IRS Notice 2022-45 (Sept. 26, 2022)
Available at https://www.irs.gov/pub/irs-drop/n-22-45.pdf
The IRS has extended the deadline for amending 401(k) plans (and other eligible retirement plans, as well as individual retirement arrangements (IRAs)) to reflect relief relating to plan loans and coronavirus-related distributions under the CARES Act (see our Checkpoint article) and “qualified disaster distributions” under the disaster-relief provisions of the Consolidated Appropriations Act, 2021 (CAA; see our Checkpoint article). In general, distributions that qualify as either coronavirus-related distributions or qualified disaster distributions under the CAA are exempt from certain requirements otherwise applicable to hardship distributions. The relief granted for the two types of distributions is similar but not identical; for example, anti-cutback relief is available only for coronavirus-related distributions. For details, the notice refers readers to prior CARES Act guidance (see our Checkpoint article) and Form 8915-F and its instructions (see our Checkpoint article).
For qualified plans that are not governmental plans, the original amendment deadline set forth in both the CARES Act and the CAA is the last day of the first plan year beginning in 2022. This IRS notice extends this deadline to December 31, 2025. (The same extended deadline applies for certain other plans and for IRAs; different extended deadlines apply for governmental plans.) In addition, a timely adopted amendment relating to coronavirus-related distributions will not cause a plan to fail to satisfy the anti-cutback rules under the Code or ERISA.
EBIA Comment: The IRS previously extended the deadline for adopting amendments reflecting the waiver of required minimum distributions (RMDs) for 2020 under the CARES Act (see our Checkpoint article). According to the IRS, it is anticipated that those amendments and the amendments addressed in this notice may be adopted on a single date. Plan sponsors will no doubt appreciate being able to take a single action adopting the various amendments. Note that, as with the RMD amendment extension, the extended deadline is a fixed date not related to the plan year. For more information, see EBIA’s 401(k) Plans manual at Sections XXVII.E (“Amendment Timing: Overview”), XII.G.3 (“Coronavirus-Related Distributions”), XV.H (“Special Hardship Rules for Disaster Relief”), and XVI.N (“Special Rules for Disaster Relief”).
Contributing Editors: EBIA Staff.
