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Ask the Experts October 8, 2024
What are the IRS Deadlines for 403(b) Plan Restatement and Amendment?
Experts from Groom Law Group and CAPTRUST answer questions concerning retirement plan administration and regulations.
Reported by PS
Q: I was a little confused by your recent Ask the Experts column which stated a restatement deadline of December 31, 2026, for 403(b) plans. I thought that plans were only required to be amended by that date, not restated. Am I simply incorrect?
Kimberly Boberg, Kelly Geloneck, Emily Gerard and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:
A: The Experts don’t believe that you are incorrect, but you may be confusing two separate deadlines related to 403(b) plan documents. The first deadline, referenced in our recent column, applies only to pre-approved plan documents. Generally, pre-approved plans are those produced by a service provider, financial institution or adviser and have already been approved by the IRS as to form. Plan sponsors with pre-approved plans are required to restate their entire plans onto that pre-approved plan document within a two-year period currently scheduled to open on January 1, 2025, and close on December 31, 2026.
This window does not apply to individually designed plans. Individually designed plans are generally prepared by an attorney to be used by one employer and are not pre-approved by the IRS. There is no restatement deadline for individually designed plan documents, but there is an amendment deadline.
The second deadline is an amendment deadline that applies to all 403(b) plan documents. That deadline requires plans to be amended (but not restated in their entirety) to comply with major legislation enacted in the last five years, including the Setting Every Community Up for Retirement Enhancement Act of 2019, the Coronavirus Aid, Relief, and Economic Security Act, the Taxpayer Certainty and Disaster Tax Relief Act of 2021 and the SECURE 2.0 Act of 2022. The current deadline for such 403(b) plan amendments to be executed is December 31, 2026 (December 31, 2028, for collectively bargained plans and December 31, 2029, for governmental plans). See See Notice 2024-2. As always, the IRS reserves the right to extend those deadlines.
NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.
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