Our Employee Plans newsletter shares information about retirement plans for attorneys, accountants, actuaries, and other practitioners. It is permissible to reproduce our newsletter. We ask that you place a note stating that: It is a publication of the IRS Employee Plans, and The presence of IRS material does not constitute or imply the endorsement, recommendation, or favoring by the IRS of any opinions, products, or services offered by the sponsor of this webpage or document. On this Page Recent Developments Subscribe 2022 Newsletters 2021-2015 Newsletters Recent Developments Changes to guidance, law and procedures that affect Employee Plans. Form 5300 Electronic Submission The IRS revised Form 5300, Application for Determination for Employee Benefit Plan, and its instructions, to submit the form electronically. For more information see the July 14, 2022 newsletter. Subscribe Get email updates on the latest developments for Federal, State and Local Governments: Tax law changes Events calendar Compensation and fringe benefit issues Information return reporting Social Security Administration news and events Subscribe to email updates 2022 Expand/Collapse All December 8 Status of Proposed Regulations to Update Mortality Tables; Scope of Notice 2022-22 On April 27, 2022, the Internal Revenue Service and the Department of the Treasury released proposed regulations to update the mortality tables that are used under Internal Revenue Code Section 430(h) to calculate minimum required contributions for single-employer defined benefit pension plans. The regulations are proposed to be first effective for plan years beginning in 2023. The IRS also released Notice 2022-22PDF on April 27, 2022. Notice 2022-22 provides mortality tables that apply for valuation dates occurring during 2023 pursuant to the existing regulations under Section 430(h) and specifies a mortality improvement scale that applies under those regulations. An April 28, 2022, Employee Plans Newsletter, explained that if the proposed regulations are finalized effective for plan years beginning on or after January 1, 2023, then the mortality tables provided in Notice 2022-22 will apply for purposes of calculating minimum required contributions only for a plan with a plan year that begins in 2022 and that has a valuation date in 2023. The IRS and the Department of the Treasury are no longer planning to finalize those proposed regulations with an effective date during 2023. Therefore, pursuant to existing regulations, the mortality tables provided in Notice 2022-22 will apply for purposes of calculating minimum required contributions for a valuation date in 2023 for all plans. Notice 2022-22 also provides a modified version of the mortality tables used under Section 430(h) to determine the minimum amount of a lump-sum distribution from a defined benefit pension plan for stability periods beginning during 2023. The applicability of this mortality table for 2023 is not affected by the delay in the finalization of the proposed regulations. September 29 The IRS Nationwide Tax Forum wrapped up in August with more than 10,000 tax professionals attending the virtual sessions. IRS Employee Plans presented the seminar, Retirement Plans: Avoid These Pitfalls When Managing Your Small Employer Plan. Checklists: Part of our presentation focused on a series of plan checklists that may help small business owners keep their plans in compliance. 401(k) Plan ChecklistPDF SEP Plan ChecklistPDF SIMPLE IRA Plan ChecklistPDF SARSEP IRA Plan ChecklistPDF Chat Questions: We received several questions in the chat feature in the booth and during the presentation. Following are answers to some of the most common questions. The plan sponsor is responsible for all things having to do with the plan, from determining when employees enter the plan, to distributions, to filing the Form 5500 series returns. If you purchase or set up a plan with a financial institution or hire an advisor to help with your plan, make sure you understand exactly what they’re going to do for you. In the end, the plan sponsor is responsible for administering the plan. SEP, SIMPLE, and SARSEP IRA-based plans do not file a Form 5500 series return. A one-participant 401(k) plan can allow for both pre-tax salary deferrals and after-tax Roth salary deferrals, but the plan document must include language for both. Contributions made to a Roth IRA are not affected by amounts contributed to a Roth 401(k) plan. Contributions you make to a Roth IRA are limited based on your filing status and income. Roth 401(k) deferrals do not affect amounts you can contribute to a Roth IRA. Limits for 2022: $6,000 Plus $1,000 age 50 catch-up Amounts an individual contributes in a Roth 401(k) plan are limited by IRC 402(g). Roth IRA contributions do not affect amounts you can defer in a Roth 401(k) plan. Limits for 2022: $20,500 Plus $6,500 age 50 catch-up In a SEP IRA plan, all eligible employees (including the owner) must receive the same percentage of any contribution made to the SEP. Deductions for contributions to your traditional IRA may be limited if you or your spouse is covered by a workplace retirement plan. Contributions to your IRA don’t affect (and are not affected by) contributions in a workplace retirement plan. Contributions to your IRA don’t affect (and are not affected by) contributions in a workplace retirement plan. Retirement Plans Video Series: These short videos provide an overview of the key features of many types of plans adopted by small employers. What you Should Know About Retirement Plans: Profit-Sharing Plans 401(k) Plans Defined Benefit Plans What you Should Know About IRA-Based Plans: SEP IRA Plans SIMPLE IRA Plans SARSEP IRA Plans Payroll Deduction IRAs Choosing a Retirement Plan: Retirement Plans for Small Employers and Self-Employed Retirement Plans for Small Employers and Self-Employed (SP) July 14 Pre-approved Plan Deadline – July 31, 2022 If you have a pre-approved profit-sharing, 401(k) or other defined contribution plan, your two-year window to adopt a newly updated pre-approved plan ends on July 31, 2022. File 2021 Form 5500-EZ Electronically Using EFAST2 Plan sponsors must file their Form 5500 series returns by July 31, 2022, for 2021 calendar year plans. File a Form 5558 if you need more time to file your Form 5500 series return, Form 8955-SSA, or Form 5330. A one-participant plan or a foreign plan required to file an annual return must file Form 5500-EZ: Electronically using the Department of Labor’s EFAST2 filing system, or On paper with the IRS. Plan sponsors are encouraged to file their 2021 Form 5500-EZ electronically. It’s safe, easy to complete and you have an immediate record that the return was filed. If you’re required to file at least 250 returns of any type with the IRS, you must file Form 5500-EZ electronically using EFAST2. See the Form 5500 Corner for more filing information. Plans Retroactively Adopted After the End of the Plan Year If an employer adopts a plan during the employer’s 2022 taxable year (but not later than the due date, including extensions, for filing the employer’s 2021 tax return) and elects to treat the plan as having been adopted as of the last day of the employer’s 2021 taxable year, then the plan sponsor will not be required to file a Form 5500 series return for the plan year that begins during the employer’s 2021 taxable year. Instead, the first Form 5500 series return required to be filed with respect to the plan will be the 2022 return. The plan sponsor must check Box E in Part I on the 2022 Form 5500 series return indicating that the employer elects to treat the plan as retroactively adopted as of the last day of the employer’s 2021 taxable year. For a defined benefit plan, attach a 2021 Schedule SB to the 2022 Form 5500 series return, in addition to a 2022 Schedule SB. See the instructions for a more complete explanation. Form 5300 Electronic Submission The IRS revised Form 5300, Application for Determination for Employee Benefit Plan, and its instructions, to submit the form electronically. All Form 5300 determination applications must be submitted electronically at www.Pay.gov. Do a search on Pay.gov for 5300 to find the form and follow the directions on that webpage. See Apply for a Determination Letter for more information. TE/GE Actuary Job Openings The IRS Tax Exempt and Government Entities Division currently has eight openings for Actuary GS 14 positions across the country. The application deadline is July 22, 2022. Actuaries in TE/GE are responsible for private letter ruling requests, assisting with guidance projects, and working closely with revenue agents on pension plan examinations to provide technical expertise and assistance. The basic educational requirements include a bachelor’s degree with courses in actuarial science, mathematics, relevant statistics, business, finance, economics, insurance, or computer science totaling at least 24 semester hours. You must have at least 12 semester hours of mathematics that include differential and integral calculus, and one or more mathematic courses for which these calculus courses were prerequisites. You must include a college transcript with your application for it to be considered. For more information about available actuarial positions at the IRS, do a keyword search for ‘1510’ on USAjobs.gov. June 3 New 90-day Pre-Examination Compliance Pilot The IRS Employee Plans function is piloting a pre-examination retirement plan compliance program beginning in June 2022. This program will notify a plan sponsor by letter that their retirement plan was selected for an upcoming examination. The letter gives a plan sponsor a 90-day window to review their plan’s document and operations to determine if they meet current tax law requirements. If you don’t respond within 90 days, we’ll contact you to schedule an exam. If your review reveals mistakes in the plan’s documents or operations, you may be able to self-correct these mistakes using the correction principles in our voluntary compliance program (EPCRS), described in Revenue Procedure 2021-30PDF. If you find mistakes during your review that aren’t eligible to be self-corrected, you can request a closing agreement. We’ll use the Voluntary Correction Program fee structure to determine the sanction amount you pay under a closing agreement. The IRS will review your documentation and determine if we agree with your conclusions and that you appropriately self-corrected any mistakes. We’ll then issue a closing letter or conduct either a limited or full scope examination. Our goal with this program is to reduce taxpayer burden and reduce the amount of time spent on retirement plan examinations. At the end of this pilot, we’ll evaluate its effectiveness and determine if it should continue to be part of our overall compliance strategy. May 25 Form 5300 Electronic Submission The IRS is revising Form 5300, Application for Determination for Employee Benefit Plan, and its instructions, to be submitted electronically. Beginning June 1, 2022, you’ll be able to submit a Form 5300 determination application electronically at www.Pay.gov. Do a search on Pay.gov for 5300 to find the form and follow the directions on that webpage. The IRS will continue to accept paper versions of Form 5300 through June 30, 2022. You'll receive a confirmation e-mail after you submit your Form 5300 application through Pay.gov that is your acknowledgement notice. The IRS does not mail a separate acknowledgement letter for Pay.gov submissions. Pay.gov will accept one additional PDF document (less than 15MB) as part of your submission. Remove any items over the 15MB limit before you submit. Fax any remaining documents to 844-255-4818. To have the information associated with your application, include a fax coversheet that contains the Pay.gov Tracking ID, employer name, EIN, and the plan name listed on the submitted Form 5300. Contact IRS Customer Accounts Services at 877-829-5500 for additional help. The user fee for a Form 5300 submitted on or after January 3, 2022, is $2,700 (or $4,000 for multiple employer plans) if the plan does not qualify for the zero-dollar user fee in Notice 2017-1. Applicants must pay the user fee through Pay.gov for an electronic submission using a bank account, credit card, or debit card. See Revenue Procedure 2022-4 for the latest procedures and user fees for determination letter requests. Issue Snapshots Issue Snapshots are technical discussions of retirement plan issues and include technical resources along with audit tips and issue indicators. The most recent Issue Snapshots from Employee Plans are: Calculation of Plan Compensation for Partnerships Calculation of Plan Compensation for Sole Proprietorships Deemed Distributions – Participant Loans Combined Limits under IRC Section 404(a)(7) Extension of Relief from Physical Presence Requirement The IRS released Notice 2022-27PDF which provides a 6-month extension of the relief provided in Notice 2021-40. This notice provides temporary relief of the physical presence requirement, through December 31, 2022, for participant elections that are required to be witnessed by a plan representative or notary republic. May 23 Impact of Missed Deadline for Restatement of Pre-approved Plans The IRS reviews pre-approved plan submissions and issues opinion letters (and advisory letters for previous cycles) for each recurring plan amendment cycle. Each cycle provides a window for affected employers to adopt the restated plan. To maintain a plan's status as a pre-approved plan and retain uninterrupted reliance on its opinion letter, an employer must adopt each applicable cycle's restatement by the due date for that cycle. Missed Deadline for 401(a) Defined Benefit Plans The IRS announces the time period when employers must adopt plan restatements for 401(a) plans for each plan cycle. In Announcement 2018-05, the IRS opened the 2-year restatement window for defined benefit plans approved for Cycle 2, ending on April 30, 2020, that was subsequently extended to July 31, 2020, by Notice 2020-35. If a restatement is not adopted by the Cycle 2 deadline, an employer's retirement plan is no longer a pre-approved plan. The employer is no longer considered a prior adopter because the employer hasn't timely adopted a pre-approved plan for the cycle immediately preceding the opening of the current cycle. The plan therefore is an individually designed plan, and as a result, the plan must be reviewed to determine if there are form defects in the following areas: Any prior interim and discretionary amendments made while the plan was a pre-approved plan will need to be reviewed and corrected if they do not meet the requirements of IRC 401(a). The rules for individually designed plans (Rev. Proc. 2016-37, section 5PDF) would govern the remedial amendment period applicable for those, and all other required changes, to determine how far back the form error occurred if one exists. If after reviewing the plan and any interim or discretionary amendments, you determine that one or more provisions did not meet the requirements of IRC 401(a), the qualified status can be corrected. As an individually designed plan, your plan would meet the Self Correction Program (SCP) requirement of a prior letter (Rev Proc 2021-30 section 5.01(4)PDF). Reliance on the opinion or advisory letter from when the employer first adopted a pre-approved plan is equivalent to a determination letter (Rev Proc 2015-36, section 19.04). If you find a defect that has existed for less than the past 3 years, you can correct it under SCP. For older form defects, you would have to file a Voluntary Correction Program (VCP) application to correct the failure. Missed Deadline for 403(b) Pre-approved Plans Revenue Procedure 2017-18 provided a 3-year window for an employer to restate their plan if they intended to become an IRC 403(b) pre-approved plan for Cycle 1. That window ended on March 31, 2020, and was subsequently extended to June 30, 2020, by Notice 2020-35. A 403(b) plan had no pre-approved program prior to Cycle 1. A 403(b) plan that intended to be a pre-approved plan for Cycle 1, but failed to adopt a restatement by June 30, 2020, never became a pre-approved plan. It would be reviewed as an individually designed plan, based on the requirements of Rev. Proc. 2019-39, sections 6-9PDF. Since a 403(b) plan could not apply for a determination letter, the prior letter requirement has a more lenient condition to meet. A 403(b) plan meets the favorable letter condition in Rev Proc 2021-30 section 4.03(1), if the employer had a written plan document in place in 2009, or if later, in the year the plan was first adopted. If you find a defect that has existed for less than the past 3 years, you can correct it under SCP. For older form defects, you would have to file a Voluntary Correction Program (VCP) application to correct the failure. Conclusion The failure to qualify as a pre-approved plan is not a qualification issue. Being a pre-approved plan is one method of meeting the requirement to have an updated written plan document. If the employer who sponsors a plan does not timely adopt a current pre-approved plan, it can still meet the written document requirements as an individually designed plan. Individually designed plans that don't meet those requirements can be self-corrected under the circumstances detailed in Rev. Proc. 2021-30, Part IV. April 29 Help Improve IRS.gov – Participate in a study We want to make it easier for you to use our website by improving how it’s organized. Sign up to participate in our study and tell us how you want to find the information on IRS.gov that you need. After you schedule your study session, you’ll receive an email from our research team with meeting details. Who can participate in the study You must be at least 18 years of age. You must be an employer, small business owner