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Section 436 Amendment Deadline Extended for Defined Benefit Plans

Notice 2012-70 extends the deadline for adopting a section 436 interim amendment to the last day of the 2013 plan year for most defined benefit plans. However, an individually designed defined benefit plan sponsor’s filing for a determination letter may accelerate this amendment deadline for the plan.

Extended deadline
A defined benefit plan sponsor may adopt a section 436 interim amendment by the latest of the:

  • last day of the first plan year beginning on or after January 1, 2013;
  • last day of the plan year for which IRC Section 436 is first effective for the plan; or
  • due date, including extensions, of the employer’s tax return for the tax year (determined by Rev. Proc. 2007-44, Section 5.06(2) for a tax-exempt employer) that contains the first day of the plan year for which IRC Section 436 is first effective for the plan.

Determination letter filing
In general, an individually designed defined benefit plan sponsor must incorporate a section 436 interim amendment in their restated plan if they file a determination letter application on or after February 1, 2013.

Section 436 amendment
Defined benefit plans must impose certain benefit restrictions if the plan is underfunded. An IRC Section 436 plan amendment that eliminates or reduces an IRC Section 411(d)(6) protected benefit does not cause the plan to fail to meet the anti-cutback requirements of IRC Section 411(d)(6) if:

  • the plan sponsor adopts a section 436 amendment by the deadline described in Notice 2012-70, and
  • the amendment eliminates or reduces protected benefits only to the extent necessary for the plan to meet the IRC Section 436 requirements.

Sample amendment
Individually designed and pre-approved single-employer defined benefit plan sponsors may adopt the sample amendment in Notice 2011-96.

Page Last Reviewed or Updated: 30-Sep-2013