In Announcement 2009-89, the agency said that within the
next few months, it expects to publish a revenue procedure for obtaining an
opinion letter that the form of a prototype or other "pre-approved Plan" meets the requirements of § 403(b) of the
Internal Revenue Code (see 403(b) Prototype to Allow for Vesting Schedules), and subsequently, it intends
to publish a revenue procedure for obtaining an individual determination letter
for a § 403(b) plan.
Announcement 2009-89 provides for a remedial amendment
period and reliance for employers that either adopt a pre-approved plan with a
favorable opinion letter or apply for an individual determination letter when
In other words, for plans adopted on or before the December
31, 2009, deadline, if the employer sponsoring the plan either adopts a
pre-approved plan that has received a favorable opinion letter from the IRS or
applies for an individual determination letter when available, the employer
will have a remedial amendment period in which to amend the plan to correct any
form defects retroactive to January 1, 2010. In addition, the employer will
have reliance, beginning January 1, 2010, that the form of its written plan
satisfies the requirements of § 403(b) and the regulations, provided that,
during the remedial amendment period, the pre-approved plan is adopted retroactive
to January 1, 2010, or the plan is amended to correct any defects in the form
of the plan retroactive to January 1, 2010.
The announcement also said an employer that first
establishes a § 403(b) plan after December 31, 2009, by adopting a written plan
intended to satisfy the requirements of § 403(b) and the regulations will also
have reliance beginning on the effective date of the plan, provided the
employer either adopts a pre-approved plan with a favorable opinion letter or
applies for an individual determination letter and corrects any defects in the
form of the plan retroactive to the plan’s effective date.
According to the announcement, the upcoming revenue
procedures will include this remedial amendment provision and will address the
time-frames for adopting a pre-approved plan or applying for a determination
letter and other details regarding the remedial amendment period.
of the additional guidance, the IRS said, employers should not request ruling
or determination letters on the form of their § 403(b) plans at this time.