The agency said the regulations provide guidance with respect to certain issues that are not addressed in the 2010 final regulations and make certain other changes to the final regulations.
The 2010 final regulations provide that certain rules otherwise applicable to benefits under a defined benefit plan are not violated in a cash balance or pension equity plan design. The new final regulations expand the hybrid plan formulas to which this relief applies.
The final regulations also include special rules with respect to variable interest crediting rates and special age discrimination rules, including rules with respect to the market rate of return limitation.
The final rules are effective September 19, 2014, and generally apply to plan years beginning on or after January 1, 2016.
In conjunction with the final rules, the IRS issued a proposed rule that would permit a hybrid plan that does not comply with the requirement that the plan not provide for interest credits (or equivalent amounts) at an effective rate that is greater than a market rate of return to comply with that requirement by changing to an interest crediting rate that is permitted under the final hybrid plan regulations, without violating the anti-cutback rules.
The final regulations for hybrid retirement plans are here.