or retirement plan administrator, or work for a charity or other tax-exempt organization. You MAY NOT be a current or past employee of the IRS or U.S. Department of the Treasury. If you’re unable to participate in this study, there will be future opportunities to help us improve the website. If you have questions about this study, please contact us at irsgovtesting@irs.gov. 2023 Internal Revenue Service Advisory Council The IRS is accepting applications for the Internal Revenue Service Advisory Council for 2023 through June 3, 2022. Members are appointed to three-year terms beginning in January 2023. IRSAC is the advisory body to the IRS Commissioner and provides an organized public forum for discussion of relevant tax administration issues between IRS officials and representatives of the public. IRSAC members are drawn from substantially diverse backgrounds representing a cross-section of the taxpaying public. Nominations of qualified individuals may come from individuals or organizations. The IRS is seeking applications from a variety of tax specialties, including individuals with substantial experience in retirement plans, charities and tax-exempt organizations. The advisory council Proposes enhancements to IRS operations Makes recommendations to improve taxpayer service, compliance and tax administration Discusses relevant information reporting issues Addresses matters concerning tax-exempt and government entities, including retirement plans Conveys the public’s perception of professional standards and best practices for tax professionals For more information on IRSAC and how to apply, go to the IRSAC’s webpage. If you have questions about the application process, please email us at mailto: publicliaison@irs.gov. April 28 Proposed Regulations to Update Mortality Tables The Internal Revenue Service and the Department of the Treasury released proposed regulations to update the mortality tables that are used under Internal Revenue Code Section 430(h) to calculate minimum required contributions for single-employer defined benefit pension plans. The regulations are proposed to be first effective for plan years beginning in 2023. The IRS also released Notice 2022-22PDF to provide mortality tables that apply pursuant to the existing regulations under Section 430(h). Assuming the new proposed regulations are finalized effective for plan years beginning on or after January 1, 2023, the mortality tables provided in Notice 2022-22 will apply for purposes of calculating minimum required contributions only for a plan with a plan year that begins in 2022 and that has a valuation date in 2023. Notice 2022-22 also sets forth a modified version of the mortality tables used under Section 430(h) that is used to determine the minimum amount of a lump-sum distribution from a defined benefit pension plan. This table will apply for 2023 even if the new regulations are finalized with a 2023 effective date. The mortality tables in the proposed regulations are derived from the tables set forth in the Pri-2012 Private Retirement Plans Mortality Tables Report issued by the Retirement Plans Experience Committee (RPEC) of the Society of Actuaries. That report is based on the most recent large-scale study of the mortality experience of pension plan participants, which used data from calendar years 2010 through 2014. The mortality rates in the proposed regulations are developed by adjusting the mortality experience from that study for improvements in mortality experience since 2012, and expected improvements into the future. For 2023, the mortality improvement rates are from the Mortality Improvement Scale MP-2021 Report, the latest update to RPEC's annual study of mortality improvement. This report, issued in 2021, was prepared based on actual mortality experience from 2013 through 2019 (the most recent year for which the data was available) and assumptions for later improvements in mortality. The MP-2021 mortality improvement rates don't take into account actual mortality experience in 2020 and 2021, the first years affected by the COVID-19 pandemic. The long-term mortality improvement rates also don't reflect any adjustment for the effect of COVID-19 on expected mortality rates in the long term. To the extent there is a long-term impact on mortality rates from COVID-19, the IRS and the Treasury Department expect that RPEC will reflect that impact in future mortality improvement scales, which the IRS and Treasury Department could then specify for use under Section 430(h) in future guidance. March 25 IRS SUSPENDS MAILING The IRS is suspending the issuance of several notices generally mailed to tax-exempt or governmental entities in case of a delinquent return. Due to the historic pandemic, the IRS hasn’t yet processed several million returns filed by individuals and entities. The suspension of the notices will help avoid confusion when a filing is still in process. The IRS will continue to assess the inventory of pending returns to determine the appropriate time to resume mailing these notices. Some taxpayers and tax professionals may still receive the notices during the next few weeks. Generally, there is no need to call or respond to the notices as long as the return was filed timely. The suspended notices are: Number Name CP214 Reminder Notice About Your Form 5500-EZ or 5500-SF Filing Requirement CP217 Form 940 Not Required – Federal, State, and Local Government Agencies CP259A First Taxpayer Delinquency Investigation Notice – Form 990/990EZ/990N CP259B First Taxpayer Delinquency Investigation Notice – Form 990PF CP259D First Taxpayer Delinquency Investigation Notice – Form 990T CP259F First Taxpayer Delinquency Investigation Notice – Form 5227 CP259G First Taxpayer Delinquency Investigation Notice – Form 1120-POL CP259H First Taxpayer Delinquency Investigation Notice – Form 990/990EZ CP403 First Delinquency Notice – Form 5500 or 5500-SF CP406 Second Delinquency Notice – Form 5500 March 18 IRS Meeting for Pre-approved Plan Providers and Mass Submitters: Discussion of Cycle 2 403(b) Pre-Approved Plan Submissions The IRS will host a virtual meeting with pre-approved plan providers and mass submitters to discuss technical and procedural requirements for the upcoming Cycle 2 403(b) pre-approved plans submission period. When: Tuesday, April 26, 2022 12:00pm – 1:30pm Eastern Time Who should attend: This meeting is intended for providers and mass submitters who draft pre-approved plans and will apply for a Cycle 2 403(b) opinion letter under Revenue Procedure 2021-37. We anticipate this meeting will be mutually beneficial for the providers, mass submitters, and the IRS. Register: Please send an email to Cameron.R.Kalchert@irs.gov by April 8, 2022, if you’re interested in attending and we’ll provide you with instructions for joining the meeting. Publication 590-B The IRS updated Publication 590-B in February for use in preparing 2021 returns. Pub 590-B includes the updated life expectancy tables to use for all required minimum distributions due from your retirement plan or IRA on or after January 1, 2022. These new tables generally reflect longer life expectancies which should lead to lower required distribution amounts. RMD Deadline - April 1, 2022 Participants in retirement plans and IRA account holders who turned age 72 in 2021 (after June 30) must receive their first required minimum distribution (RMD) by April 1, 2022. If you’re still working for the business sponsoring the retirement plan, you can delay taking your first RMD from the plan until after you retire. This exception does not apply to 5% owners of the business, or to traditional, SEP and SIMPLE IRA accounts. Life expectancy tables were updated for 2022, so the table used to figure your 2022 RMD is different than the version to use for your 2021 RMD. The updated tables will generally lead to smaller required withdrawals for 2022 and future years. For a 2021 RMD (due April 1, 2022), use the life expectancy tables in Appendix B of the Pub. 590-BPDF used for preparing 2020 returns. For example, an unmarried person using Table III, the RMD for a person age 72 in 2021 will be based on a distribution period of 25.6 years. Divide the Dec. 31, 2020, balance by 25.6 to get the RMD for 2021. For a 2022 RMD (due Dec. 31, 2022), use the revised life expectancy tables in Appendix B of the Pub. 590-BPDF used for preparing 2021 returns. In our example of an unmarried person, now age 73, using the revised Table III, the RMD will be based on a distribution period of 26.5 years. Divide the Dec. 31, 2021, balance by 26.5 to get the RMD for 2022. February 28 Revised Form 5316 must be used by June 1, 2022 In December 2021, the IRS revised Form 5316, Application for Group or Pooled Trust Ruling. Using the current version of Form 5316 may prevent processing delays and avoid the return of your group or pooled trust application. Beginning June 1, 2022, you must use the Form 5316 with a revision date of December 2021, or your application will be returned. Find the version of any IRS form on the bottom right-hand corner of any page of the form. Current and prior versions of most IRS forms and publications can be found using a keyword search at IRS.gov/forms. You should always ensure you’re using the most recent version of any IRS form. Proposed Regulations: Required Minimum Distributions The IRS published proposed regulations on Internal Revenue Code Section 401(a)(9). These proposed regulations address required minimum distribution requirements for retirement plans and IRAs. We encourage you submit your comments electronically via the Federal eRulemaking Portal. Enter REG-105954-20 in the search box and follow the online instructions to submit your comment. You may submit comments on paper; however, due to limited personnel, comments submitted on paper will be considered to the extent possible. The comment period closes on May 25, 2022. 403(b) Pre-approved Plan Providers: Cycle 2 Submissions The IRS released Revenue Procedure 2021-37PDF, which provides procedures for issuing opinion letters for IRC 403(b) pre-approved plans for the second remedial amendment cycle (Cycle 2). It sets the submission period for providers and mass submitters to submit on-cycle applications for Cycle 2 opinion letters starting on May 2, 2022, and ending on May 1, 2023. It also sets the remedial amendment periods for IRC 403(b) pre-approved plans. 403(b) 2022 Cumulative List of Changes in 403(b) Pre-approved Plans In Notice 2022-8PDF, the IRS established the 2022 Cumulative List of Changes for pre-approved 403(b) plans. February 4 Remove Excess Salary Deferrals by April 15, 2022 The total of all salary deferrals a participant makes to various retirement plans – including 401(k), 403(b), SARSEP and SIMPLE IRA plans – is limited to $19,500 (plus an additional $6,500 if age 50 or over) for 2021. If you exceed this limit for 2021, you must take corrective action to withdraw the excess deferral amount, plus earnings, by April 15, 2022. If you withdraw the excess salary deferrals, plus earnings, by April 15: Excess deferrals are taxed in the calendar year deferred (2021) Earnings on the excess are taxed in the year withdrawn (2022) Excess is not subject to the 10% early distribution tax, 20% withholding, or spousal consent requirements If you don’t withdraw the excess salary deferrals, plus earnings, by April 15: Excess deferrals are taxed in the calendar year deferred (2021) and again in the year withdrawn Earnings on the excess are taxed in the year withdrawn Withdrawals may be subject to the 10% early distribution tax, 20% withholding, and spousal consent requirements Make correction to the affected plan using the Self-Correction or Voluntary Correction Programs Individuals who made salary deferral contributions to two or more retirement plans in 2021 may be most at risk for exceeding the deferral limit. The Interactive Tax Assistant can help you determine how to correct excess salary deferrals. Retirement Plans Video Series This IRS video series for small employers and self-employed individuals provides an overview of the key features of many different types of retirement plans. What you Should Know About Retirement Plans: This video series discusses the key features of the qualified retirement plans many small employers have adopted. Profit-Sharing Plans 401(k) Plans Defined Benefit Plans What you Should Know About IRA-Based Plans: This video series discusses the key features of the IRA-based plans adopted by many small employers. SEP IRA Plans SIMPLE IRA Plans SARSEP IRA Plans Payroll Deduction IRAs Retirement Plans for Small Employers and Self-Employed: This recorded webinar, in English and Spanish, helps you compare the types of retirement plans available for your business or organization. Retirement Plans for Small Employers and Self-Employed Retirement Plans for Small Employers and Self-Employed (SP) 2021 Expand/Collapse All December 21 Required Minimum Distributions: Age 72 (or 70 ½) Required Minimum Distributions (RMDs) are minimum amounts that you must withdraw from your IRA or retirement plan account each year after you reach age 72 (70 ½ if you reach 70 ½ before Jan. 1, 2020). In a workplace retirement plan, you can delay taking RMDs if you continue working and you’re not a 5% owner of the employer. IRS rules always require you to take RMDs from traditional IRAs, and SEP, SIMPLE, and SARSEP IRAs even if you continue working. The Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act), made several changes to RMDs in 2020 and 2021. 2020 RMD Waiver: Required minimum distributions (RMDs) were waived for 2020 for IRA and workplace retirement plan account holders, including individuals who: Reached age 70 ½ in 2019 and had their first and second RMDs due in 2020, or Had their first RMD due on April 1, 2021, for 2020. 2021 RMD: The waiver of RMDs as part of the CARES Act for 2020 was NOT extended to RMDs for 2021. IRA account holders and participants in retirement plans are subject to RMDs for 2021. If you reached age 70 ½ in 2019, your RMDs due in 2020 were waived. You have a 2021 RMD due by Dec. 31, 2021, based on your account balance on Dec. 31, 2020. If you reached age 72 in 2021, (and didn’t reach 70 ½ in 2019) your 2021 RMD is due by April 1, 2022, based on your account balance on Dec. 31, 2020. Your 2022 RMD is due by Dec. 31, 2022, based on your account balance on Dec. 31, 2021. If you’re still employed by the plan sponsor, and not more than a 5% owner, you can delay RMDs from that workplace retirement plan until you retire. RMDs are always required from traditional IRAs, SEP, SIMPLE and SARSEP IRA plans even if you’re still employed. If you left your job in 2021 and rolled over your workplace retirement plan account into your IRA, the RMD from your IRAs for 2021 won’t be affected by the rollover, but you may have an RMD due from the retirement plan. Amounts rolled over to your IRA from a workplace retirement plan in 2021 don’t affect your IRA RMD calculation since 2021 RMDs are based on your IRA account balances on Dec. 31, 2020. If you have a 2021 RMD due from your workplace retirement plan, it cannot be rolled over to your IRA. RMDs: IRA Beneficiaries Beneficiaries of IRA accounts must follow special distribution rules. The SECURE Act changed how and when beneficiaries must take distributions when the account holder dies after 2019. Under the CARES Act, beneficiaries do not have to take RMDs for or during 2020. For a 2019 death, life expectancy distributions, if applicable, would generally be required to start by the end of 2020. Since the CARES Act waived all 2020 RMDs, to use the life expectancy option, generally you must begin taking distributions by the end of 2021. If you don’t begin taking life expectancy distributions by the end of 2021, you’ll be required to take a complete distribution under the 5-year rule. For distributions based on the 5-year rule for deaths prior to 2020, you do not count 2020 as one of the 5 years. You would have until the end of the 6th year following the year of death for deaths in 2015 through 2019. For a 2020 death, life expectancy distributions, if applicable under the SECURE Act, would generally be required to start by the end of 2021. More information For more detailed information on RMDs, see: IRS.gov/rmd Publication 590-B, Distribution from Individual Retirement Arrangements (IRAs)PDF Publication 575, Pension and Annuity IncomePDF November 10 2022 Retirement Plan Limits The IRS released Notice 2021-61PDF to provide for cost-of-living adjustments to dollar limitations for retirement plan benefits and contributions. View IRS.gov/PlanCola for a chart of the plan limits for 2022 and prior years. FAQs: Rehires Following Bona Fide Retirement; In-Service Distributions With the COVID-19 pandemic and related issues causing labor shortages, many employers, including state and local government employers, are looking for ways to encourage retirees to return to the workforce and experienced employees to stay on the job. Some of these employers have asked how these efforts interact with Internal Revenue Code distribution rules that apply to their employer-sponsored pension plans. To address these issues, the IRS published two FAQs. FAQ #1 addresses an employer that, due to unforeseen hiring needs during the ongoing pandemic, rehires a retiree. Would the rehire cause the individual’s prior retirement to no longer be considered a “bona fide retirement” under the employer’s pension plan? This FAQ confirms that, in the absence of contrary plan terms, the rehiring would not cause the individual’s retirement to fail to be a bona fide retirement. The rehire would not jeopardize the plan’s tax-qualified status, and, if plan terms permit, distributions on account of the prior retirement could continue after the rehire. An employer should review the terms of the plan to see how they apply in the event