Left Navigator - Web Content Viewer (JSR 286)
Web Content Viewer

Compliance Newsletter September 2022

Plan Amendment Deadlines Extended

The Internal Revenue Service (IRS) extended the deadline for amending retirement plans and individual retirement arrangements (IRAs) for some of the retirement impacts provided in recent laws passed by Congress.

Impacted Changes

The extended deadlines apply to the following:

  • Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) which includes (but is not limited to):
    • Increase in age for required minimum distributions from age 70 ½ to age 72
    • Coverage for long-term part-time employees in 401(k) plans
    • Lifetime income disclosures
    • Optional withdrawals for birth or adoption expenses
  • Bipartisan American Miners Act of 2019 (Miners Act)
    • Optional in-service distributions at age 59 ½ for defined benefit and governmental 457(b) plans
  • Coronavirus Aid, Relief, and Economic Security Act (CARES Act) passed in 2020
    • Optional waiver for defined contribution required minimum distributions due in 2020

Please note that the optional coronavirus-related distributions and expanded loan provisions passed within the CARES Act do not currently have an extended deadline.

New Deadline

Non-governmental qualified retirement plans or section 403(b) retirement plans, including collectively bargained plans, and IRAs have until December 31, 2025 to comply.

Qualified governmental plans as well as governmental section 403(b) retirement plans must be amended 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.

Governmental section 457(b) plans may have a later deadline if notified by the IRS that the plan was administered inconsistent with Code section 457(b).

Disaster Relief for Kentucky and Missouri

In response to severe storms, flooding, mudslides, and landslides in Kentucky and severe storms and flooding in Missouri, the Internal Revenue Service (IRS) has extended various deadlines for impacted businesses and taxpayers. Pension Benefit Guaranty Corporation (PBGC) also offers relief for certain deadlines according to a one-time announcement published in the Federal Register on July 2, 2018.

Impacted Areas

In Kentucky, individuals who reside or have a business in Breathitt, Clay, Cumberland, Floyd, Johnson, Knott, Lee, Leslie, Letcher, Lincoln, Magoffin, Martin, Owsley, Perry, Pike, Powell, Whitley, and Wolfe counties may qualify for deadline and other relief. In Missouri, individuals who reside or have a business in the Independent City of St. Louis as well as the Montgomery, St. Charles, and St. Louis counties may qualify for deadline relief.

Deadline Relief

Certain deadlines beginning on or after July 26, 2022, in Kentucky or July 25, 2022, in Missouri may be extended until November 15, 2022. Below is a partial list of retirement-impact tax filing and payment deadlines that may be included in the November 15th extension:

  • Retirement plan loan repayments under Internal Revenue Code section 72(p)(2)
  • Required minimum distributions under Internal Revenue Code section 401(a)(9)
  • The 10% additional income tax continues to not apply even if the following is missed during the relief period:
    • Substantially equal payments made over the participant’s life or joint lives of the participant and designated beneficiary
    • Deadline for using a distribution from an IRA for a first-time home purchase by the close of the 120th day after the distribution is received
  • Prior tax year contribution deadlines for retirement plans
  • Indirect rollover distribution deadlines
    • 60-day rollovers
    • Rollover of qualified loan offsets
  • Refunds as a result of
    • Excess deferrals
    • ADP/ACP non-discrimination testing
    • Eligible automatic contribution arrangement (EACA) withdrawals
    • Excess IRA contributions
  • Deadline for recontributing qualified reservist distributions
  • Form 5500 and Form 8955-SSA filing
  • Form 5498 for IRAs
  • PBGC premium payments
  • PBGC deadlines that are based on the Form 5500 deadline
  • Single Employer Plan Termination Forms 500 and 501

Additional Resources

For any questions related to IRS deadlines and other disaster-related issues, the IRS has a toll-free number at 1-866-562-5227. For PBGC disaster-related questions, call 1-800-736-2444 ext. 4136.

The subject matter in this communication is educational only and provided with the understanding that Principal® is not rendering legal, accounting, investment or tax advice. You should consult with appropriate counsel, financial professionals or other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.

Insurance products and plan administrative services provided through Principal Life Insurance Company®, a member of the Principal Financial Group®, Des Moines, IA 50392.

Principal Life Insurance Company, Des Moines, Iowa 50392-0001, www.principal.com, Principal®, Principal Financial Group® and the Principal logo design are registered trademarks of Principal Financial Services, Inc., a Principal Financial Group company, in the United States and are trademarks and service marks of Principal Financial Services, Inc., in various countries around the world.

© 2022 Principal Financial Services, Inc.

PQ11297SEP22

Small Banner Web Content Viewer