IRS Extends More Retirement Plan Amendment Deadlines

October 2022

The IRS announced on September 26, 2022, that it would extend the deadline for amending retirement plans or individual retirement arrangements (IRAs) to reflect coronavirus-related distributions (CRDs) and certain qualified disaster distributions. 

Notice 2022-45 extends the deadline by three years, generally to December 31, 2025.The deadline extension also applies to retirement plans that allowed expanded participant plan loans during 2020.  

CRDs were permitted during 2020 under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. CRDs are aggregate distributions up to $100,000 from IRAs and qualified defined contribution retirement plans made between January 1 and December 30, 2020 (not December 31) due to certain COVID-19-related reasons. Individuals could include the CRDs in income ratably over three years (2020, 2021 and 2022). CRDs can be repaid in full or in part to a retirement plan or IRA within three years after the date the distribution was received (in other words, repayments are allowed through the 2023 anniversary date of the distribution). If the CRD is timely repaid after payment of income taxes, the individual can file an amended federal income tax return to claim a refund of the tax attributable to the amount of the CRD being repaid. 

The plan amendment deadline relief applies only to qualified disaster distributions that were authorized under the Consolidated Appropriations Act, 2021 (CAA). Specifically, the plan amendment deadline relief applies to distributions from an eligible retirement plan that were made on or after the date the disaster began (but no earlier than December 28, 2019) and before June 25, 2021. See IRS Form 8915-F, Qualified Disaster Retirement Plan Distributions and Repayments and instructions for further information.



The new relief aligns with other plan amendment extensions announced on August 6 in Notice 2022-33, that were limited to:
  • All the changes in the law related to retirement plans and IRAs made by the SECURE Act; 
  • The change lowering the age for in-service withdrawals from defined benefit plans from age 62 to 59½ made by the Miners Act; and
  • The change that temporarily suspended required minimum distributions (RMDs) for 2020 under the CARES Act (but IRAs that suspended 2020 RMDs do not need amendment). 

The combination of September’s Notice 2022-45 with August’s Notice 2022-33 results in a single deadline for all of those changes in the law. 

Regardless of when the plan is amended, it must be operated as if the amendment applied as of the original effective date of the applicable change in the law. Anti-cutback relief is also extended until the applicable plan amendment deadline.

The new December 31, 2025, plan amendment deadline is a fixed date that applies to all non-governmental plans (including non-governmental 403(b) plans) and IRAs, regardless of whether the plan operates on a calendar year or fiscal year basis. Different deadlines apply to governmental plans.
 
Generally, the plan amendment deadline for governmental tax-qualified retirement plans (including 403(b) plans maintained by public schools) is 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins after December 31, 2023. 

But the plan amendment deadline for governmental 457(b) plans (non-qualified deferred compensation plans that are very similar to 401(k) plans) is the later of (1) 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins after December 31, 2023, or (2) if applicable, the first day of the first plan year beginning more than 180 days after the date of notification by the Treasury secretary that the plan was administered in a manner that is inconsistent with the 457(b) requirements.



Governmental plans have later deadlines that depend on the timing of the legislation session.