According to Notice 2009-82, the amendments provide that participants and beneficiaries can choose to receive or not to receive the 2009 RMD and provide for the rollover of certain 2009 RMDs.
The tax agency document said sponsors may need to tailor the sample amendment to their plan’s particular terms and administration procedures and must adopt the amendment no later than the last day of the first plan year beginning on or after January 1, 2011 (January 1, 2012, for governmental plans).
The RMD waiver was contained in the Worker, Retiree, and Employer Recovery Act (WRERA) of 2008 (see “Bush Signs RMD, Pension Relief Bill“).
Also in the notice, the agency acknowledges that because of the timing of the WRERA enactment, many sponsors have not been able to put the required plan amendments into place.
So, the agency said, plans will not be treated as failing to satisfy the requirement that it be operated in accordance with its terms merely because, during the period beginning on January 1, 2009, and ending on November 30, 2009:
- distributions that equal the 2009 RMDs or that are one or more payments in a series of substantially equal distributions (that include the 2009 RMDs) made at least annually and expected to last for the life (or life expectancy) of the participant, the joint lives (or joint life expectancy) of the participant and the participant’s designated beneficiary, or for a period of at least 10 years were or were not paid.
- participants and beneficiaries were not given the option of receiving or not receiving distributions that include 2009 RMDs, or;
- a direct rollover option was or was not offered for 2009 RMDs or for other amounts that can be rolled over pursuant to the rollover relief provided in the following paragraph.
The IRS guidance also indicated that plan investors who have already received their 2009 RMD can still roll over the funds until the later of November 30, 2009 or 60 days after the distribution. The IRS indicated IRA owners could also take advantage of the 60-day rollover period extension.
The IRS document also presents a series of questions and answers about the RMD regulations. The latest guidance is available here.