In response to the continued administrative difficulties because of the COVID-19 pandemic, latest Inner Income Service (IRS) steering extends extra retirement plan deadlines for 2020.
In response to the executive difficulties confronted by plan directors because of the ongoing COVID-19 pandemic, the Inner Income Service (IRS) just lately issued Discover 2020-35, which extends extra retirement plan deadlines for 2020 not beforehand prolonged underneath IRS Discover 2020-23. The IRS additionally said that this reduction applies for functions of ERISA if the tax code deadline has a corresponding ERISA provision.
Adoption of Pre-Authorized Outlined Profit Plan
The April 30, 2020, deadline to undertake a pre-approved pension plan and submit a Kind 5307 willpower letter utility underneath the second six-year remedial modification cycle is prolonged to July 31, 2020.
Minimal Funding Waivers and Sure Funding Actions for Outlined Profit Plans
The Code permits outlined profit plan sponsors to acquire a waiver of minimal funding necessities within the occasion of non permanent substantial enterprise hardship, offered that the plan sponsor apply for the waiver by the 15th day of the third month after the top of the plan 12 months throughout which the waiver is sought. As well as, multiemployer-defined profit plans are required to have a plan actuary make sure certifications every year in regards to the plan’s funding by the 90th day of the plan 12 months. To the extent that these deadlines fall between March 30 and July 15, 2020, for a selected plan, that deadline has been prolonged to July 15. The IRS has equally prolonged numerous deadlines for sure multiemployer pension plan funding actions, reminiscent of establishing funding enchancment plans and offering sure participant notices.
Kind 5330 Submitting
The Kind 5330, used to report and pay sure excise taxes associated to worker profit plans, should be filed by numerous dates relying on the tax being paid. If the deadline for a selected Kind 5330 submitting falls between March 30 and July 15, 2020, it might now be filed by July 15, 2020.
403(b) Plan Remedial Modification Interval
403(b) plan sponsors might retroactively appropriate plan doc defects by amending the plan or adopting a pre-approved plan by the top of the remedial modification interval, which ought to have been March 31, 2020. This deadline has been prolonged to June 30, 2020.
As soon as authorized by the IRS, voluntary corrections made underneath the Voluntary Correction Program (VCP) part of the Worker Plans Compliance Decision System (EPCRS) should be made inside 150 days of the date of the written compliance assertion approving the proposed correction, together with adoption of plan amendments. To the extent that 150-day deadline falls between March 30, 2020, and July 15, 2020, for a selected correction, plan sponsors now have till July 15, 2020, to finish the correction.
These newly prolonged deadlines present retirement plan sponsors with elevated flexibility in plan administration within the midst of the COVID-19 pandemic. Plan sponsors ought to consider relevant extensions as they proceed to manage retirement advantages throughout 2020.