of a rehire, including whether there is a need for plan amendments. FAQ #2 reminds employers that a qualified pension plan is permitted to provide for in-service pension distributions to individuals after they reach either age 59½ or the plan’s normal retirement age. Review the FAQs for more information on how employers can meet their employment objectives and still comply with the distribution and qualification rules that apply to their employer-sponsored pension plans. FY 2022 Program Letter The recently released Tax Exempt & Government Entities Program Letter lists our priorities for fiscal year 2022 and how they align with the IRS Strategic Goals. See Compliance Program and Priorities for information on current compliance strategies for retirement plans. September 24 Retirement Plan Video Series The IRS recently posted two new video series for small employers and self-employed individuals. Each short video provides an overview of the plan's key features. What you Should Know About Retirement Plans: This video series discusses the key features of the qualified retirement plans adopted by many small employers. Profit-Sharing Plans 401(k) Plans Defined Benefit Plans What you Should Know About IRA-Based Plans: This video series discusses the key features of the IRA-based plans adopted by many small employers. SEP IRA Plans SIMPLE IRA Plans SARSEP IRA Plans Payroll Deduction IRAs Recorded Webinars Our Retirement Plans for Small Employers and Self-Employed webinar is now available in both English and Spanish. These webinars help you compare retirement plans for your business or organization to help you choose the best plan. Retirement Plans for Small Employers and Self-Employed Planes de ahorros para la jubilación para los pequeños empleadores y personas que trabajan por cuenta propia (in Spanish) Esta presentación da un vistazo rápido a los tipos de planes de ahorros para la jubilación disponibles para los pequeños empleadores y las características clave, los pros y los contras de estos planes, y los requisitos de presentación, si los hay, para cada plan Drop-in Articles The IRS has a series of drop-in articles, in both English and Spanish, on the Outreach Connection webpage. You can use these articles in your newsletters or in other products and publication. Articles Choosing a retirement plan SARSEP-IRA Plans Choosing a SEP-IRA Plan Choosing a SIMPLE IRA Plan Choosing a 401(k) Plan Choosing a Defined Benefit Plan Profit-Sharing Plans for Small Employers Artículos Elección de un plan de jubilación (in Spanish) Planes IRA-SARSEP (in Spanish) Elección de un Plan IRA-SEP (in Spanish) Elección de un Plan IRA SIMPLE (in Spanish) Elección de un Plan 401(k) (in Spanish) Elección de un Plan de beneficios definidos (in Spanish) Planes de participación en las ganancias para pequeños empleadores (in Spanish) September 21 Retroactively Adopted Plans that Filed a Form 5558 Extension Section 201 of the SECURE Act provides that employers that adopt a retirement plan by the due date of their 2020 tax return, including extensions, may elect to treat that plan as being effective for the employer's 2020 tax year. In an Employee Plans News article published on August 6, 2021, the IRS clarified that plans retroactively adopted after the end of the plan year have no 2020 Form 5500 series return filing requirement. Plan sponsors that already submitted a Form 5558, Application for Extension of Time to File Certain Employee Plan Returns, for these retroactively adopted plans will not establish a 2020 Form 5500 filing requirement. Filing the Form 5558 does not result in an IRS delinquency notice if no 2020 Form 5500 was filed for the plan specified in the Form 5558. Delinquency notices are based on when the Form 5500 series return is filed, not the filing of the Form 5558. See the Form 5500 Corner for more information on filing your Form 5500 series returns. Form 2848 If you represent a taxpayer who needs to file a Form 5330, Return of Excise Taxes Related to Employee Benefit Plans, information on Completing Power of Attorney Form for Form 5330 will help you complete the form for the specific excise taxes involved. Issue Snapshots Issue Snapshots are technical discussions of retirement plan issues and include technical resources along with audit tips and issue indicators. The most recent Issue Snapshots from Employee Plans are: Calculation of Plan Compensation for Sole Proprietorships Terminations - Underfunded Single Employer Defined Benefit Plans Standard Terminations - Underfunded Single-Employer Defined Benefit Plans Preventing the Occurrence of a Nonallocation Year under Section 409(p) Expansion of Rollover Options Includes SIMPLE IRAs Church Plans, Automatic Contribution Arrangements and the Path Act 457(b) Plans Written Plan Requirements Catch-up Contributions Correction of Excess Deferrals 457(b) Plans of Tax-Exempt Entity - Tax Consequences of Noncompliance 403(b) Plans Catch-up Contributions Applying IRC 415(c) when aggregated with a 401(a) defined contribution plan The Universal Availability Requirement September 1 Updated IRC 403(b) Pre-Approved Program for Cycle 2 Revenue Procedure 2021-37PDF provides procedures for issuing opinion letters for IRC 403(b) pre-approved plans for the second remedial amendment cycle (Cycle 2). It sets the submission period for providers and mass submitters to submit on-cycle applications for Cycle 2 opinion letters starting on May 2, 2022, and ending on May 1, 2023. It also sets the remedial amendment periods for IRC 403(b) pre-approved plans. Many of the changes reflect improvements from the current IRC 401(a) pre-approved program as well as providing other new enhancements. Highlights of these changes include: Extends the deadline to adopt interim amendments for a change in IRC 403(b) requirements. Most 403(b) plans will have until the end of the second calendar year following the calendar year in which the change is effective. Provides a new Determination Letter program for amended pre-approved plans on Form 5307, similar to the current IRC 401(a) pre-approved program. Provides details on the system of remedial amendment periods that follows the initial remedial amendment period. Replaces prototype and volume submitter plans with a single opinion letter program. Provides that the IRS will issue a Cumulative List identifying the IRC 403(b) requirements that we will review for in plans submitted for each cycle. Employees of certain church-related organizations, described in IRC 414(e)(3)(B), are allowed to participate in a pre-approved retirement income account (RIA) plan for Cycle 2. Also, a Cycle 1 pre-approved RIA plan may be retroactively amended to July 1, 2020, to permit the participation of these same employees. An amendment to the Cycle 1 plan done in good faith does not affect an employer’s ability to continue to rely on the Cycle 1 opinion or advisory letter. However, there will be no reliance on the amendment itself. If you have any questions about Rev. Proc. 2021-37, contact Cameron Kalchert at mailto: Cameron.R.Kalchert@irs.gov or 513-975-6381. Changes to Interim Amendments Deadlines for IRC 401(a) Pre-approved Plans Revenue Procedure 2021-38PDF modifies the deadline for adopting interim amendments for IRC 401(a) pre-approved plans. For disqualifying provisions that are effective after December 31, 2020, interim amendments must be adopted by the end of the second calendar year following the calendar year in which the change in qualification requirements is effective with respect to the plan. For disqualifying provisions that were effective on or before December 31, 2020, an interim amendment continues to be timely if it’s adopted by the end of the remedial amendment period described in section 2.07 of Rev. Proc. 2016-37. This new deadline also applies to adopters of IRC 401(a) pre-approved plans that are maintained by more than one employer or by tax-exempt employers. The interim amendment deadline that applies to governmental employers is also modified. This change ensures that the deadline for amending IRC 401(a) pre-approved plans is consistent with the deadline for IRC 403(b) pre-approved plans outlined in Rev. Proc. 2021-37. If you have any questions about Rev. Proc. 2021-38, contact Cameron Kalchert at mailto: Cameron.R.Kalchert@irs.gov or 513-975-6381. August 6 Plans Retroactively Adopted After the End of the Plan Year Have No 2020 Form 5500 Filing Requirement Section 201 of the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) permits an employer to adopt a retirement plan after the close of the employer’s taxable year (by the due date, including extensions, for filing its tax return for the taxable year) and elect to treat the plan as having been adopted as of the last day of the taxable year. This provision applies to plans adopted for taxable years beginning after December 31, 2019. If an employer adopts a plan during the employer’s 2021 taxable year (but not later than the due date, including extensions, for filing the employer’s 2020 tax return) and elects to treat the plan as having been adopted as of the last day of the employer’s 2020 taxable year, then the plan sponsor will not be required to file a Form 5500 with respect to the plan for the plan year that begins during the employer’s 2020 taxable year (references to Form 5500 include the Form 5500-SF and Form 5500-EZ unless otherwise noted). Instead, the first Form 5500 required to be filed with respect to the plan will be the 2021 Form 5500. However, the plan sponsor will be required to check a box on the 2021 Form 5500 indicating that the employer elects to treat the plan as retroactively adopted as of the last day of the employer’s 2020 taxable year. Additionally, if the plan is a defined benefit plan, the employer will be required to attach a 2020 Schedule SB to the 2021 Form 5500 or Form 5500-SF, in addition to a 2021 Schedule SB. The instructions for the 2021 Form 5500 will further explain the filing requirements for plans adopted retroactively. We anticipate that similar rules will apply to the retroactive adoption of a plan pursuant to section 201 of the SECURE Act after an employer’s 2021 taxable year. Requesting Private Letter Ruling on Actuarial Issues The IRS identified some common errors that have been causing delays in processing requests for actuarial private letter rulings. The list of tips and common errors should help reduce processing delays and improve your experience with the actuarial private letter ruling process. Changes to IRS Correction Program for Retirement Plans The IRS released Revenue Procedure 2021-30 that made significant changes to the Employee Plans Compliance Resolution System, including: New correction options for overpayments from defined benefit plans may reduce the need to seek repayment from participants or beneficiaries who receive overpayments Correction period for correcting significant operational failures under Self Correction Program expanded from two to three years Effective January 1, 2022, the IRS will no longer accept anonymous submissions under the Voluntary Correction Program. Sponsors can request an anonymous pre-submission conference with the IRS beginning January 1, 2022 Sunset for safe harbor correction of Automatic Enrollment failures extended from December 31, 2020 to December 31, 2023 Limits on small overpayments and excess amounts that don’t require correction increased to $250 Issue Snapshots Issue Snapshots discuss retirement plan issues and include technical resources along with audit tips and issue indicators. The most recent Issue Snapshots from Employee Plans are: Fully Insured 412(e)(3) Plans Hardship Distributions from 401(k) Plans 457(b) Plans – Correction of Excess Deferrals 457(b) Plans of Tax-Exempt Entity - Tax Consequences of Noncompliance 457(b) Plans - Catch-Up Contributions July 22 Extension of Relief from Physical Presence Requirement The IRS released Notice 2021-40PDF which provides a 12-month extension -- through June 30, 2022 -- of the physical presence requirement for participant elections required to be witnessed by a plan representative or notary republic. File 2020 Form 5500-EZ Electronically Using EFAST2 Beginning January 1, 2021, a one-participant plan or a foreign plan required to file an annual return must file Form 5500-EZ: Electronically using the Department of Labor EFAST2 filing system, or On paper with the IRS A one-participant plan or a foreign plan can no longer file a Form 5500-SF in place of Form 5500-EZ. Plan sponsors are encouraged to file their 2020 Form 5500-EZ electronically. It’s safe, easy to complete, and you have an immediate record that the return was filed. A Form 5500-EZ filer that’s subject to IRS e-filing requirements (see Mandatory Electronic Filing), is required to file the Form 5500-EZ electronically using EFAST2. Visit the Form 5500 Corner for more information. Form 5310 Electronic Submission IRS Form 5310, Application for Determination for Terminating Plan, may be submitted electronically online at Pay.gov. After July 31, 2021, all Form 5310 applications must be submitted electronically. Paper submissions postmarked after July 31, 2021 will be returned to the applicant. The current user fee is $3,500 ($4,500 for multiple employer plans.) Some plans may qualify for the zero-dollar user fee. See Revenue Procedure 2021-4 for information on the latest procedures and user fees for determination letter requests. Drop-in Articles The IRS posted a series of drop-in articles, in both English and Spanish, on the IRS Outreach Connection webpage. These articles describe the types of plans that many small employers adopt to help their employees save for retirement. You can use these articles on your website, newsletter, or in other products and publications. Choosing a Retirement Plan If you’re a small employer or self-employed individual, starting a retirement plan can benefit you and your employees. Employer contributions are tax deductible A plan helps attract and retain employees. Small employers may receive a tax credit for new plans of up to $5,000/year for three years for the cost of setting up a new plan Low- to moderate-income employees may claim a Saver’s Credit of up to 50% for contributions made to IRAs and certain retirement plans These updated publications can help you find a retirement plan that’s the best fit for your business or organization. Publication 4118, Lots of BenefitsPDF Publication 3998, Choosing A Retirement Solution for Your Small BusinessPDF Publication 3998, Choosing A Retirement Solution for Your Small Business (in Spanish)PDF Publication 4222, 401(k) Plans for Small BusinessesPDF Publication 4333, SEP Retirement Plans for Small BusinessesPDF Publication 4334, SIMPLE IRA Plans for Small BusinessesPDF Publication 4587, Payroll Deduction IRAs for Small BusinessesPDF Publication 4806, Profit Sharing Plans for Small BusinessesPDF Publication 4484, Choose a Retirement Plan for Employees of Tax Exempt and Government EntitiesPDF Watch the webinar, Retirement Plans for Small Employers and Self-Employed, on the IRS Video portal. Multiemployer Plans Receiving PGBC Assistance Notice 2021-38PDF provides guidance under the American Rescue Plan Act of 2021 about the special assistance paid by the Pension Benefit Guaranty Corporation to eligible multiemployer defined benefit plans that are financially at risk. July 16 Updated IRS Correction Principles and Changes to VCP Outlined in EPCRS Revenue Procedure 2021-30 The IRS Employee Plans Compliance Resolution System (EPCRS) permits any plan sponsor of a retirement plan (including SEP and SIMPLE IRA plans) to correct plan failures. EPCRS offers three correction programs: Self-Correction Program (SCP) – Correct certain plan failures without contacting the IRS or paying a user fee Voluntary Correction Program (VCP) – Correct failures not eligible for SCP and to get the approval of the IRS that the failures were properly corrected. Audit CAP - Resolve failures discovered during an IRS audit that can’t be corrected using SCP. The IRS made significant changes and revisions to EPCRS in Revenue Procedure 2021-30 (PDF)PDF that may be beneficial to plan sponsors, participants, and the retirement plan community. Overpayments correction options: Expanded correction principles to allow plan sponsors to fix operational failures when plan participants or beneficiaries receive payments from defined benefit plans that exceed what is permitted by the terms of the plan, effective July 16, 2021. The new principles reduce the need to seek repayment from participants or beneficiaries who received overpayments, and in some cases, do not require the plan sponsor to reimburse the plan for overpayments to participants. Expansion of Self Correction for Significant Operational Failures: Extends the correction period of significant operational failures from two to three years, effective July 16, 2021. Expansion of Self Correction for Retroactive Plan Amendments: Makes it easier to use retroactive plan amendments to correct operational failures by removing the requirement that all participants in the plan benefit by the retroactive amendment, effective July 16, 2021. Anonymous VCP submissions: Effective January 1, 2022, Rev. Proc. 2021-30 eliminates anonymous submissions under VCP. Anonymous Pre-Submission Conferences: Effective January 1, 2022, the IRS will permit plan sponsors or their representatives to make an anonymous written request for a pre-submission conference to discuss a potential VCP submission at no cost to the plan sponsor. Following the pre-submission conference, if the plan sponsor submits a VCP request, it can no longer be anonymous. Extension of Automatic Enrollment Failures: Extends the sunset of the safe harbor correction method to correct missed elective deferrals for eligible employees subject to an automatic contribution feature in Section 401(k) or 