Should My Cycle 2 Preapproved 403(b) Restatement Also Include SECURE 2.0 Amendments?

Q: I read in a recent Ask the Experts column that I should expect my Cycle 2 preapproved plan document restatement for my 403(b) plan shortly. Well, I just received it but strangely, it also includes an amendment for the SECURE 2.0 Act and other tax law changes. Does that make sense?

Kimberly Boberg, Kelly Geloneck, Emily Gerard and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:

A: It does indeed! The deadline to adopt both (1) a Cycle 2 403(b) preapproved plan and (2) any applicable amendments to a non-governmental/non-collectively bargained 403(b) plan for SECURE 2.0 is December 31, 2026. Unfortunately, SECURE 2.0 amendments could not be included in your preapproved plan document for Cycle 2, as the IRS review of your 403(b) preapproved plan was limited to items included in Notice 2022-8 (Cumulative List), which does not include the SECURE 2.0 changes. That is why you received a separate year-end amendment to address those amendments.

While it may seem odd that your brand-new plan restatement already contains an amendment, the limits on the IRS’ review and the overlapping deadlines created that possibility.

NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.

Do YOU have a question for the Experts? If so, we would love to hear from you! Simply forward your question to Amy.Resnick@issmarketintelligence.com with Subject: Ask the Experts, and the Experts will do their best to answer your question in a future column.