The IRS has issued Announcement 2014-16 indicating that employers sponsoring preapproved defined contribution qualified retirement plans, such as 401(k) and profit sharing plans, will have until April 30, 2016 to restate their plans in their entirety.
The IRS was expected to begin providing approval letters to firms preparing proposed plan documents on or about March 31, 2014. Each employer seeking to rely on those preapproved documents will then have until April 30, 2016 to adopt a restated version of the employer’s plan integrating the specific provisions it elects to have included in the plan. The 2016 deadline marks the end of the current 6-year restatement cycle used by the IRS to make sure plan documents are regularly restated by plan sponsors to comply with changes in law. Preapproved plans have been reviewed by the IRS based on the 2010 Cumulative List of Changes containing updates in the law since the prior restatement period. The current changes will include updates required by the Pension Protection Act (PPA) and Heroes Earning Assistance and Relief Tax Act (HEART).
April 30, 2016 also marks the deadline for employers to submit requests for determination letter for the restated plans, if desired, to confirm that the restatement as drafted based on the options elect is in compliance with law.
© 2014 Parsonage Vandenack Williams LLC
For more information, contact us