403(b) plans. Increased Threshold for De Minimis Correction Amounts: Increase from $100 to $250 the threshold for certain de minimis amounts for which a Plan Sponsor is not required to implement correction. May 6 FAQs: Partial Terminations Under Section 209 of the Taxpayer Certainty and Disaster Tax Relief Act of 2020 (Relief Act) In response to Section 209 of the Relief Act, the IRS released five FAQs to help clarify how partial terminations are determined during any plan year which includes the period beginning on March 13, 2020, and ending on March 31, 2021. Compliance Programs and Priorities Tax Exempt and Government Entities issues a Program Letter at the beginning of each fiscal year that outlines the year's compliance programs. TE/GE updates Compliance Program and Priorities quarterly for the latest initiatives and the compliance approach used. Initiatives involve either an examination or a compliance or education contact about specific items on a filed return. Following are the compliance initiatives updated in 2021: Small exempt organizations that sponsor retirement plans One-participant 401(k) plans Worker classification Plan liabilities and unrelated business income Required minimum distributions in large defined benefit plans Earned income for self-employed plans Participant loans Overvalued assets Partial termination/partial vesting Operational Compliance List The IRS updated the Operational Compliance List for recent guidance and legislation. Plan sponsors can use this list to help identify changes that may affect their plan's compliance. TE/GE job announcements The IRS/Department of Treasury has positions available across the country. These announcements close soon, so apply today on USAJOBS.gov to become part of our team. Internal Revenue Agent (Employee Plans Agent) – Closes May 10, 2021 Internal Revenue Agent (Exempt Organizations Agent) – Closes May 10, 2021 IRS Pathways Recent Graduate Program (Staff Support Assistant) – Closes May 13, 2021 April 8 Tax Day Extension and IRA Contributions The IRS extended the 2020 federal income tax filing and payment deadline for all individuals to May 17, 2021. Individuals now have until May 17, 2021, to file their Form 1040 returns and make contributions to their IRAs for 2020. IRS Tax Relief for Winter Storm Victims Following disaster declarations issued by the Federal Emergency Management Agency, the IRS announced tax relief for victims of severe winter storms in Texas, Oklahoma and Louisiana. Affected individuals now have until June 15, 2021, to file their Form 1040 returns and make contributions to their IRAs for 2020. For more information on the extended due dates for various individual and business tax returns, including the beginning date of the disaster relief, see: Texas and Louisiana - Beginning date: February 11, 2021 Oklahoma - Beginning date: February 8. 2021 As part of this relief, Form 5500 series returns that were required to be filed on or after the winter storms beginning date are postponed through June 15, 2021. Remove Excess Salary Deferrals by April 15, 2021 The total of all salary deferrals a participant makes to various retirement plans – including 401(k), 403(b), SARSEP and SIMPLE IRA plans – is limited to $19,500 (plus an additional $6,500 if age 50 or over) for 2020. If an individual defers more than this limit for 2020, the excess deferral amount plus earnings must be distributed by April 15, 2021. Excess salary deferrals not withdrawn by April 15 are taxable in 2020 and again when withdrawn. The date to remove excess salary deferrals has not been extended. Individuals who made salary deferral contributions to two or more retirement plans in 2020 may be most at risk for exceeding the deferral limit. Use our Interactive Tax Assistant to help determine how to correct excess salary deferrals. File 2020 Form 5500-EZ Electronically Using EFAST2 Beginning January 1, 2021, a one-participant plan or a foreign plan required to file an annual return must file Form 5500-EZ: Electronically using the Department of Labor EFAST2 filing system, or On paper with the IRS. All plan sponsors are encouraged to file their 2020 Form 5500-EZ electronically. It's safe, easy to complete, and you have an immediate record that the return was filed. If a Form 5500-EZ filer is subject to IRS e-filing requirements (see Mandatory Electronic Filing), they're required to file the Form 5500-EZ electronically using EFAST2. If a filer fails to file Form 5500-EZ electronically when required to do so, they're deemed to have failed to file the return. Beginning January 1, 2021, a one-participant plan or a foreign plan can no longer file a Form 5500-SF in place of Form 5500-EZ. Information on the Form 5500-EZ filed using the EFAST2 filing system will not be available to the public on the DOL website. Form 5310 Electronic Submission The IRS is revising Form 5310, Application for Determination for Terminating Plan, and its instructions, to be submitted electronically. Beginning April 16, 2021, applications for terminating plans on Form 5310 may be submitted electronically online at www.Pay.gov. The IRS will continue to accept paper versions of Form 5310 through July 31, 2021. You'll receive a confirmation e-mail (acknowledgement) after you submit your Form 5310 application through Pay.gov. The IRS won't mail a separate acknowledgement letter for Pay.gov submissions. Pay.gov will accept one additional document file of up to 15MB. Remove any items over the 15MB limit before you submit. Contact IRS Customer Accounts Services at 877-829-5500 for help on how to submit the removed items. The user fee for Form 5310 submitted on or after January 4, 2021 is $3,500 (or $4,000 for multiple employer plans), if the plan does not qualify for the zero-dollar user fee in Notice 2017-1. Applicants must pay these user fees through Pay.gov using a bank account, credit or debit card. See Revenue Procedure 2021-4 for the latest procedures and user fees for determination letter requests. February 26 Choosing a Retirement Plan If you’re a small employer or self-employed, you may be busy trying to grow your business and haven’t thought about starting a retirement plan. Adopting a retirement plan benefits both the employer and employees. Employer contributions are tax deductible. Assets in a plan grow tax-deferred to retirement. A plan helps attract and retain employees. Small employers may receive a tax credit for new plans of up to $5,000/year for three years for the cost of setting up a new plan. A Saver’s Credit of up to 50% is available for contributions made by low- to moderate-income employees. Some plans may be a better fit than others, depending on many factors. For more information, check out the plan comparison chart in Choosing a Retirement Solution for Your Small BusinessPDF. New Webpages for Small Employer Retirement Plans Retirement Plans for Small Entities and Self-Employed has information for small employers and self-employed all in one place. You’ll find information on choosing a plan, maintaining a plan, filing requirements, how to find and fix errors, and a list of plan resources. Small Employer Retirement Plans During Economic Downturns includes information for employers that are maintaining a retirement plan during a tough economy. Webinar Posted: Retirement Plans for Small Employers and Self-Employed The IRS posted the recorded version of January’s webinar, Retirement Plans for Small Employers and Self-Employed. It provides an overview of the key features of retirement plans for small employers and self-employed. This recorded webinar and others are available on IRSvideos.gov. February 17 No Action Needed: Delayed Mailing of Notice CP 216F Plan sponsors do not need to take further action if they are currently receiving Notice CP 216F, Approval of Extension to file Form 5500 Series Return, for calendar year 2019 Forms 5500 series returns, after the final return for 2019 has been submitted. Processing of the Form 5500 extensions was delayed in 2020. This resulted in a delay in mailing Notice CP 216F. Typically, Notice CP 216F for calendar year 2019 Forms 5500 would have been mailed in the Summer/Fall 2020 before the final return was due. If you’re just receiving the Notice CP 216F, the request for the extension was timely received and the extension has been approved for filing the 2019 Form 5500. No further action is necessary. Follow Us on Social Media The IRS uses social media to share retirement plan information. This includes tax changes, scam alerts, initiatives, tax products and services, and more. IRS social media resources include: Twitter - specific topics: @IRSnews - tax announcements @IRSenEspanol - information in Spanish @IRStaxpros - for tax professionals @IRStaxsecurity - scam alerts @IRSsmallbiz - small businesses and self-employed @RecruitmentIRS - job opportunities. Instagram: Access “IRSNews” at https://www.instagram.com/irsnews or the Instagram app. YouTube: Video tips in English, Spanish and American Sign Language. Facebook: News and information for taxpayers and tax return preparers, also in Spanish. LinkedIn: IRS updates and job opportunities. Supplement your subscription to Employee Plans News by subscribing to the social media platform that best fits your needs. January 20 IRS Webinar: Retirement Plans for Small Employers and Self-Employed Watch this live IRS webinar designed to provide an overview of the key features of retirement plans for small employers and self-employed. An employer that adopts the right plan may keep it longer, make fewer mistakes and help their employees save for a more secure retirement. When: Thursday, January 21, 2021 1 p.m. Eastern Time Register: Select this link to register for this 30-minute event. Submit Questions: We invite you to submit questions you would like covered as part of this presentation. We won’t have a Q&A session at this webinar, but we may be able to incorporate your question into the presentation. Submit your questions to TEGE.Outreach@irs.gov. Please include Retirement Plans Webinar in the subject line. Continuing education (CE) credits will not be offered for this program. Pooled Employer Plan Amendments in Pre-Approved Plans The IRS issued opinion letters for third cycle pre-approved defined contribution (DC) plans on June 30, 2020. These opinion letters provided plan sponsors with reliance for the qualification changes in the 2017 Cumulative List. Plan providers have asked about amending their DC plans for Pooled Employer Plans (PEP), a new type of multiple employer plan provided by the SECURE Act. The IRS is creating language for plan providers to use to amend their current pre-approved plans to add a PEP feature. Providers may create their own PEP amendment, but they will not have reliance on those provisions. Please note that an amendment to add a PEP provision to a current pre-approved DC plan is not considered a modification for purposes of applying for a determination letter on a Form 5307, because it involves a law change after the 2017 CL. If you have any questions or concerns, please email Angelo Noe, angelo.c.noe@irs.gov or Milo Atlas, milo.s.atlas@irs.gov. January 11 IRS Webinar: Retirement Plans for Small Employers and Self-Employed Watch this live IRS webinar designed to provide an overview of the key features of retirement plans for small employers and self-employed. An employer that adopts the right plan may keep it longer, make fewer mistakes and help their employees save for a more secure retirement. When: Thursday, January 21, 2021 1 p.m. Eastern Time Register: Select this link to register for this 30-minute event. Submit Questions: We invite you to submit questions you would like covered as part of this presentation. We won’t have a Q&A session at this webinar, but we may be able to incorporate your question into the presentation. Submit your questions to TEGE.Outreach@IRS.gov. Please include Retirement Plan Webinar in the subject line. Continuing education (CE) credits will not be offered for this program. 2020 Expand/Collapse All December 23 RMDs Waived for 2020 The CARES Act waives required minimum distributions (RMDs) during 2020 for IRAs and defined contribution retirement plans. RMDs are also waived for beneficiaries with inherited IRAs and accounts inherited in a retirement plan. You’re not required to have been affected by the coronavirus to waive your RMD for 2020. Distributions of an amount that would have been an RMD in 2020 can generally be rolled over to another workplace retirement plan or IRA within 60 days of the distribution. RMDs rolled over by August 31, 2020, have special relief. RMD rolled over by August 31, 2020: Notice 2020-51PDF provides that if a distribution from an IRA of an amount that would have been an RMD in 2020 was made between January 1, 2020, and July 2, 2020, then the distribution can be rolled over by August 31, 2020. If a 2020 RMD was distributed after July 2, 2020, then the distribution must be rolled over within 60 days of the distribution. A 2020 RMD that’s part of a series of substantially equal periodic payments does not prevent it from being eligible for rollover. Additionally, if a 2020 RMD was distributed before August 31, 2020, but was repaid to the distributing IRA by August 31, 2020: The repayment is not subject to the one rollover per 12-month period limitation. An RMD from an inherited IRA can be repaid to the distributing IRA. Inherited IRAs: Distributions from inherited IRAs are not required in 2020. For deaths prior to 2020, beneficiaries are required to take distributions using the 5-year rule or yearly distributions over their life expectancy. The 5-year rule requires the inherited IRA to be distributed within 5 years following the year of the account holder’s death. 2020 does not count toward the 5 years. You would essentially have six years, instead of five, to distribute the inherited IRA if the account holder died before 2020. If you were taking distributions using the lifetime distribution option available for deaths prior to 2020, you’re not required to take a distribution in 2020. For an account holder who died in 2019, you would normally be required to begin taking distributions from the inherited IRA by the end of the following year, 2020, to take advantage of the lifetime distribution option. Since 2020 does not count, you have until the end of 2021 to begin taking distributions over your lifetime. Tax treatment of 2020 RMDs that are not rolled over: RMDs in 2020 that are not rolled over or repaid may be eligible to be treated as coronavirus-related distributions if you’re a qualified individual. A 2020 RMD that otherwise qualifies as a coronavirus-related distribution may be repaid over a 3-year period or have the taxes due on the distribution spread over three years. Special note for inherited IRAs: If a withdrawal from an inherited IRA qualifies as a coronavirus-related distribution, income from the withdrawal may be spread over three years for income inclusion. However, the withdrawal may not be repaid to the inherited IRA. Substantially equal periodic payments are not waived If you’re using substantially equal periodic payments to meet one of the exceptions to the 10% additional tax on distributions prior to age 59 ½, you’re still required to take your periodic payment in 2020. If you do not take your periodic payment in 2020, you lose the exception and those withdrawals taken in prior years will become subject to the 10% additional tax. Resources Coronavirus relief for retirement plans and IRAsCoronavirus-related Q&As for retirement plans and IRAsNotice 2020-50PDFNotice 2020-51PDF December 1 IRS Webinar: Retirement Plans for Small Employers and Self-Employed Watch this live IRS webinar designed to provide an overview of the key features of retirement plans for small employers and self-employed. An employer that adopts the right plan may keep it longer, make fewer mistakes and help their employees save for a more secure retirement. When: Thursday, January 21, 2021 1:00 PM Eastern Time Register: Select this link to register for this 30-minute event. Submit Questions: We invite you to submit questions you would like covered as part of this presentation. We won’t have a Q&A session at this webinar, but we’ll try to incorporate your question into presentation. Submit your questions to TEGE.Outreach@IRS.gov. Please include Retirement Plan Webinar in the subject line. Continuing education (CE) credits will not be offered for this program. IRS Meeting for Pre-approved Plan Providers: Discussion of Third Cycle Pre-Approved Defined Benefit Plan Submissions The IRS is planning a virtual meeting to discuss technical and procedural requirements for third cycle defined benefit pre-approved plans. This meeting is intended for those providers who draft pre-approved plans and will apply for a third cycle defined benefit opinion letter under Rev. Procs. 