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Northwest OH Legal Blog

Tuesday, March 7, 2017

Internal Revenue Service Issues 2016 Required Amendments List for Tax-Qualified Retirement Plans

On June 29, 2016, the Internal Revenue Service (“IRS”) released supplemental guidance detailing anticipated changes to its determination letter program for individually designed retirement plans (“IDPs”) that are tax-qualified under the Internal Revenue Code (“Code”).  The changes are generally effective January 1, 2017.  Although IRS Revenue Procedure 2016-37 covers many changes to the IRS’s determination letter program, most of the changes relate to when an IDP— 

  • must be amended for legally required changes, or
  • may request a determination letter.

Background.  Pursuant to IRS Revenue Procedure 2016-37, an IDP’s Code Section 401(b) remedial amendment period for required amendments is based on a so-called “Required Amendment List” (“RA List”) that is published by the IRS, unless legislation or other guidance provides otherwise.  The RA List is the annual list of all the legal changes for which an IDP must be amended to retain its tax-qualified plan status under the Code.  IDPs are no longer required to make interim amendments.

On December 13, 2016, the IRS, in accordance with its prior guidance in IRS Revenue Procedure 2016-37, issued IRS Notice 2016-80.  The notice includes the RA List for 2016 (“2016 RA List”).  Below is a summary of the major points covered in IRS Notice 2016-80.

Final Day of Remedial Amendment Period for RA List Changes.  The notice restates the rule set forth in IRS Revenue Procedure 2016-37 that in the case of an IDP, the remedial amendment period for a disqualifying provision arising as a result of a change in tax-qualification requirements under Code Section 401(a) generally is extended to the end of the second calendar year that begins after the issuance of the RA List in which the change in qualification requirements appears.  Accordingly, December 31, 2018 is the last day of the remedial amendment period—and is the deadline for adopting the amendment—with respect to a disqualifying provision arising as a result of a change in tax-qualification requirements that appears on the 2016 RA List.

Content and Organization of 2016 RA List.  In general, according to the notice, an RA List includes statutory and administrative changes in qualification requirements (for tax-qualified retirement plans) that are first effective during the plan year in which the list is published.  However, an RA List does not include guidance issued or legislation enacted after the list has been prepared, and also does not include:

  • statutory changes in tax-qualification requirements for which the United States Treasury Department (“Treasury”) and the IRS expect to issue guidance (which would be included on an RA List issued in a future year);
  • changes in tax-qualification requirements that permit (but do not require) optional plan provisions; or
  • changes in the tax laws affecting qualified plans that do not change the tax-qualification requirements under Code Section 401(a).

The 2016 RA List is divided into two parts.  Part A covers changes in tax-qualification requirements that generally would require an amendment to most plans or to most plans of the type affected by the change.  Part B includes changes in tax-qualification requirements that Treasury and the IRS anticipate will not require amendments in most plans, but might require an amendment because of an unusual plan provision in a particular plan.  Notably, Part A of the 2016 RA List does not include any changes or required amendments, and Part B includes only one change, a minor change under Code Section 436 regarding restrictions on accelerated distributions from underfunded single-employer plans that are— 

  • collectively bargained, and
  • involved in an employer bankruptcy.

Bottom Line.  Except for the one very limited change included in Part B, the 2016 RA List in IRS Notice 2016-80 does not include any changes or amendments that plan sponsors need to adopt in order for an IDP to remain tax-qualified under Code Section 401(a).


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