IRS Extends Deadlines for Plan/IRA Amendments to Reflect SECURE Act and Certain Other Changes

[34256]

August 17, 2022

TO: ICI Members
Pension Committee
Pension Operations Advisory Committee SUBJECTS: Pension RE: IRS Extends Deadlines for Plan/IRA Amendments to Reflect SECURE Act and Certain Other Changes

 

IRS Notice 2022-33[1] announces a much-needed extension of the deadlines for amending retirement plans and IRAs to reflect provisions of the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act),[2] section 104 of the Bipartisan American Miners Act of 2019 (Miners Act)[3] (lowering the age for in-service withdrawals from qualified pension plans and governmental 457(b) plans), and section 2203 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act)[4] (waiving the required minimum distribution (RMD) requirements for defined contribution plans and IRAs for 2020). The ICI requested an extension of the amendment deadlines for SECURE Act changes in numerous recent comment letters to the IRS.[5]

Prior to the extension, the amendment deadline for reflecting these changes for IRAs[6] and private-sector plans was generally December 31, 2022 (or, the last day of the first plan year beginning on or after January 1, 2022).[7] For governmental plans, the deadline was generally the last day of the first plan year beginning on or after January 1, 2024. Pursuant to Notice 2022-33, the extended amendment deadline for IRAs and non-governmental qualified retirement plans and section 403(b) plans (not maintained by a public school) is now December 31, 2025. For governmental plans (including 403(b) plans maintained by a public school), the extended deadline is generally 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 December 31, 2023.[8]

Notice 2022-33 specifies that for pre-approved plans, the extended plan amendment deadlines apply to both interim and discretionary amendments.

Notably, the extension does not apply with respect to other provisions of the CARES Act, such as section 2202, which permitted certain qualified individuals affected by the COVID-19 emergency to take penalty-free withdrawals from defined contribution plans and IRAs (up to $100,000), allowed plans to temporarily increase limits on plan loans for qualified individuals, and delayed the due date for certain plan loan repayments. The plan amendment deadline for those provisions remains unchanged (i.e., generally the end of 2022 for private-sector plans or 2024 for governmental plans).

 

 

 

Elena Barone Chism
Associate General Counsel - Retirement Policy

endnotes

[1] Notice 2022-33 is available here https://www.irs.gov/pub/irs-drop/n-22-33.pdf.

[2] For a summary of the SECURE Act of 2019, see ICI Memorandum No. 32118, dated December 20, 2019, available at https://www.ici.org/memo32118.

[3] See ICI Memorandum No. 32741, dated September 4, 2020, available at https://www.ici.org/memo32741.

[4] See ICI Memorandum No. 32556, dated June 26, 2020, available at https://www.ici.org/memo32556.

[5] See ICI Memorandum No. 34088, dated March 28, 2022, available at https://www.ici.org/memo34088; ICI Memorandum No. 34160, dated May 25, 2022, available at: https://www.ici.org/memo34160; ICI Memorandum No. 34174, dated June 3, 2022, available at https://www.ici.org/memo34174.

[6] IRAs are not required to be amended to reflect the CARES Act waiver of RMDs for 2020, pursuant to Notice 2020-51. See ICI Memorandum No. 32556, dated June 26, 2020, available at https://www.ici.org/memo32556.

[7] Amendments to individually designed plans generally do not need to be adopted until a change in the law is published on the IRS Required Amendments List, but for calendar year pre-approved plans—which includes most plans—amendments would have been needed by the end of 2022.

[8] Specifically for governmental 457(b) plans, the deadline to amend is the later of (i) 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 December 31, 2023, or (ii) if applicable, the first day of the first plan year beginning more than 180 days after the date of notification by the Secretary that the plan was administered in a manner that is inconsistent with the requirements of section 457(b) of the Internal Revenue Code.