2017-41 and 2020-10. When: Thursday, January 21, 2021 12:00pm – 1:30pm Eastern Time Who should attend: Providers who are in the process of drafting plans should attend this virtual meeting and share their issues with the IRS prior to submitting plan documents for IRS review. We anticipate this meeting will be mutually beneficial for the providers and the IRS. Register: Please send an email to Cameron.R.Kalchert@irs.gov by January 6, 2021, if you’re interested in attending. Include your name and email address so we can provide you with instructions for joining the meeting. IRS Webinar: Uploading Forms 2848/8821 with Electronic Signatures Watch this live webinar discussing the new option for submitting third-party authorization forms and signatures electronically. Learn what electronic signatures are acceptable and how to authenticate a taxpayer’s identity when conducting remote transactions, plus live Q&A. When: Thursday, December 10, 2020 2:00 PM Eastern Time Register: Select this link to register for this 60-minute event. November 25 2021 Retirement Plan Limits The IRS released Notice 2020-79PDF to provide for cost-of-living adjustments to dollar limitations for retirement plan benefits and contributions. View the COLA webpage for a chart of the plan limits for 2021 and prior years. SECURE Act Guidance The IRS issued Notice 2020-68PDF to provide guidance on particular issues of the Setting Every Community Up for Retirement Enhancement Act of 2019 to assist in the implementation of these provisions. Some of the issues addressed by this guidance include: Small employer automatic enrollment credit Repeal of maximum age for traditional IRA contributions Long-term, part-time employees in 401(k) plans Qualified birth or adoption distributions Deadlines for plan amendments Withholding and Reporting Distributions to State Unclaimed Property Funds The IRS issued Revenue Ruling 2020-24PDF that discusses withholding and reporting with respect to payments from qualified plans to state unclaimed property funds. Distributions from Terminating 403(b) PlansRevenue Ruling 2020-23PDF describes the actions a 403(b) plan funded through Section 403(b)(7) custodial accounts can take to properly terminate the plan. September 14 Live Webcast: What You Should Know About Your Retirement Plan The IRS is participating in live English and Spanish webcasts with the Department of Labor. These webcasts will help participants in a retirement plan understand how their plan works and what benefits they’ll receive. What You Should Know About Your Retirement Plan (English) September 15, 2020, 2:00 – 3:30 p.m. EDT Register What You Should Know About Your Retirement Plan (Spanish) September 22, 2020, 2:00 – 3:30 p.m. EDT Register Joint Board Announces Temporary Waiver of ‘Physical Presence’ Education Requirement for Enrolled Actuaries The Joint Board for the Enrollment of Actuaries announced that it’s waiving the physical presence requirement for continuing professional education (CPE) credit for any formal programs conducted from Jan. 1, 2020, through Dec. 31, 2022. Operational Compliance List The Operational Compliance List has been updated to include 2020 legislation and guidance to help plan sponsors identify changes that may affect their plan’s compliance. Changes to User Fees, Effective Jan. 4, 2021 The IRS released Announcement 2020-14 PDF that describes an increase in user fees for certain requests for letter rulings and determinations beginning Jan. 4, 2021. Issue Snapshots Each Issue Snapshot discusses a retirement plan issue and includes technical resources as well as audit tips and issue indicators. The most recent Issue Snapshots from Employee Plans are: Section 457(b) Plan of Governmental and Tax-Exempt Employers -- Catch-Up Contributions 403(b) Plans - Catch-Up Contributions August 24 Statutory Hybrid Plans Amended Determination Letter Requests Revenue Procedure 2019-20PDF opened the determination letter program for amended individually designed statutory hybrid plans to submit determination letter applications during the 12-month period ending on August 31, 2020. Some practitioners and plan sponsors have informed us that they’re having difficulty obtaining documents and information to file a complete submission by August 31, 2020. Because of the difficulty in obtaining documents and information, applicants that submit applications by August 31, 2020, that are not complete may supplement their applications through the end of 2020. An application submitted by the August 31, 2020, deadline will need to contain, at a minimum, the following documents: Form 5300, Application for Determination of Employee Benefit Plan; Form 8717, User Fee for Employee Plan Determination Letter Request, with appropriate user fee; and Form 8821, Tax Information Authorization, or Form 2848, Power of Attorney, if applicable. Indicate in the cover letter that the application is made pursuant to Rev. Proc. 2019-20 Amended Hybrid Plan. Additionally, in the cover letter, the applicant should provide an address or fax number to which the IRS will send an Application Identification Sheet for additional documents and information. To ensure that separate submissions are maintained in the same case file, include the Application Identification Sheet fl with any further submissions so that any documents or information sent after the initial submission can be associated with the initial determination letter application. As part of processing the applications, EP Determinations will not review a hybrid plan determination letter application described above for completeness until at least January 1, 2021. When EP Determinations reviews the application for completeness, the procedures in section 10 of Rev. Proc. 2020-4 will apply. Sections 10 and 11 of Rev. Proc. 2020-4 provide a list of items required for a complete determination letter application. Once a determination letter application is assigned to a Determinations Specialist, in accordance with section 10.11 of Rev. Proc. 2020-4, the Specialist will review the application and send a letter to the taxpayer (and representative, if applicable) if the submission is incomplete. The letter will provide the applicant 21 days to submit any information or documents missing from the application. If anything is still missing after 21 days, the Specialist will send a final letter that provides the applicant 30 days to submit the remaining documents or information necessary to process the application. If a complete response is not received by the response deadline, the case will then be closed. Applications for determination letters for amended hybrid plans submitted after August 31, 2020, whether complete or incomplete, will be returned for missing the 12-month period provided in Rev. Proc. 2019-20. August 10 Defined Contribution 3rd Cycle filings for ESOPs Announcement 2020-7PDF opened the 3rd cycle submission period for employers with eligible defined contribution (DC) plans to apply for a determination letter using Form 5307 starting August 1, 2020, through July 31, 2022. The 3rd DC cycle includes Employee Stock Ownership Plans (ESOPs) for the first time. The Form 5307 is being updated for the addition of ESOPs to the program; however, it won’t be available for the start of the 3rd cycle. Therefore, ESOP applications submitted on the current Form 5307 should be completed as follows: Question 5a should be marked “6” - profit sharing plan, The cover letter should state: the submission is for an ESOP, if the plan sponsor is a S or C corporation, and if there was a change to the corporate status (from S to C or C to S revocation/election). If so, provide the effective date of such change. This request is limited to ESOP applications submitted on the current Form 5307 until the revised Form 5307 is available. Providing the information above will minimize the need for follow up correspondence when reviewing applications on the current Form 5307. Third Cycle Pre-approved Defined Benefit Submission Window Opens August 1, 2020 The IRS issued Revenue Procedure 2020-10PDF in December 2019 that established the on-cycle submission period for pre-approved defined benefit plans. It enables plan providers to submit applications for opinion letters on 3rd cycle pre-approved defined benefit plans starting August 1, 2020 through July 31, 2021. Please note the following when filing your 3rd cycle submission: We request that you submit applications by thumb or flash drive instead of submitting large paper files. Save the documents in Microsoft Word or Adobe Acrobat PDF format. We strongly encourage you to take advantage of this electronic submission method. We also ask that you continue submitting paper checks and paper Forms 8717-A for your fees. We would also request a redline copy of your plan document for changes made since the last cycle. This will greatly assist in quicker review by the IRS. The Cumulative List for the 3rd cycle was published in Notice 2020-14 PDFand will be the basis for our review of 3rd cycle submissions. The List of Required Modifications (LRM) can be used to help draft your plan. If you have any questions or concerns which can’t be answered from a review of Rev. Proc. 2017-41PDF, please contact either Angelo Noe at angelo.c.noe@irs.gov, or Milo Atlas at milo.s.atlas@irs.gov. July 24 IRS Employee Plans is publishing a series of articles to help plan sponsors and taxpayers properly maintain and administer their retirement plans. This article covers the upcoming filing deadlines that apply to most retirement plans. Plan Filing Deadlines The 2019 Form 5500 is due on July 31, 2020, for calendar year plans. Plan sponsors who file Form 5558 by July 31, 2020, get an automatic 2 ½-month extension of time to file. The plan sponsor will also be granted an automatic extension of time to file Form 5500 through the due date of its federal income tax return if the plan year and the plan sponsor’s tax year are the same, and the plan sponsor has been granted an extension of time to file its federal income tax return to a date later than the normal due date for filing the Form 5500. The deadline for adopting a pre-approved defined benefit plan for the 2nd six-year remedial amendment cycle was extended to July 31, 2020. You must adopt a restated plan by that date to keep pre-approved defined benefit plan status. The deadline to file an individual determination letter request for pre-approved defined benefit plans was also extended to July 31, 2020. See Notice 2020-35PDF for more details. The deadline to file a determination letter application for an individually designed statutory hybrid plan is August 31, 2020. See Rev. Proc. 2019-20 for more details. Form 5330 may be due on July 31, 2020, for a calendar year-based plan that must pay an excise tax. Generally, excise taxes filed on Form 5330 are due on the last day of the 7th month after the end of the plan sponsor’s tax year. Form 5558 may be filed to get a 6-month extension to file Form 5330. However, the extension to file Form 5330 does not extent the time to pay the excise taxes. Employee Plan Compliance Resolution System (EPCRS) The correction programs under EPCRS are available to help plan sponsors correct mistakes in their qualified plans, 403(b) plans, and SEP and SIMPLE IRA plans for operational and plan document failures related to their plans. Self-Correction Program: SCP is available to correct operational failures and certain plan document failures. Voluntary Correction Program: VCP is available to correct all operational and plan document failures. The voluntary closing agreement program is available to correct mistakes in plans not covered by EPCRS. May 1 Job Announcements in IRS Tax Exempt & Government Entities The IRS has announced multiple Internal Revenue Agent job openings in both Employee Plans and Exempt Organizations as part of the IRS Pathways Recent Graduate Program. These positions are open in multiple cities and have a starting pay scale of GS 5–9. Revenue agents in Employee Plans examine the books and records of employer sponsored retirement plans such as 401(k) plans. You can learn more about, and apply for, one of the recent graduate positions on USAjobs.gov, but you need to hurry. These job openings close on May 8, 2020. Issue Snapshots Each Issue Snapshot discusses a retirement plan issue and includes technical resources along with audit tips or issue indicators. The most recent Issue Snapshots from Employee Plans are: Design-based Safe Harbor Plan Compensation - A design-based safe harbor plan that bases allocations on compensation must use a nondiscriminatory definition of compensation. Plan Loan Cure Period - This snapshot discusses common scenarios of cure periods for missed payments on participant loans. Plan Termination: Failure to Time Distribute Assets - A terminated plan that doesn’t distribute all assets as soon as administratively feasible must continue to meet the requirements of an ongoing plan. Hardship Distributions from 401(k) Plans - This snapshot examines the criteria for hardship distributions. 2019 Expand/Collapse All December 23 Required Minimum Distributions You may need to take a required minimum distribution from your IRA or retirement plan account by the end of the year: If you’re at least age 70½ this year, or If you’ve inherited an IRA or retirement account. Recent legislation, known as the Secure Act, does not affect required minimum distributions for the 2019 tax year. The Secure Act Recent legislation, commonly known as the Secure Act, raises the age for required minimum distributions to 72 beginning in 2020. It also removes the age limit for contributions to traditional IRAs beginning in 2020. This legislation does not affect the rules for 2019. If you’re at least 70½ in 2019, you must take a required minimum distribution. And you’re not allowed to make contributions to your traditional IRA for 2019 after age 70½. 403(b) plans 403(b) plans have until March 31, 2020, to update their 403(b) plan documents for all current law. Revenue Procedure 2019-39PDF establishes a remedial amendment period for individually designed plans after March 31. Plan amendment deadlines set for new hardship rules The IRS released the annual required amendment list for individually designed qualified plans and 403(b) plans in Notice 2019-64PDF. Sponsors of individually designed 401(k) and 403(b) plans have until December 31, 2021, to adopt amendments to meet the requirements of the final hardship regulations. Revenue Procedure 2020-09PDF extended the deadline for adopters of pre-approved plans until December 31, 2021, to adopt an interim amendment for the final hardship regulations. Withholding from periodic payments Notice 2020-03PDF provides guidance for withholding from periodic payments for pensions, annuities, and certain other deferred income in 2020. The IRS is also requesting comments on the potential adoption of a new default rate of withholding after 2020. IRS Advisory Council issues 2019 Annual Report The Internal Revenue Service Advisory Council (IRSAC) issued its 2019 annual report, including recommendations to the IRS on tax administration. December 2 New Mailing Address for Employee Plans Submissions Effective immediately, please use the mailing addresses below for Forms 5300, 5307, 5310, 5310-A, 5316, 8717, 8718 and 8940. Regular U.S. Postal Service mail: Internal Revenue Service P.O. Box 12192 TE/GE Stop 31A Team 105 Covington, KY 41012-0192 Deliveries by private delivery service: Internal Revenue Service 7940 Kentucky Drive TE/GE Stop 31A Team 105 Florence, KY 41042 If you’ve had your submission returned to you undeliverable, please resubmit using one of the above addresses. Check out EP submissions for more information on the forms affected by the address change. November 15 Cost-of-Living Adjustments The IRS released the 2020 COLA limits for retirement plans and IRAs. See which contribution, deferral and compensation limits have increased for 2020. You may also want to review the tax year 2020 annual inflation adjustments for more than 60 tax provisions, including the tax rate schedules and other tax changes. IRS Website Study For a limited time, you can take the website improvement study to help us improve access to the IRS.gov retirement plan webpages. This online study should take you about ten minutes, start to finish. Excess Annual Salary Deferrals Consequences to plan participants who contribute more than the annual salary deferral limit to an individual account can include income taxes and penalties. All Current PTINs Expire December 31, 2019 The IRS is urging tax professionals to renew their Preparer Tax identification Numbers now to avoid a last-minute rush. Application Period for Enrolled Agents The 2020 Enrollment Renewal Application Period for EAs is open from now through January 31, 2020. Check if your current enrollment is set to expire on March 31, 2020. October 29 Final hardship regulations The IRS released final regulations that make changes to hardship distributions in 401(k) and 403(b) retirement plans. The final regulations also include changes made by the Bipartisan Budget Act of 2018. Pre-approved 403(b) plan deadline Employers have until March 31, 2020, to adopt a pre-approved 403(b) plan under Revenue Procedure 2017-18. Eligible employers may adopt a pre-approved plan as a restatement to correct any form defects from January 1, 2010. Pre-approved defined benefit plan deadline April 20, 2020, is the deadline for a plan sponsor to adopt a restatement of their pre-approved defined benefit plan. This deadline also applies to plan sponsors switching from an individually designed to a pre-approved defined benefit plan. Uncashed distribution checks The IRS issued Revenue Ruling 2019-19 on the taxation of uncashed distribution checks from qualified retirement plans. This guidance only covers mandatory distributions. September 12 New Mailing Address for Employee Plans Submissions Effective immediately, the mailing address for EP submissions for determination letters, letter rulings and IRA opinion letters is: Internal Revenue Service 7940 Kentucky Drive MS 31A Florence, KY 41042 This new address should be used for all deliveries, including U.S. Postal Service, FedEx and UPS. The address for pre-approved plan submissions has not changed. Check out the complete list of submissions affected by the address change. Determination Letter Program Revenue Procedure 2019-20PDF expanded the determination letter program. Plan sponsors may now submit determination letter applications for: Statutory hybrid plans – from September 1, 2019, through August 31, 2020. Plan mergers – certain merged plans on a continuing basis. A limited extension of the remedial amendment period is also available for certain plans submitted under Rev. Proc. 2019-20. Plan sponsors may continue to submit determination letter applications for initial