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
New IRS Guidance: Emergency Personal Expense and Domestic Abuse Victim Distributions Under SECURE 2.0
On June 20, 2024, the Internal Revenue Service (“IRS”) released Notice 2024-55 (the “Notice”) offering guidance on two (2) new types of distributions exempt from the 10% early withdrawal penalty: emergency personal expense distributions and domestic abuse victim distributions.
IRS Issues Guidance on Secure 2.0 – What Plan Sponsors Need to Know
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.
IRS Announces 2024 Retirement Plan Limits: Modest Increases
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.
SECURE 2.0: Two-Year Transition Relief Announced for Roth Catch-Up Contributions
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.
IRS Expands Determination Letter Program to Include Individually-Designed 403(b) Plans
In Revenue Procedure 2022-40, the IRS recently expanded the determination letter program to allow applications by individually-designed 403(b) plans. This expansion will allow 403(b) plan sponsors to request a determination letter that expresses the IRS’ opinion that the plan’s terms (as stated in the plan document) meet the requirements
Legislation Proposed to Allow Employers to Make Matching Contributions on Student Loan Repayments
Two bills have been introduced in the Senate that would allow employers to make matching contributions under 401(k), 403(b), governmental 457(b) and SIMPLE plans as if the participant’s student loan payments were salary reduction contributions. On May 13, Senator Ron Wyden (R-OR) reintroduced the Retirement Parity for Student Loans Act
Time to Restate Your 403B Plan
The Internal Revenue Service set March 31, 2020 as the last date of the remedial amendment period for tax-exempt organizations and public school systems to self-correct plan document defects in their Section 403(b) plans. The “remedial amendment period”, or “RAP” is a period during which a 403(b) plan can be
Locke Lord QuickStudy: IRS Announces 2020 Retirement Plan Limitations – Most Limits are Increased
The Internal Revenue Service announced the 2020 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 2020. The elective deferral contribution limit for 401(k), 403(b) and 457(b) plans will increase to