Getting Your 403(b) Plan Into Shape - What To Do Now
You are undoubtedly well aware that proposed regulations have been issued under Section 403(b) of the Internal Revenue Code, and that these regulations may require significant changes in your school's approach to administration of your 403(b) programs. You may not be aware, however, that the IRS recently expanded a pilot 403(b) compliance check of school 403(b) programs. The compliance check is intended to uncover eligibility errors in school 403(b) plans, which the IRS believes to be a pervasive problem.
While it may seem difficult to know where to start in preparing for IRS actions on school 403(b) programs, there is no cause for either confusion or panic. The IRS has most recently indicated that we can expect to see final 403(b) regulations in the first half of this year, but the final 403(b) regulations will be effective no earlier than January 1, 2008 (and it is likely that the effective date will be later than this). In the meantime, there are steps that schools can and should begin to take now, particularly in light of the IRS' targeted 403(b) compliance efforts. For a handy checklist to help your school determine what to do (and what not
to do) now, go here. For more information regarding compliance with the 403(b) rules and the IRS compliance check and exam requirements, please contact Jim Kemper,
Mary Beth Braitman or Tara Schulstad Sciscoe.