plan qualification and for qualification upon plan termination, as provided in Rev. Proc. 2016-37. June 28 Changes to forms used on Pay.gov for IRS Voluntary Correction Program submissions The IRS updated Forms 8950 and 8951 on Pay.gov used for Voluntary Correction Program (VCP) submissions. Form 8950, Application for VCP Submission: Updates to the “Before you begin” landing page include: Employers or authorized plan representatives may use the same Pay.gov username to submit multiple Forms 8950 for different plans or employers. Applicants may now submit larger faxes, up to 150MB. Include the Pay.gov tracking ID number, the applicant’s name and EIN, and plan name on the fax coversheet. Updated citations and edits for clarity. Form 8950, page two - Penalty of Perjury Statement Revised the penalty of perjury statement to clarify: Authorized representatives submitting a VCP submission on behalf of an employer are not signing under penalty of perjury. Instead, they are certifying their status as documented on an included Form 2848, Power of Attorney. The VCP submission must include a signed and dated penalty of perjury statement completed by the employer. Form 8951, Additional Payment for Open VCP Updates to the “Before you begin” landing page include: Employers or authorized plan representatives may use the same Pay.gov username to submit multiple Forms 8951 for different plans or clients. Learn more about VCP at Correcting Plan Errors. Pre-approved Second Cycle Cash Balance Plan - use of a lookback month and stability period when using a Treasury-based interest crediting rate Pre-approved Cash Balance plans were first permitted for the second Cycle. Announcement 2018-05 gives adopting employers of pre-approved plans Cash Balance until April 30, 2020, to restate their plans to be timely for the second Cycle. The Defined Benefit Listing of Required Modifications (LRM) Cash Balance SupplementPDF provides language that meets the requirements of the pre-approved program. Section 26CB.I.B.4. of the LRM contains Treasury-based interest crediting rates for purposes of a cash balance plan’s hypothetical account. A plan is permitted to specify a look back month and stability period for purposes of determining the Treasury-based interest rate for the interest credit period; however, this is not currently addressed in the LRM. If a sponsor, practitioner, or employer amends their pre-approved cash balance plan to specify a look back month and stability period, reliance on the second cycle (PPA) opinion or advisory letter will not be jeopardized. May 2 Determination Letter Program The IRS released Revenue Procedure 2019-20PDF, in response to comments we received, which expands the determination letter program to include: Statutory hybrid plans – plan sponsors may submit determination letter applications for statutory hybrid plans from September 1, 2019, through August 31, 2020. Plan mergers – plan sponsors may submit determination letter applications for certain merged plans on a continuing basis. Remedial amendment period - a limited extension of the remedial amendment period and a special sanction structure. Plan sponsors may continue to submit determination letter applications for initial plan qualification and for qualification upon plan termination, as provided in Rev. Proc. 2016-37. Operational Compliance List The Operational Compliance List includes legislation and guidance that can help plan sponsors identify changes that may affect their plan’s compliance. Hardship Distributions The Bipartisan Budget Act of 2018 enacted three changes to the hardship distributions rules effective for hardship distributions made in 2019 (may also be relied on for 2018): repealed the previously-required 6-month suspension of elective deferrals after a participant received a hardship distribution amounts previously contributed as qualified non-elective or qualified matching contributions (QNECs/QMACs) are available as a hardship distribution. removed the requirement to take available plan loans prior to requesting a hardship. Proposed regulation for hardships: revise the standards governing when a distribution can be made on account of hardship. permit hardship distributions to participants seeking to repair a primary residence, even if that repair would not otherwise qualify for a casualty loss deduction. apply most of these rules to participants in 403(b) arrangements. Other hardship resources: Proposed regulation 107813-18PDF Retirement Plans FAQs regarding Hardship Distributions Do's and Don'ts of Hardship Distributions Hardship Distribution Tips from EP Exam Treasury Reg. Section 1.401(k)-1(d)(3) 401(k) Plan Hardship Distributions - Consider the Consequences Expanded Self-Correction Program The IRS expanded the Self-Correction Program (SCP) in Rev. Proc. 2019-19 to make it easier to self-correct certain retirement plan mistakes. Expanded SCP permits: The self-correction of certain plan document failures, Correction options and possible relief from deemed distributions associated with specified failures involving plan loans made to participants, and Additional opportunities for correcting certain operational failures by plan amendment April 19 Expanded Self-Correction Program – Rev. Proc. 2019-19 The IRS expands its Employee Plans Compliance Resolution System self-correction program (SCP) in Revenue Procedure 2019-19, effective April 19, 2019, to make it easier to fix various failures. This expansion includes: Using SCP to resolve certain plan document failures, Correction options and possible relief from deemed distributions associated with specified failures involving plan loans made to participants, and Additional opportunities for correcting certain operational failures by plan amendment. VCP Submissions Must be Made Electronically Beginning April 1, 2019, you must make all Voluntary Compliance Program submissions electronically using Pay.gov. Any paper VCP submissions postmarked after March 31, 2019, will be returned to the applicant. April 18 Pre-Approved Retirement Plan Adopting Employers FAQs These FAQs can help you determine how to switch to a pre-approved plan, when you need to adopt a new version of your pre-approved plan and more. Notice 2018-74PDF This notice modifies the two safe harbor explanations in Notice 2014-74 that must be provided to recipients of eligible rollover distributions. It considers recent guidance and law changes, including changes related to qualified loan offsets made by the Tax Cuts and Jobs Act of 2017. Form 8880 Use Form 8880, Credit for Qualified Retirement Savings Contributions, to figure the amount, if any, of your Saver’s Credit. For 2018, you can take the Saver’s Credit for traditional and Roth IRA contributions, ABLE contributions by the designated beneficiary, and salary deferrals or other employee contributions to a 401(k) or other qualified retirement plan. Form 8915 Use Form 8915-A, Qualified 2016 Disaster Retirement Plan Distributions and Repayments, if you were adversely affected by a 2016 disaster and you received a distribution that qualifies for favorable tax treatment. Use Form 8915B, Qualified 2017 Disaster Retirement Plan Distributions and Repayments, if you were adversely affected by a 2017 disaster and you received a distribution that qualifies for favorable tax treatment. Both qualified 2017 disaster distributions and repayments of qualified 2017 disaster distributions can be made in 2018. Revenue Ruling 2019-06, Covered Compensation TablesPDF IRS updated the tables of covered compensation under Internal Revenue Code Section 401(l)(5)(E) for the 2019 plan year. These tables are used to determine contributions to defined benefit plans and permitted disparity. March 14 IRS Retirement Plan Correction Program The IRS maintains a correction program that permits any size business or organization that sponsors a retirement plan (including SEP and SIMPLE IRA plans) to identify and correct problems they find. This correction program, the Employee Plans Compliance Resolution System (EPCRS), is outlined in Revenue Procedure 2018-52PDF. Under the Self-Correction Program (SCP), you can correct many plan mistakes without contacting the IRS. Identify and correct mistakes using the procedures in EPCRS. Do not notify the IRS. Pay no fees to the IRS. Your plan’s tax benefits are preserved. The Voluntary Correction Program (VCP) works for mistakes that are not eligible for self-correction or if you want IRS assurance about how you corrected a mistake. You must make a written submission and pay a compliance fee to the IRS, prior to an IRS audit. Disclose the self-identified problems along with a proposal to fix them. The IRS determines if the proposal is acceptable and issues a compliance statement documenting approval. Your plan’s tax benefits are preserved. If you want to learn how to find and correct mistakes in a small business retirement plan, visit Correcting Plan Errors. Information on that webpage, including the Fix-it-Guides, can help you learn how to use the IRS correction program to correct mistakes in your retirement plan. VCP Submissions on Pay.gov Beginning April 1, 2019, you must make all VCP submissions electronically through Pay.gov. Any paper VCP submissions sent to the IRS with a postmark after March 31, 2019, will be returned to the applicant. Note the following tips when making a VCP submission electronically through Pay.gov: A VCP application is not considered filed with the IRS until the VCP user fee has been paid and the Pay.gov website generates a payment confirmation receipt. If you don’t have a receipt with a Pay.gov Tracking ID #, you haven’t made a VCP submission to the IRS. Please include all required VCP submission items in your PDF file that’s uploaded to the IRS. See Rev. Proc. 2018-52, section 11.04 and, if applicable, enclosure lists associated with the model VCP submission forms in the Form 14568-A through Form 14568-I series. The completed Form 8950 is uploaded automatically, so don’t include any copy of the Form 8950 as part of the uploaded PDF file containing the VCP submission documents. Place the VCP submission documents in the uploaded PDF in the order specified by Rev. Proc. 2018-52, section 11.11. Prior to making a submission, please review the electronic VCP submission process outlined in Revenue Procedure 2018-52PDF. For more information, check out this IRS video. 2018 Expand/Collapse All December 14 Form 4461-B Use revised Form 4461-B for approval of a plan submitted by a mass submitter on behalf of an adopting sponsor or practitioner, which is based on a plan submitted by the mass submitter. Notice 2018-91PDF This notice contains the Required Amendments List for qualified retirement plans for 2018. Rev. Proc. 2018-52 – New Electronic VCP Submission Process New video discusses existing and new procedures for filing VCP submissions with the IRS. Notice 2018-95PDF This notice provides transition relief for the once-in-always-in condition for excluding part-time employees in a 403(b) plan. November 2 IRSAC expands to cover more areas of the IRS; IRPAC and ACT to join centralized advisory committee in 2019 The IRS announced that the Internal Revenue Service Advisory Committee’s (IRSAC) role will expand in 2019 to have a wider portfolio and will incorporate the Information Reporting Program Advisory Committee (IRPAC) and the Advisory Committee on Tax Exempt and Government Entities (ACT). Although ACT will no longer exist, the IRS emphasizes that TE/GE issues will remain a priority area in the expanded IRSAC. 401(k) contribution limit increases to $19,000 for 2019; IRA limit increases to $6,000 The Internal Revenue Service announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2019. October 26 IRS Nationwide Tax Forum presentations Tax professionals can earn continuing education credits by viewing seminars from the Tax Forums. The summer 2018 sessions are now available online. 2019 TE/GE Program Letter Read about where IRS Employee Plans is heading this fiscal year, including executing compliance strategies, building better processes and providing guidance on the Tax Cuts and Jobs Act. October 1 Revenue Procedure 2018-52PDF, released September 28, 2018: modifies the Employee Plans Compliance Resolution System (EPCRS), replaces Revenue Procedure 2016-51, is effective as of January 1, 2019, and significantly changes how Voluntary Correction Program (VCP) submissions are made to the IRS. September 21 Revenue Procedure 2018-42PDF – extends the deadline for submitting on-cycle applications for opinion letters for pre-approved defined contribution plans for the third six-year remedial amendment cycle to December 31, 2018. Notice 2018-69PDF – extends the temporary nondiscrimination relief for closed defined benefit plans for plan years beginning before 2020 if certain conditions are met. Avoid Making an Incomplete VCP Submission – explains how to avoid common mistakes in Voluntary Compliance Program submissions. Notice 2018-74PDF – modifies two safe harbor explanations plan sponsors may use to satisfy the IRC Section 402(f) requirement to provide information to eligible rollover distribution recipients. Forms Draft Form 1099-RPDF – submit your comments about draft Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., to IRS.gov/formscomments. August 14 IRS releases new revisions of Forms 14568-B, 14568-E and 14568-H, Model VCP Schedules - plan sponsors can use these forms as part of their submission to the IRS Voluntary Correction Program (VCP) Qualified Matching Contributions (QMACs) and Qualified Nonelective Contributions (QNECs) - IRS and Treasury release final regulations amending the definitions of QMACs and QNECs. Under these regulations, an employer contribution may be a QMAC or QNEC if it satisfies applicable nonforfeitable requirements and distribution limitations at the time it is allocated to participants accounts Updated forms Form 4419, Application for Filing Information Returns Electronically (FIRE)PDF Instructions for Forms 1099-R and 5498, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.PDF June 8 Issue Snapshots Issue Snapshots are IRS employee job aids that provide analysis and resources along with audit tips or issue indicators for retirement plan topics. The most recent Issue Snapshots for retirement plans are: Treatment of 415(c) Dollar Limitations in a Short Limitation Year - How to adjust the IRC Section 415(c) defined contribution dollar limitation for a short limitation year, resulting from, for example, an initial, amended or terminating plan year. Treatment of 401(a)(17) Limitation in Defined Contribution Plan in a Short Plan Year - How to adjust the IRC Section 401(a)(17) limit in a short plan year, such as an initial, amended or terminating plan year. Borrowing Limits for Participants with Multiple Plan Loans - A qualified retirement plan may permit a participant to have multiple loans if IRC Section 72(p) is satisfied. Qualification Requirements for Non-Electing Church Plans under IRC Section 401(a) - Identifies sections of the Internal Revenue Code that a non-electing church plan must satisfy to be a qualified plan under IRC Section 401(a). Vesting Schedules for Matching Contributions - The different vesting requirements for matching contributions to a defined contribution plan, other than a non-electing church plan or a governmental plan. Plan Forfeitures Used for Qualified Nonelective and Qualified Matching Contributions - Proposed Treasury Regulations change one of the rules governing qualified nonelective contributions and qualified matching contributions. EP & EO participating in 2018 IRS Nationwide Tax Forums - TE/GE, Employee Plans and Exempt Organizations will participate in the 2018 IRS Nationwide Tax Forums in five cities starting in July. April 20 Notice 2018-24PDF - Request for Comments on Scope of Determination Letter Program for Individually Designed Plans During Calendar Year 2019 – please submit your comments in writing by June 4, 2018 March 26 Join the IRS for a National Paycheck Checkup Thunderclap We invite you or your group to join @IRSnews in support of the IRS Thunderclap effort promoting a national “Paycheck Checkup.” Following major tax law changes, workers should review their withholding to make sure they have the right amount of tax taken out of their paychecks. Revenue Procedure 2018-21PDF – allows pre-approved defined benefit plans containing a cash balance formula to provide the actual rate of return on plan assets as the rate used to determine interest credits. Adoption deadline PDF– for employers who want to adopt pre-approved defined benefit plans with opinion/advisory letters. Missing Participants and Beneficiaries and Required Minimum Distributions – 403(b) Plans – IRS memo directs Employee Plans examiners not to challenge a 403(b) plan as failing to meet the required minimum distribution standards under certain conditions. Contribute to your retirement plan or IRA: IRA Contribution Limits 401(k) and Profit-Sharing Plan Contribution Limits How much can I contribute to my self-employed SEP plan if I participate in my employer’s SIMPLE IRA plan? How Much Salary Can You Defer if You’re Eligible for More than One Retirement Plan? Updated forms and publications Form 8915-APDF, Qualified 2016 Disaster Retirement Plan Distributions and Repayments (instructionsPDF). About Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. - use distribution code 2 on Form 1099-R to report retirement plan (including IRAs) participant distributions made in 2017 due to Hurricanes Harvey, Irma or Maria. Publication 575, Pension and Annuity Income. Form 5310 Retroactive User Fee Change (Rev. Proc. 2018-19)PDF. Refunds Worth $1.1 Billion Waiting to be Claimed Unclaimed federal income tax refunds totaling $1.1 billion may be waiting for one million taxpayers who did not file a 2014 federal income tax return. Time is running