Industry News

On November 3, 2020, the Groom Law Group released its publication, Recent Legislative and Regulatory Changes – Chart of Required and Optional Plan Amendments. In recent years, Congress enacted legislation affecting tax qualified plans, plan sponsors, participants and beneficiaries, including the: 1) Bipartisan Budget Act of 2018; 2) SECURE Act of 2019; and 3) Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. The Internal Revenue Service (IRS) has also issued regulations and other guidance related to the new laws as well as updated previous regulations.

In this publication, the Groom Law Group has provided a chart of the applicable changes for defined benefit (DB) and defined contribution (DC) plans, respectively. While many of the new rules are currently effective, various rules will need to be addressed with required and optional amendments for qualified plans. Specifically, the charts: 1) describe the key changes; 2) identify the source of the changes and IRS guidance to date; 3) note whether the change is required or optional; and 4) provide the general effective dates.

In most cases, the plan amendment deadline will not be until the 2022 plan year (or the 2024 plan year for governmental and certain collectively bargained plans), but any exceptions are also indicated. Importantly, Groom suggests that plan sponsors should await IRS guidance before amending for the SECURE and CARES Acts. However, terminating plans must be amended by the termination date.

The summary is available here.