The IRS has set forth a system of recurring remedial amendment periods for correcting form defects in individually designed and 403(b) pre-approved plans first occurring after the initial remedial amendment period ends on March 31, 2020, and provides a limited extension of the initial remedial amendment period for certain form defects. The guidance is contained in Revenue Procedure (Rev. Proc.) 2019-39.
Rev. Proc. 2019-39 establishes a system of 403(b) pre-approved plan cycles under which a 403(b) pre-approved plan sponsor may submit a proposed 403(b) pre-approved plan for IRS review and approval. Once approved, the 403(b) pre-approved plan may be made available for adoption by eligible employers. This revenue procedure also provides deadlines for the adoption of plan amendments for 403(b) individually designed plans and 403(b) pre-approved plans.
Rev. Proc. 2019-39 also announces that the Department of the Treasury and the IRS intend to issue additional guidance — before the date that Section 403(b) pre-approved plans may next be submitted for review — relating to the system of recurring remedial amendment periods and the system of recurring 403(b) pre-approved plan cycles.
Section 21.02 of Rev. Proc. 2013-22, 2013-18 I.R.B. 985, as modified by Rev. Proc. 2014-28, 2014-16 I.R.B. 944, and Rev. Proc. 2015-22, 2015-22 I.R.B. 754, and as clarified by Rev. Proc. 2017-18, 2017-5 I.R.B. 743, establishes a remedial amendment period that permits an eligible employer to retroactively correct form defects in its written 403(b) plan by timely adopting a 403(b) pre-approved Plan or by otherwise timely amending its 403(b) individually designed plan. Rev. Proc. 2017-18 provides that March 31, 2020, is the last day of this initial remedial amendment period. In addition, section 16.01 of Rev. Proc. 2013-22 provides that the IRS expects future guidance to require the restatement of 403(b) pre-approved plans every six years.
Rev. Proc. 2019-39 is effective Sept.30, 2019.
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