out. To collect these refunds, taxpayers must file their 2014 tax return by April 17, 2018. Protect Yourself from Identity Theft The IRS reminds you that every year, people fall prey to tax scams. Three of the scams on the list of 2018 Dirty Dozen Tax Scams include: Phone Scams - Callers claiming to be IRS officials threaten police arrest, deportation or license revocation if the victim doesn’t pay a bogus tax bill. Phishing - Taxpayers need to be on guard against fake emails or websites looking to steal personal information. Criminals may pose as a person in your organization you trust or recognize, requesting sensitive information. Identity Theft - Criminals sometimes file fraudulent returns using information from a phishing scam, with a refund being deposited into the taxpayer’s bank account. They then use a phone scam to claim to be the IRS and ask for that money back. January 29 Model Language for Pre-Approved Defined Contribution Plans - providers applying for IRS opinion letters during the third defined contribution pre-approved plan cycle (October 2, 2017 - October 1, 2018) may use the Listings of Required Modifications (LRMs) to draft or amend their plans. IRA FAQs - Recharacterization of Roth IRA Contributions – updated for the recharacterization rules of the Tax Cuts and Jobs Act (Pub. L. No. 115-97). Voluntary Correction Program – kits and guides updated for revised user fees: Voluntary Correction Program submission kits Fix-it Guides Updated forms and publications: Publication 571, Tax-Sheltered Annuity Plans (403(b) Plans) For Employees of Public Schools and Certain Tax-Exempt Organizations 2017 Form 5329 (PDF, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts Publication 915, Social Security and Equivalent Railroad Retirement Benefits 2017 Instructions for Form 8955-SSAPDF, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits Publication 3066PDF, Have you had your check-up this year? for Retirement Plans Publication 3998PDF, Choosing a Retirement Solution for Your Small Business Publication 4336PDF, Salary Reduction Simplified Employee Pension Plan for Small Businesses Publication 4407PDF, Salary Reduction Simplified Employee Pension (SARSEP) - Key Issues and Assistance Publication 4530PDF, Designated Roth Accounts under 401(k), 403(b) or governmental 457(b) plans Retirement Plan Reporting and Disclosure Requirements (IRS) 2017 Instructions for Form 5500-EZPDF, Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan January How to Obtain or Re-Establish an EIN for a Retirement Plan Trust - instructions for obtaining an EIN for a retirement plan trust. November 2017 EA-2F ExaminationPDF - Enrolled Actuaries Pension Examination, Segment F 2017 Expand/Collapse All December 2017 Required Amendments List for Qualified Retirement PlansPDF - changes in retirement plan qualification requirements and amendment deadlines for individually designed plans (Notice 2017-72). Disaster relief retirement plan distribution and loan options – allows recent hurricane victims to access funds from their retirement plans and allows retroactive plan amendments. Required minimum distributions for missing participants, beneficiaries - explains steps a qualified retirement plan sponsor may take to avoid an IRS challenge to the plan’s obligation to make RMDs to missing recipients. Form 5300, Application for Determination for Employee Benefit Plan, revised for changes in format and information required. Prohibited loans to an employerPDF – two examples of when these loans from an Internal Revenue Code Section 403(b)(9) retirement income account violate the exclusive benefit rule (IRS Chief Counsel Memo 201742022). Updated Listing of Required Modifications (LRMs) and Information Packages – sponsors may use the updated and new sample plan provisions to draft defined contribution, pre-approved Employee Stock Ownership, and cash or deferred arrangement plans. 2017 Forms 5500 and 5500-SF – highlights of changes to these forms, their schedules and instructions. Publication 4810PDF, Specifications for Electronic Filing of Form 8955-SSA, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits. Retirement savings tips With 2017 Extension Deadline Passed, All Eyes on 2018 – Read tax tip on IRA contributions and deductions Save for Retirement Now, Get a Tax Credit Later; Saver’s Credit Helps Low, Moderate Income Workers (IR-2017-186). October Cure period under Code Section 72(p) for missed loan prepaymentsPDF – IRS Chief Counsel Advice Memorandum 201736022 gives two examples on making up missed installment loan payments. Defined benefit plans Procedures for automatic approval for certain changes in funding methodPDF – For single-employer defined benefit plans subject to the minimum funding requirements of Internal Revenue Code (IRC) Section 430 (Revenue Procedure 2017-56). Updated procedures for obtaining IRS approval for a change in funding methodPDF – Guidance includes procedures for defined benefit plan sponsors to revoke certain interest rate elections (Rev. Proc. 2017-57). Updated Static Mortality TablesPDF – Use these tables to determine minimum present value under IRC Section 417(e)(3) and ERISA Section 205(g)(3) for certain distributions in 2018 (Notice 2017-60). Final regulations - mortality tables for determining present value – Provide mortality tables that single-employer defined benefit plan sponsors must use to determine minimum required contribution and guidance about construction of substitute mortality tables (T.D. 9826). New procedures to request to use plan-specific substitute mortality tablesPDF – Certain defined benefit plans must follow these procedures for plan years beginning on or after Jan. 1, 2018 (Rev. Proc. 2017-55). Updated forms Form 4972, Tax on Lump-Sum DistributionsPDF – Qualified plan participants born before Jan. 2, 1936, can use this form to calculate taxes on lump-sum distributions. Form 8881, Credit for Small Employer Pension Plan Startup CostsPDF – Eligible small employers can claim a credit for establishing or administering certain retirement plans for their employees. September Podcast – computation of maximum loan amount from retirement plans (8:21 mins) – describes how the IRS will review multiple loans to a participant during an audit Defined benefit plans Closed defined benefit plans now have reliefPDF from IRC Section 401(a)(4) nondiscrimination testing for plan years beginning before 2019 (Notice 2017-45) Model amendments for defined benefit plansPDF – plan sponsors may use model amendments to allow a combination of annuity and lump sum distributions (Notice 2017-44) Issue snapshots Issue Snapshots on retirement plan topics Partial terminations, improper forfeitures, otherwise excludable employees in 401(k) plans, compensation in safe harbor 401(k) plans, 457(b) written plan requirements and 403(b) plan aggregation for IRC 415(c) are new on this list Updated publications Publication 4482, 403(b) Tax-Sheltered Annuities for ParticipantsPDF – helps participants understand their retirement plan and avoid common mistakes Publication 4483, 403(b) Tax-Sheltered Annuities for SponsorsPDF – contains information for tax exempt organizations and public schools about these retirement plans Publication 1220, Specifications for Electronic Filing of Forms 1097, 1098, 1099, 3921, 3922, 5498, and W-2GPDF – includes a “First Time Filers Quick Reference Guide" about Form 4419, Application for Filing Information Returns Electronically (FIRE) Updated Form 5305 series model agreements (Financial institutions may use these forms immediately) Form 5305PDF, Traditional Individual Retirement Trust Account Form 5305-APDF, Traditional Individual Retirement Custodial Account Form 5305-RPDF, Roth Individual Retirement Trust Account Form 5305-RAPDF, Roth Individual Retirement Custodial Account Form 5305-RBPDF, Roth Individual Retirement Annuity Endorsement Form 5305-SPDF, SIMPLE Individual Retirement Trust Account Form 5305-SAPDF, SIMPLE Individual Retirement Custodial Account April 18 IRS asking for your comments on Form 5300, Application for Determination for Employee Benefit Plans, by June 6, 2017. Memo directs EP staff to review cash balance defined benefit plans' benefit formulas using the Definitely Determinable Benefits Issue Snapshot (TE/GE-04-0417-0014). Issue Snapshots and Memo 401(k) Automatic Contribution Arrangements - General Annual Participant Notice Investments in collectibles in individually-directed qualified plan accounts Definitely Determinable Benefits Now available Form 8955-SSA (2016)PDF, Annual Registration Statement Identifying Separated Participants with Deferred Vested Benefits Form 5500-EZ (2016)PDF, Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan March 21 Follow SIMPLE IRA withdrawal and transfer rules Be aware of dangerous W-2 Phishing Scam Evolving; Targeting Schools, Restaurants, Hospitals, Tribal Groups and Others(IR-2017-20) Read Publication 721 (2016), Tax Guide to U.S. Civil Service Retirement Benefits to prepare 2016 tax returnsPDF Contribute to an IRA for 2016; you have until April 18, 2017 (IR-2017-60) March 2 The Operational Compliance List identifies changes in plan qualification requirements effective in a calendar year to help sponsors and practitioners keep plans compliant 403(b) plan sponsors may self-correct violations of the IRC Section 403(b) written plan rules by March 31, 2020 Revenue Ruling 2017-05 contains the covered compensation tables for the 2017 plan year 401(k) plans: Catch-up contributions Issue Snapshot reviews the law, and contains analysis, audit tips and other resources Guidelines for substantiating safe-harbor hardship distributions from 401(k) plansPDF (TE/GE-04-0217-0008) IRA/retirement plan YouTube videos: IRA/Retirement Plan 60-Day Rollover Waivers (57 secs.) Updated: Publication 560 (2016)PDF, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans) Retirement Plan Reporting and Disclosure GuidePDF February 6 Determination Letter Program Use the correct version of Form 5300, Application for Determination for Employee Benefit Plan, to prevent processing delays or application return IRS reviews 2017 determination letter applications using Revenue Procedure 2016-37, Part II, Section 12 The Required Amendments List webpage explains and links to the new annual list of changes in retirement plan qualification requirements Small employers may be exemptPDF from determination letter application user fee for Jan. 1, 2017, and later filings (Notice 2017-1) Updated annual procedures for requesting EP determination letters and private letter rulings, and user fees (Rev. Proc. 2017-4) 403(b) Plans Remedial amendment period for 403(b) plansPDF ends March 31, 2020 (Rev. Proc. 2017-18) Universal availability Issue Snapshot explains and gives cites, resources and audit tips Proposed Regulations Prescribe mortality tables to determine present value under defined benefit plans; comments due March 29 (REG-112324-15) Amend the definitions of qualified matching contributions and qualified nonelective contributions; comments due April 18 (REG-131643-15) Saver’s Credit helps low-and-moderate-income workers save for retirement (IR-2016-171) Updated Forms and Publications Form 5300PDF, Application for Determination for Employee Benefit Plan (Instructions PDF) Form 8606PDF, Nondeductible IRAs (Instructions PDF) Publication 4810PDF, Specifications for Electronic Filing of Form 8955-SSA, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits Publication 575 (2016)PDF, Pension and Annuity Income Publication 590-A (2016)PDF, Contributions to Individual Retirement Arrangements (IRAs) Publication 590-B (2016)PDF, Distributions from Individual Retirement Arrangements (IRAs) 2016 Expand/Collapse All December 16 FIRE Production System, used to electronically file certain forms. including Form 8955-SSA, will be down until January 16, 2017, for yearly updates Additional instructions for Forms 8950 and 14568-B for Voluntary Compliance Program submissions beginning January 1, 2017 IRS Tax Calendar for Businesses and Self-Employed recorded webinar to learn how to track federal tax due dates, customize the online tax calendar, get reminders and more Notice 2016-67PDF, Applicability of IRC Section 411(b)(5)(B)(i) to Implicit Interest Pension Equity Plans Updated Publications Publication 4285PDF, SEP Checklist Publication 4286PDF, SARSEP Checklist Publication 4334PDF, SIMPLE IRA Plans for Small Businesses Publication 4587PDF, Payroll Deduction IRAs for Small Businesses Publication 4674PDF, Automatic Enrollment 401(k) Plans for Small Businesses Publication 4806PDF, Profit Sharing Plans for Small Businesses Taxpayer Security Reminders Tax Professionals: Protect Your Clients; Protect Yourself from Identity Theft (FS-2016-23) IRS, Partners Urge Strong Passwords Help Protect Identities at Tax Time and Beyond Avoid Identity Theft; Learn How to Recognize Phishing Scams IRS, Partners Add New Safeguard for 2017; Ask for Your Help to Combat Identity Theft IRS, Security Summit Partners, Remind Taxpayers to Protect Themselves Online (IR-2016-158) IRS, Security Summit Partners, Remind Taxpayers to Recognize Phishing Scams (IR 2016-160) Protect Your Clients: Security Summit Partners Warn Tax Pros of Cybercriminals, Launch New Awareness Tips (IR-2016-163) IRS Warns Taxpayers of Numerous Tax Scams Nationwide; Provides Summary of Most Recent Schemes (IR-2016-164) National Tax Security Week Concludes; IRS, Security Summit Partners Continues Work to Protect Taxpayers in 2017 (IR-2016-166) November 4 IRS announces 2017 pension plan limitations Read the 2017 limits on contributing to employer-sponsored retirement plans and IRAs New SIMPLE IRA Plan Listing of Required Modifications and Information Package [9-2016]PDF Sample plan language that satisfies specific Code requirements, as amended by the Protecting Americans From Tax Hikes Act of 2015 (Pub. L. 114-113) Presentation recordings now available for: Nondiscrimination Rules for Closed Pension Plans (July 21, 2016) Employee Plans Determination Letter Program Changes In 2017 (Aug. 11, 2016) SEP & SIMPLE IRA Plans: Strategies for Making Correct Contributions and Deductions (IRS Nationwide Tax Forums Online) Retirement plans can make loans, hardship distributions to victims of Hurricane Matthew (IR-2016-138) EP determination applications for Pension Equity Plans (IRS Field Directive) – explains how to apply IRC Section 411(b)(1)(G) accrued benefit rules Issue Snapshots on retirement plan topics Excess deferrals, change in vesting schedule, hardship distributions and safe harbor notice requirements are just a few on this list Updated Fix-it Guides – help you find, fix, and avoid common mistakes in your: SIMPLE IRA plan 403(b) plan October 12 Extension of temporary nondiscrimination reliefPDF for closed defined benefit plans through 2017 under certain conditions (Notice 2016-57) Deadline extended to Dec. 5 to submit comments on Form 5500 Modernization Proposals Updated IRS Checklists for retirement plan documents – used by IRS employees to review plans that apply for determination letter during the third Cycle A, due January 31, 2017 Employee Plans Compliance Unit (EPCU) projects: SIMPLE IRA Plans - Eligible Sponsors asked for information from sponsors who appeared to have more than 100 employees earning $5,000 or more. Partial Termination in plans that have a 20% or more decrease in participation and must fully vest affected employees. Ineligible Employer – 403(b) Project - designed to educate IRC Section 501(c)(3) organizations whose tax-exempt status had been automatically revoked per IRC Section 6033(j) to ensure an employer eligibility failure had not occurred in the sponsoring of an IRC Section 403(b) plan September 20 SubmitPDF comments on or before Dec. 15 on how plan sponsors can more easily comply with qualified plan documents requirements, especially in light of the changes to the determination letter program (Announcement 2016-32) Voluntary Correction Program Check out the Voluntary Correction Program to fix your plan Use VCP submission kit if you didn’t adopt an updated pre-approved defined contribution plan for the Pension Protection Act of 2006 by April 30, 2016 Correct by plan amendment under VCP if you made hardship distributions but your plan didn’t allow them Fix plan compensation errors when you didn’t follow your plan definition of compensation Hardship Distributions Understand the rules for hardship distributions Correct these common hardship distribution errors Permit loans, hardship distributions to Louisiana flood victims (News Release IR-2016-115) August 26 New 60-day waiver helps IRA, retirement plan rollovers News release (IR-2016-113) - new procedure helps people making IRA and retirement plan rollovers Accepting late rollover contributions - plans and IRAs can now accept late rollover contributions from individuals who self-certify they qualify for a 60-day rollover waiver FAQs - waivers of the 60-day rollover requirement (updated for Rev. Proc. 2016-47) Understanding the Universal Availability Rules in a 403(b) Retirement Plan - Webinar (May 19, 2016) - recording now posted Updated Simplified Employee Pension Plan Fix-it-Guide - tips on how to find, fix, and avoid common mistakes User Fee Forms (revised 9-2016) - Specific user fee amounts no longer listed on either Form 8717 or 8717-A, now entered on line 5 Form 8717PDF, User Fee for Employee Plan Determination Letter Request Form 8717-APDF, User Fee for Employee Plan Opinion or Advisory Letter Request July 29 Complete discontinuance of contributions can occur unless they are “recurring and substantial” for a profit sharing/401(k) plan Correct plan required minimum distribution mistakes using the Voluntary Correction Program IRS Compliance Statement – what you have to do after you get your statement Plan amendments are required for termination – review the newly posted 2015 