401(k) Plans

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The Internal Revenue Service (IRS) announced the 2026 cost-of-living adjustments to the dollar limitations for qualified retirement plans and other benefits, and the Social Security Administration announced its own cost-of-living adjustments for 2026. Most of the dollar limits, including the elective deferral contribution limit for 401(k), 403(b), and 457(b) plans; the annual compensation limit under 401(a)(17); and the maximum annual contribution limit under Code Section 415(c) will increase from 2025 limits. The dollar limit for catch-up contributions for participants who attain age 60,61,62, or 63 in 2026 will remain the same.

Last May, we provided a client alert about a recent federal district court case (Spence v. American Airlines, No. 4:23-cv-00552-O, 2025 WL 225127, at *2 (N.D. Tex. Jan. 10, 2025)), in which a plan sponsor and certain plan fiduciaries were found to have breached their ERISA fiduciary duty of loyalty based primarily on conduct related to proxy voting of securities held in certain of the 401(k) plans’ investment funds. At that time, the court left open the question of whether the breach resulted in any damages to the participants.

In our recent client alert, “Texas Federal Court Allows an ERISA Fiduciary Challenge Against Alleged “ESG Investing” Without Any ESG Funds,” we reported that a Texas district court recently upheld Biden-administration Department of Labor (DOL) rules permitting environmental, social, and governance (ESG) considerations as “tie breakers” in selecting 401(k) plan investments. The district court, following instructions from the Fifth Circuit Court of Appeals, applied a Loper Bright “post-Chevron” analysis to hold that the Biden-era rules were validly issued.

The Internal Revenue Service announced the 2025 cost-of-living adjustments to the dollar limitations for qualified retirement plans and other benefits, and the Social Security Administration announced its own cost-of-living adjustments for 2025. Most of the dollar limits, including the elective deferral contribution limit for 401(k), 403(b) and 457(b) plans, the…

In a blog post dated May 10, 2024, we discussed the Form 5330, an excise tax return used by certain employers and individuals to pay penalty taxes with respect to employee benefit plans, must be filed electronically for taxable years ending on or after December 31, 2023 if the filer is required to file at least 10 returns of any type. As described further in that blog post, this electronic filing requirement had the potential to create issues for sponsors of qualified retirement plans because there was not an Authorized e-file Provider (“AEP”) with the capability of electronically filing Forms 5330. Without relief from the Internal Revenue Service (“IRS”), employers would not have the option of filing the Forms 5330 by paper even with the lack of AEPs.…

In late December 2023, approximately one year after Congress enacted the Setting Every Community Up for Retirement Enhancement Act of 2022 (“SECURE 2.0”), the Internal Revenue Service (the “IRS”) released Notice 2024-2 (the “Notice”) providing much needed guidance, in the form of questions and answers, on 12 of the 90 new provisions added by SECURE 2.0.…

The Internal Revenue Service announced the 2024 cost-of-living adjustments to the dollar ‎limitations for qualified retirement plans and other benefits, and the Social Security ‎Administration announced its own cost-of-living adjustments for 2024. Most of the dollar ‎limits, including the elective deferral contribution limit for 401(k), 403(b) and 457(b) plans, the ‎annual compensation limit under 401(a)(17) and the maximum annual contribution limit under ‎Code Section 415(c) will increase from 2023 limits. The dollar limit for catch-up contributions ‎‎(if age 50 or older) remains the same as the 2023 limit.‎…

Long-awaited guidance was received from the IRS on Friday related to the SECURE 2.0 ‎requirement that catch-up contributions for high-income participants in 401(k), 403(b), and ‎governmental 457(b) plans be made as Roth contributions. Notice 2023-62 provides for a 2-year ‎administrative transition period that will be welcome relief to retirement plan sponsors and ‎record keepers alike.…