403(b) Written Plan Deadline
Rev. 10/30/09; E-mail Alert 2009-17

403(b) Adoption, Restatement and Amendment Deadlines
In accordance with IRS Notice 2009-3, the IRS deadline to adopt a 403(b) plan is fast approaching. Specifically, the deadline is December 31, 2009 with an effective date of January 1, 2009. In addition, the plan is to have operated under Code Section 403(b) and the final 403(b) regulations as of January 1, 2009. Although the IRS 403(b) prototype program is still in draft stage, the IRS requires a “best effort” 403(b) written plan to be adopted by December 31, 2009. Those that adopted a “best effort” document in 2008 need not adopt another plan.

PPA Amendment Deadline
The Pension Protection Act of 2006 (PPA) requires that plans operate under PPA provisions as each becomes effective, but does not require that plans be amended until the end of the first plan year beginning on or after January 1, 2009. Ordinarily, required amendments like those for PPA changes could be made up until a plan’s due date for filing its tax return for the 2009 plan year. However, since the provisions were really effective in 2006 and other pre-2009 years, they would have been required earlier without the extension of the deadline to year end 2009.  Thus, the normal rule of end of the plan year or if later, the due date for filing the tax return for the tax year containing the effective date of the amendment does not apply.

HEART, EESA, WRERA Amendments
The amendment for the Heroes Earnings Assistance and Relief Tax Act of 2008 (HEART) is not due until the 2010 plan year, although some plans are incorporating HEART provisions in their PPA amendment. The Emergency Economic Stabilization Act of 2008 (EESA) amendment is also not due until the 2010 plan year, but again some plans are incorporating EESA into the PPA amendment. An amendment for the provision suspending required minimum distributions, part of the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA), is not due until the 2011 plan year.

Note: McKay Hochman has provided an amendment incorporating changes to PPA, HEART, EESA and WRERA, and is recommending it be adopted by December 31, 2009.

Are you in need of a 403(b) written plan? McKay Hochman offers ERISA,
Non-ERISA, and Church 403(b) plan documents. Call us at 973-492-1880 for more information and/or click here for information on our Pay-Per-Plan.

Get the most up-to-date information about 403(b) plans — and the most continuing education credits for your money — with our six-part 403(b) series. Click here for more information and/or to register.