec. 31, 2025.
- For governmental qualified and 403(b) plans, the deadline is 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins after Dec. 31, 2023.
- For governmental 457(b) plans, the deadline is the later of 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins after Dec. 31, 2023, or the first day of the first plan year beginning more than 180 days after the date of notification by the IRS that the plan was administered inconsistent with section 457(b) of the Code, if applicable.
Additionally, the notice extends anti-cutback relief to amendments made before the new deadlines. A plan must be carried out as if the amendment applied as of its original effective date.
The extended deadlines also pertain to amendments to lower the in-service distribution age to 59 ½ in pension and governmental 457(b) plans under the Miners Act.
Under the CARES Act, the notice extends the deadline in regard to the 2020 waiver of required minimum distributions (RMDs). For non-governmental plans, the deadline to amend for this provision generally is Dec. 31, 2025. For governmental plans, the deadline is 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins after Dec. 31, 2023 (subject to the special rule for 457(b) plans).