The IRS has published Notice 2021-64, which sets forth the 2021 Required Amendments List (RA List).
It applies to both individually designed plans qualified under Internal Revenue Code (IRC) Section 401(a) and individually designed plans that satisfy the requirements of Section 403(b). In general, an RA List includes statutory and administrative changes in requirements that are first effective during the plan year in which the list is published. The RA List might include changes that would require an amendment as well as changes that may require an amendment.
Under Section 5.05(3) of Revenue Procedure (Rev. Pro.) 2016-37, the remedial amendment period for a plan that is not a governmental plan within the meaning of IRC Section 414(d) is extended to the end of the second calendar year that begins after the issuance of the RA List on which the change in qualification requirements appears. That is December 31, 2023, for a change that appears on the 2021 RA List. Section 5.06(3) provides a special rule for governmental plans that may further extend the remedial amendment period in some cases.
The IRS notes that Rev. Pro. 2019-39 provided a recurring remedial amendment period with respect to a form defect in a 403(b) individually designed plan. Generally, the remedial amendment period arising as a result of a change in 403(b) requirements ends on the last day of the second calendar year that begins after the issuance of the RA List on which the change in 403(b) requirements appears. December 31, 2023, generally is the last day of the remedial amendment period with respect to a disqualifying provision arising as a result of a change in qualification requirements that appears on the 2021 RA List, and a form defect arising as a result of a change in 403(b) requirements that appears on the 2021 RA List.
On the 2021 RA List, changes in requirements that would necessitate an amendment to most plans or to most plans of the type affected by the change relate to the special financial assistance (SFA) program for financially troubled multiemployer plans that was established with the passage of the American Rescue Plan Act (ARPA) of 2021.
Among other things, IRS Notice 2021-38 provides that if an eligible multiemployer plan receiving special financial assistance was previously amended to suspend benefits, or had suspended benefits operationally without adopting a plan amendment, the plan must be amended to reinstate those suspended benefits, effective as of the month in which the special financial assistance is paid to the plan, for individuals who are participants or beneficiaries as of that month.
Notice 2021-38 also provides that an eligible multiemployer plan that receives special financial assistance must be amended to provide makeup payments to individuals who are participants or beneficiaries on, and who have commenced benefits by, the date the special financial assistance is paid to the plan. The makeup payments to a participant or a beneficiary must be paid, as determined by the plan sponsor, either as a lump sum within three months of the date the special financial assistance is paid to the plan or in equal monthly installments over a period of five years, commencing within three months of the date the special financial assistance is paid. The plan amendment providing for the makeup payments must also specify which distribution form will apply for the makeup payments to a participant or beneficiary.
There are no changes on the 2021 RA List that may require an amendment.
« Updated myStockOptions Year-End Planning Site Updated