IRS Issues 2019 Required Amendments List

This publication applies to governmental plans.

The Internal Revenue Service ("IRS") issued the 2019 Required Amendments List under IRS Notice 2019-64 on December 4, 2019. The IRS publishes an annual Required Amendments List, which generally applies to changes in requirements that become effective on or after January 1 of that year. The Required Amendments List applies to both individually designed plans qualified under Internal Revenue Code ("Code") § 401(a) and individually designed plans that satisfy the requirements of Code § 403(b). The Required Amendments List establishes the date by which plan amendments must be made for changes in requirements contained on the list. In general, the Required Amendment List will not include a change to the requirements until guidance regarding such change (including any model amendments) has been provided in regulations or in other guidance published by the IRS. However, the IRS may include items on a Required Amendments List in other situations, such as when a statutory change is enacted and it is anticipated that no guidance will be issued. 

The 2019 Required Amendments List addresses the final regulations relating to hardship distributions. The proposed regulations regarding hardship withdrawals were included on the 2016-2019 Operational Compliance List, last updated by the IRS on March 26, 2019, as an item effective in 2019. These amendments are applicable to certain 401(k) and 403(b) plans and are applicable to governmental 401(k) plans. For more information regarding the final regulations on hardship distributions, please refer to our October 1, 2019 e-alert entitled "Final Regulations on Hardship Distributions Make Few Changes to Proposed Regulations." Additionally, on November 15, 2019, we published an e-alert (for governmental plans) entitled "Do the Final Regulations on Hardship Distributions Affect 457(b) Plan "Unforeseeable Emergencies"? Not directly," to discuss the effect of the final regulations on 457(b) plans. Given that the final regulations are included in the 2019 Required Amendments List, the deadline to adopt the amendments required under the final regulations will be the later of: (i) December 31, 2021 or (ii) 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins on or after December 4, 2019. 

Also, on December 12, 2019, the IRS published Revenue Procedure 2020-9, which clarifies that the IRS will treat as integral to the required amendments in the final regulations on hardship distributions of elective deferrals, all plan amendments relating to a plan's hardship distribution provisions and which are effective no later than January 1, 2020. Required amendments are: (1) amendments to remove plan provisions suspending an employee's contributions after a hardship distribution of elective deferrals, and (2) if not already provided for in the plan, amendments requiring an employee's representation relating to his or her need for a hardship distribution. These required amendments must be effective for hardship distributions made on or after January 1, 2020 (such amendment may be implemented as early as the first day of the plan year beginning after December 31, 2018). In addition, for pre-approved plans, Revenue Procedure 2020-9 extends to December 31, 2021, the deadline for adopting an interim amendment relating to the required amendments (described above) in the final regulations on hardship distributions of elective deferrals, and all amendments treated as integral to those amendments. 

On August 10, 2017, we published an e-alert entitled "Introducing Ice Miller's Qualified Plan Comply Now Program," which addressed how Ice Miller can assist you with keeping your plan documents in compliance with the IRS ongoing changes in qualification requirements in light of the IRS' near termination of its determination letter program.

To discuss the impact of the 2019 Required Amendments List on your plan documents, or for more information about Comply Now, please contact Audra Ferguson-Allen, Rob Gauss, Lisa Harrison, Lindsay Knowles, Tara Sciscoe, or Chris Sears, or the Ice Miller LLP Employee Benefits attorney with whom you most closely work. 

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader should consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.