IRS Guidance

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The IRS recently issued Notice 2023-43 providing new interim guidance for self-correction of plan errors. This guidance applies to corrections made prior to the anticipated issuance of revisions to the Employee Plans Compliance Resolution System (“EPCRS”). Under this guidance, provided certain conditions are satisfied, most Eligible Inadvertent Failures (defined below) may be self-corrected, though there are specific types of failures that may not be self-corrected at this time (discussed below).

On October 21st, the IRS announced changes to its qualified plan determination letter program. Most notably, the program has been expanded to include section 403(b) tax-sheltered annuity plans (“403(b) plans”). Although 403(b) plans are similar to tax-qualified defined contribution plans (“401(a) plans”), they are subject to unique rules, and, until now, the IRS…

On October 21st, the IRS released a number of additional inflation adjustments for 2023, including to certain limits for qualified retirement plans.  Perhaps most notably, the annual limit for pre-tax and Roth contributions by employees to 401(k) plans has jumped from $20,500 to $22,500, and the annual limit for “catch-up” contributions to such…

On October 18th, the IRS announced a slew of inflation adjustments for 2023, including to the annual contribution and carryover limits for healthcare flexible spending accounts and the monthly limit for qualified transportation fringe benefits.  The IRS did not increase the annual contribution limit for dependent care flexible spending accounts because that limit is not…

On September 26, 2022, the IRS released IRS Notice 2022-45, which corrected a potential oversight in IRS Notice 2022-33, discussed in detail here.  Notice 2022-33 had extended the deadline to adopt certain retirement and savings plan amendments required by the Setting Every Community Up for Retirement Enhancement Act of 2019 (“SECURE Act…

Perhaps channeling the old adage of “if it ain’t broke, don’t fix it,” the IRS recently released Notice 2022-27 extending through December 31, 2022 its temporary relief from the requirement that spousal consent for plan distributions or loans be witnessed in person.

As discussed in greater detail in our earlier posts (here and here…

Employers that are tax-exempt or have tax-exempt affiliates (for example, a foundation) should pay close attention to a 21% excise tax under Section 4960 of the Internal Revenue Code on certain executive compensation.  Final Regulations under Section 4960 are described here.  The discussion includes traps for the unwary.  Please reach out to your Proskauer…

In Notice 2020-50, the IRS expanded eligibility for CARES Act distributions and loans, and provided additional guidance.  To recap (as described here), the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) added three types of distribution and loan flexibility under eligible retirement plans for certain “qualified individuals”: (1) “coronavirus-related distributions” (“CRDs”) up…