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Good News for Safe Harbor Plan Sponsors: The IRS Will Allow Mid-Year Changes

February 9, 2016

Authors

Jennifer Stokes and Katharine Finley

Good News for Safe Harbor Plan Sponsors: The IRS Will Allow Mid-Year Changes

February 9, 2016

by: Jennifer Stokes and Katharine Finley

On January 29, 2016, the Internal Revenue Service issued guidance on mid-year changes to safe harbor plans under Internal Revenue Code Sections 401(k), and 401(m). Notice 2016-16 significantly expands the permissible mid-year changes available to sponsors of safe harbor plans under prior guidance.

The Notice provides guidance on mid-year changes to a safe harbor plan or to a plan’s safe harbor notice content that do not violate the safe harbor rules on account of being mid-year changes. For purposes of this Notice, a mid-year change is one that is either effective on a day other than the first of the plan year or one that is effective on the first of the plan year but adopted after that date.

This expansion, of course, comes with a few requirements. Simply put, Notice 2016-16 requires that any changes must meet applicable notice and election opportunities and

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Recent Guidance on Normal Retirement Age Regulations for Governmental Plans

May 8, 2012

Authors

benefitsbclp

Recent Guidance on Normal Retirement Age Regulations for Governmental Plans

May 8, 2012

by: benefitsbclp

The IRS and Treasury Department recently issued Notice 2012-29, which provides new guidance for the final “normal retirement age” regulations relating to governmental plans. The Notice provides that the IRS and the Treasury intend to further extend the effective date for governmental plans to comply with the final regulations to annuity starting dates that occur in plan years beginning on or after the later of:

  • January 1, 2015, or
  • the close of the first regular legislative session of the legislative body with the authority to amend the plan that begins on or after the date that is three months after the final regulations are published in the Federal Register.

The Notice also provides that the IRS and Treasury will make two important clarifications in the final regulations:

  • The final regulations will clarify that governmental plans that do not provide for in-service distributions before age 62
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