After having decided to offer a plan, the first step is to adopt a written plan.
All 403(b) plans, except certain church plans that do not contain any retirement income accounts, must have a written program that must contain mandatory provisions and may contain other optional provisions.
All employers must have a compliant plan in place by March 31, 2020. This is called a restatement and must be adopted by such date.
Commentary: If applicable, make sure that your school had a valid plan document adopted no later than Dec. 31, 2009. The restatement will then be effective from Jan. 1, 2010 through the date that the new plan is executed. This new plan will cover any amendments/changes in operations that occurred from Jan. 1, 2010 through the date of the restatement. This is critical since it is the only way that an employer will have reliance from Jan. 1, 2009 through the present day.
Editor’s Note: This is an occasional feature in the NTSA Advisor. This tip is taken from the 403(b) Plan Sponsor Guide, which is being made available to school districts nationally to assist them in understanding how to improve 403(b) plan participation and savings rates to help employees achieve a comfortable and timely retirement.
The 403(b) Plan Sponsor Guide is part of the content contained in the NTSA Certified Retirement Education Specialist (CRES) materials. The NTSA Certified Retirement Education Specialist (CRES) program and designation has been developed in order to equip advisors to be qualified and available to teach the NTSA educational program, which is designed to provide teachers with the basics of planning for retirement and improve their retirement readiness. More information about CRES is available here.
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