July 25, 2012 (PLANSPONSOR.com) – Two industry groups have expressed concern that the Internal Revenue Service’s new proposed definition of a governmental plan would adversely impact charter school retirement programs.
Specifically, the American Society of Pension Professionals and Actuaries (ASPPA) and National Tax Sheltered Accounts Association (NTSAA) said the IRS’ proposed facts and circumstances test to determine agency would adversely impact this sector of the 403(b) marketplace. In a comment letter, ASPPA and NTSAA recommend that the Treasury Department and IRS establish an exemption specific to charter schools that are created and maintained pursuant to state statutes and create an express category in the description of agency to include charter schools.
The letter said many of the factors in the proposed rules would automatically disqualify plans maintained by charter schools. The groups outlined the impact this could have on state retirement plans, participants and charter schools. The comment letter is here.