Termination Focus Report July 13 New revenue procedure discusses when plan sponsors must amend an individually designed plan for new law and may request a determination letter After-tax amounts of designated Roth account distributions are allocated first to direct rollovers rather than pro rata to distributions to multiple destinations (Treas. Regs. 1.402A-1) Deferred compensation plansPDF of state, local government and other tax-exempt organizations – proposed rules for determining when amounts deferred are included in income (REG-147197-07) Draft Form 5300, Application for Determination for Employee Benefit Plan - simplifies information plan sponsors must provide May 18 Register for upcoming free webcasts: Understanding the Universal Availability Rules in a 403(b) Retirement Plan - May 19, 2016, 2 p.m. (Eastern) Accumulated Sick and Vacation Pay Deferred to 403(b) or 457(b) Plans - June 2, 2016, 2 p.m. (Eastern) Learn about retirement plans: 2016 IRS Nationwide Tax Forums - Employee Plans and Exempt Organizations will participate in forums being held in five cities starting in July Read EP Issue Snapshots - research summaries about various retirement plan topics, including the 403(b) written plan requirement, automatic contributions in church plans and expanded rollover options for SIMPLE IRA plans Correct plan failures: Correct nondiscrimination gateway test failures Consider an anonymous Voluntary Compliance Program submission Use VCP Submission Kit - if you didn’t adopt a restated pre-approved defined contribution plan by April 30, 2016 Learn recent guidance: Proposed nondiscrimination rulesPDF withdrawn for certain qualified retirement plan benefit formulas (Announcement 2016-16) Certain cash balance plansPDF may be eligible for the safe harbor rule for plans with indexed benefits (Chief Counsel Advice 201617006) Identify otherwise excludable employeesPDF for plan testing using latest permissible entry date (Chief Counsel memo 201605013) Disaster relief for retirement plan and IRAs – determine when certain retirement plan and IRA deadlines may be extended for affected taxpayers April 4 Correcting missed plan deadlines - new option for financial institutions or service providers who offer pre-approved plans to request a closing agreement for their plan sponsors who miss the April 30, 2016, adoption deadline 2016-2017 Priority Guidance PlanPDF - submit recommendations by May 16, 2016, to possibly include in the Plan (Notice 2016-26) Plan designs using short service - ensure plan contributions or benefits don’t discriminate in favor of highly compensated employees 2015 Form 5500-EZPDF, Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan (instructionsPDF) 457(b) plans: 457(b) plans for state or local governments: key characteristics including comparison chart to 401(k) plans 457(b) plans for tax-exempt entities: key characteristics, common mistakes and a comparison chart to governmental 457(b) plans Recorded webinars: Highlights of the 2015 Cumulative List of Changes for Retirement Plans (Feb. 18, 2016) - Learn about changes you must make to your plan (Notice 2015-84); if your plan can apply for determination letter during the third cycle A; and IRS resources to help you amend your plan IRS Tax Tips: Early retirement distributions and your taxes – know key points about taking an early distribution 2015 IRA contributions – there’s still time to make your IRA contribution for the 2015 tax year March 23 Financial advisors: are assets in your client’s one-participant plans more than $250,000? February 29 Mid-year amendments to safe harbor 401(k) plans and notices – new guidance helps plan sponsors comply with the safe harbor plan and notice rules (Notice 2016-6) 2015 Reference List – helps you update your plan for new items on the 2015 Cumulative List of Changes in Plan Qualification Requirements Publication 721 (01/2016)PDF, Tax Guide to U.S. Civil Service Retirement Benefits February 3 Determinations Revisions to the Employee Plans Determination Letter ProgramPDF: (Notice 2016-3) will update Revenue Procedure 2007-44 and: allow controlled groups and affiliated service groups that previously made a Cycle A election to submit determination letter applications during the third Cycle A submission period (February 1, 2016 - January 31, 2017); revoke any expiration dates on determination letters issued prior to January 4, 2016; and extend the period from April 30, 2016, to April 30, 2017, during which certain employers may establish or adopt a defined contribution pre-approved plan on or after January 1, 2016, and may, if eligible, apply for a determination letter. New Guidance Treatment of same-sex marriagesPDF – additional guidance for retirement plans (Notice 2015-86) Deadline for adoption of discretionary plan amendmentsPDF – interim guidance for EP Determinations and Examinations employees (TEGE-07-1215-0026) Updated Forms and Publications 2015 Form 5500-EZPDF, Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan (instructionsPDF) Publication 560 (01/2016)PDF, Retirement Plans for Small Business (SEP, SIMPLE, and Qualified Plans) Publication 590-A (01/2016)PDF, Contributions to Individual Retirement Arrangements (IRAs) 2016 Form 1099-RPDF, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, Etc. 2016 Form 5498PDF, IRA Contribution Information 2016 instructions for Forms 5498 and 1099-RPDF, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, Etc., and IRA Contribution Information Corrected mailing address for Form 5308PDF, Request for Change in Plan/Trust Year (Under section 412(d)(1) of the Internal Revenue Code): Internal Revenue Service Attn: EP Letter Rulings Stop 31 P.O. Box 12192 Covington, KY 41012-0192 Disaster relief for retirement plan and IRAs – determine when certain retirement plan and IRA deadlines may be extended for affected taxpayers January 8 IRS FIRE System (electronic filing for Form 8955-SSA and other information returns) is down for scheduled maintenance until Jan. 19 New Guidance: Annual determination letter procedures on the qualified status of employee plans (Rev. Proc. 2016-6) Annual user fees for private letter rulings, determination letters, and the Voluntary Correction Program compliance statements (Rev. Proc. 2016-8) Annual procedures for requesting technical advice memoranda (Rev. Proc. 2016- 2) Annual procedures for requesting letter rulings (Rev. Proc. 2016-4) Updated Forms: 2015 Form 8955-SSAPDF, Annual Registration Statement Identifying Separated Participants with Deferred Vested Benefits(instructionsPDF) 2015 Form 5329PDF, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts (instructionsPDF) Updated Publications: Publication 571PDF (01/2016), Tax-Sheltered Annuity Plans (403(b) Plans) For Employees of Public Schools and Certain Tax-Exempt Organizations Publication 575PDF (01/2016), Pension and Annuity Income Publication 590-BPDF (01/2016), Distributions from Individual Retirement Arrangements (IRAs) 2015 Expand/Collapse AllExpand/Collapse All December 21 2015 Cumulative ListPDF explains the changes in plan qualification requirements for retirement plans (Notice 2015-84) Year-end IRA reminders Form 5500 automatic extensionPDF to file has been changed back to 2½ months for 2016 and later calendar year plan filings. Section 32104 of the FAST Act (P.L. 114-94, HR 22 Dec. 4, 2015) has repealed the earlier automatic extension of 3 ½ months for filing Form 5500. Therefore, plans will only have a 2 ½ month automatic extension to file Form 5500 for 2016 and later calendar plan year filings. November 23 IRS Hearing Notice: Administration of Multiemployer Plan Participant Vote on an Approved Suspension of Benefits under the Multiemployer Pension Reform Act of 2014 (MPRA) - notice of public hearing on proposed regulations for the administration of a multiemployer plan participant vote on an approved suspension of benefits under the MPRA. The public hearing is Friday, December 18, 2015, at 10 a.m; you must send outlines of discussion topics for the public hearing by Monday, November 30, 2015 Most retirees need to take required retirement plan distributions by Dec. 31 - reminder for taxpayers born before July 1, 1945: you generally must receive payments from your IRAs and workplace retirement plans by Dec. 31 Register for December 8, 2015, 2 p.m. (Eastern) free webcast about the latest activities in Employee Plans Examinations Form 2848 InstructionsPDF - To reduce undeliverable mail and allow us to reach you sooner, remember to include your firm’s name, floor, suite or room number in your address November 9 Enrolled Retirement Plan Agent (ERPA) Program Changes – Registration for the final ERPA Special Enrollment Examination (ERPA SEE) to become an ERPA is open now and closes on January 4, 2016. November 3 IRS Announces 2016 Pension Plan Limitations - 401(k) contribution limit remains unchanged at $18,000 for 2016 IRS webinars and video Easy low-cost ways to start your small business retirement plan - Webinar - Learn about low-cost retirement plans; low-maintenance alternatives to traditional 401(k)s; points to consider in choosing a plan for your business; and resources for setting up and operating your plan, and avoiding plan mistakes (60 mins.) SEP and SIMPLE IRA Plans – Avoiding Pitfalls - Learn how to properly adopt and operate SEP and SIMPLE IRA plans; use the right compensation to calculate contributions; determine when employees participate in the plan; handle employees of related employers; and take steps to avoid errors. You can use the Audit button to watch for free (Nationwide Tax Forum, 50 mins.) September 30 Forms Draft of 2015 Form 8955-SSAPDF, Annual Registration Statement Identifying Separate Participants with Deferred Vested Benefits(August 7, 2015) Form 5500 automatic extensionPDF to file extends to November 15 for 2016 and later calendar year plan filings (P.L. 114-41, HR 3236, July 31, 2015) Procedures to request waiver of electronic filing of Forms 8955-SSA and 5500EZ based on undue economic hardship (Rev. Proc. 2015-47) Revised Forms 8950 and 8951- Sponsors may use prior versions of these Voluntary Correction Program forms until January 1, 2016 Correct plan mistakes Correcting retirement plan mistakes – listen to recorded webinar on updates to the Correction Program 403(b) plans - compare your written plan to its operation and fix any conflicts IRAs and IRA-based plans Beginning date for your first required minimum distribution from your IRA (including SEP and SIMPLE IRAs) is April 1 after the calendar year you turn 70½ Video on retirement plans discusses low-cost, low-maintenance IRA based plans Defined benefit plans: Determining minimum required contributions for single-employer defined benefit plans (final regulations 430) Cooperative and Small Employer Charity Act – guidance on minimum funding requirements for defined benefit plans maintained by groups of cooperatives and related entities, and groups of charities (Notice 2015-58) Administration of Multiemployer Plan Participant Vote on an Approved Suspension of Benefits Under Multiemployer Pension Reform Act of 2014 (MPRA) Proposed RegulationsPDF Temporary RegulationsPDF New look for Retirement Plans page - we’ve added categories that help you find what you're looking for July 31 The IRS and Treasury intend to amend the minimum distribution regulationsPDF for defined benefit plans to generally prohibit the replacement of ongoing annuity payments with a lump sum payment or any other form of accelerated payment. Employee Plans email questions - Beginning October 1, Employee Plans will no longer accept technical questions through email or from Customer Account Services. Changes to the Employee Plans Determination Letter ProgramPDF - Starting in 2017, the IRS will eliminate the staggered remedial amendment cycles and limit the scope of the determination letter program for individually designed plans. July 27 Small businesses can get IRS penalty relief for unfiled retirement plan returns - take advantage of a low-cost penalty relief program to quickly come back into compliance Welcome to Direct Pay! Use this secure service to pay your individual tax bill or estimated tax payment from your checking or savings account Defending Public Safety Employees' Retirement Act (P.L. 114-26) broadens the definition of “qualified public safety employee” for employees exempt from the 10 percent additional tax on early distributions from retirement plans, and adds federal defined contribution plans to this exemption Trade Preferences Extension Act (P.L. 114-27, Title VIII, Section 806) increases penalties for not filing information returns and payee statements on time, including Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.) June 23 Worksheets and explanations for the second Cycle E plan language New VCP Submission Kit for correcting contribution failures for money purchase pension and target benefit plans Determination letter review process for the second Cycle E and beyond Penalty relief program for Form 5500-EZ late filers Fix-it Guides updated 403(b) Plan Fix-it Guide SEP Fix-it Guide SIMPLE IRA Plan Fix-it Guide Suspension of benefits under the Multiemployer Pension Reform Act of 2014 Temporary Regulations Proposed Regulations Application procedures and model notice (Rev. Proc. 2015-34PDF) June 10 Sample plan language (listings of required modifications) for ESOPs, cash balance and 403(b) plans Guidance for permanent program for late 5500-EZPDF filers IRS Nationwide Tax Forums begin in July Changes to Forms 5500 for 2014 IRS names seven new members to ACT advisory panel Updated Voluntary Correction Program fee chart May 6 Print version of newsletterPDF Changes to EP determination letter application processing – effective date depends on whether you file Form 5300, 5307 or 5310 New revenue procedures update the Correction Program overpayment rules, lower fees and other revisions reduced corrective contributions for 401(k) and 403(b) elective deferral errors Form 5500-EZ late filer penalty relief – remember to file by June 2 Updated FAQs: multiple employer plans Notice 2015-7 – the IRS and Treasury Department anticipate issuing proposed regulations under Internal Revenue Code Section 414(d) to define the term “governmental plan.” This notice describes the guidance under consideration, which would provide that employees of a public charter school may participate in a State or local retirement system if certain conditions are satisfied, and requests comments by May 11, 2015. April 1 Print version of newsletterPDF Plan sponsors Keep documentation for hardship distributions and plan loans Retirement plan distributions to foreign persons require withholding Follow up on the plan corrections you agreed to in your VCP compliance statements DOL Corner – news from Department of Labor Plan document help Apply for a determination letter for your individually designed plan Tips to expedite the determination letter process FAQs on reference lists of changes in qualification requirements (new) Updated 403(b) Listing of Required Modifications sample plan provisions help plan sponsors draft their plans IRAs Tax Time Guide: still time to contribute to an IRA for 2014 IRA limits for contributions and deductions April 1 deadline to take required retirement plan distributions for many retirees who turned 70 ½ in 2014 Updated SEP Plan Fix-it Guide Publication 3998PDF, Choosing a Retirement Solution for Your Small Business Publication 4284PDF, SIMPLE IRA Plan Checksheet Publication 4285PDF, SEP Plan Checksheet Publication 4286PDF, SARSEP Checklist Publication 4334PDF, SIMPLE IRA Plans for Small Businesses Publication 4484PDF, Choose a Retirement Plan for Employees of Tax Exempt and Government Entities Publication 4587PDF, Payroll Deduction IRAs Publication 4806PDF, Profit Sharing Plans for Small Business March 25 Print version of newsletterPDF Defined benefit plans Expanded annual actuarial certifications for multiemployer plans due March 31 for calendar year plansAutomatic approval for change in method due to takeovers of single-employer defined benefit plans February 27 Print version of newsletterPDF Correction options for 457(b) plans – EP Voluntary Compliance is not available for form errors March webinars: Highlights of the Second Cycle E Determination Letter Application Process – March 5, 2015, at 2 p.m. Eastern Retirement Plan Loans to Participants – March 26, 2015, at 2 p.m. Eastern my Social Security account – with it, your clients can get a replacement SSA-1099 or SSA-1042S online Updated: Publication 4484PDF, Choose a Retirement Plan for Employees of Tax Exempt and Government Entities Form 8955-SSAPDF, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefit (Instructions PDF) February 2 Print version of newsletterPDF Reference lists of changes in plan qualification requirements - tools to help you keep your plan document up-to-date Penalties may be waived for delinquent Forms 5500EZ and some Form 5500-series Forms and Pubs Form 8606PDF - use to report: nondeductible contributions you made to traditional IRAs; nondeductible contributions to traditional IRAs; IRA distributions; and IRA conversions New: Form 1098-QPDF, Qualifying Longevity Annuity Contract Information Publication 590-A (2014)PDF, Contributions to Individual Retirement Arrangements (IRAs) Publication 590-B (2014PDF, Distributions from Individual Retirement Arrangements (IRAs) Updated: Form 1099-RPDF, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. (Instructions PDF) Recent internal directives Realignment of Technical Work between the Tax Exempt and Government Entities Division (TE/GE) and Office of Associate Chief Counsel (Tax Exempt and Government Entities) (Jan. 7, 2015) Limit your search results on IRS.gov to the Retirement Plans webpages: click on Advanced, enter your search terms in the “Find results” fields, and type “/retirement-plans” in the “Domain” field
