IRS Extends Deadline for Amending Qualified Retirement Plans to Comply with PPA

The Internal Revenue Service (IRS) has granted a one-year extension for amending certain defined benefit and contribution plans that are subject to minimum funding requirements to comply with the additional funding mandates provided by the Pension Protection Act of 2006 (PPA 06) and modified by the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA). The deadline will be extended to the last day of the first plan year beginning on or after January 1, 2010. According to the IRS Notice 2009-97 (pdf), to be published in the December 28 Internal Revenue Bulletin, this extension applies to the deadline for amending the following:

  • single-employer defined benefit plans to meet the requirements of Internal Revenue Code (IRC) sections 401(a)(29) and 436, relating to funding-based limits on benefits and benefit accruals under single-employer plans;
  • cash balance and other applicable defined benefit plans to meet the requirements of sections 411(a)(13) and 411(b)(5), relating to vesting and other special rules applicable to these plans; and
  • certain defined contribution plans to meet the requirements of section 401(a)(35), relating to diversification requirements for specified defined contribution plans.

In addition, Notice 2009-97 provides limited relief from the anti-cutback requirements of IRC section 411(d)(6) for amendments that are adopted by the extended deadline. This notice further provides that limited section 411(d)(6) relief is expected to be granted for amendments that are adopted by the extended deadline for amending a plan to meet the requirements of section 411(b)(5) once final regulations under sections 411(a)(13) and 411(b)(5) are issued.
 

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Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.