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Type(s) of contributions permitted under the Providers plan: _____a. 786, to change the portion of the year Sedona, Arizona is a high-cost locality under section 5 of Notice 2020-71. Providers and Mass Submitters must submit applications for an Opinion Letter during the one-year submission period (referred to as the On-Cycle Submission Period) that relates to an applicable Cycle. WASHINGTON The Internal Revenue Service today issued guidance for business management, Document Proc. .22 Qualified Church-Controlled Organization or QCCO A Qualified Church-Controlled Organization or QCCO is a church-controlled tax-exempt organization described in 501(c)(3) that is a qualified church-controlled organization within the meaning of 3121(w)(3)(B). The last Bulletin for each month includes a cumulative index for the matters published during the preceding months. Proc. Proc. For more information, see EBIAs Fringe Benefits manual at SectionXXI.G(Travel Expense Reimbursements: Substantiation). See section 8.04 for situations in which an Adopting Employer may obtain a determination letter using Form 5307 (as updated). General guidance issued in 2019 regarding the use of per diems after the Tax Cuts and Jobs Act remains in effect (see our Checkpointarticle). .14 Sections 10 and 11 of Rev. When the IRS sends a notification to the applicable Mass Submitter with respect to the Mass Submitters plan indicating that the IRS has determined that the plan appears to be in full compliance with the applicable 403(b) Requirements, the Mass Submitter must submit a copy of the Mass Submitters plan with the modifications highlighted, as well as a statement indicating the location and effect of each change. .13 Section 5 of Rev. .04 Amendments of Mass Submitter plans If a Mass Submitter amends one of its 403(b) Pre-approved Plans, the Mass Submitter must provide copies of the amendment to Providers that have adopted the plan. The US military pays its members per diem in accordance with the Joint Travel Regulations. IRS updates per diem guidance for business travelers and their employers. Although sample language is designed for use in plans that use an adoption agreement format, in order to expedite processing, Providers are encouraged to refer to the sample language as a guide in drafting Single Document Plans. Beginning October 1, 2021, the high-low per diem rate that can be used for lodging, meals, and incidental expenses increases to $296 (from $292) for travel to high-cost locations This section 16 does not impose a requirement on a Provider to monitor compliance of an Adopting Employers plan with the 403(b) Requirements, but it provides that the Provider has a duty to inform the Adopting Employer if the Provider has knowledge that the Adopting Employers plan may no longer satisfy those requirements. 2010-48, 2010-50 I.R.B. 87-50, 1987-2 C.B. (4) the absence from a plan of a provision required by a change to the 403(b) Requirements (either by statute, or in regulations or other guidance published in the Internal Revenue Bulletin) or integral to the change. .01 This revenue procedure significantly modifies the procedures set forth in Rev. providing details regarding the system of cyclical Remedial Amendment Periods that follows the Initial Remedial Amendment Period. Proc. policy, Privacy The Bulletin is divided into four parts as follows: Part I.1986 Code. firms, CS Professional Section 403(b) Pre-approved Plan adoption agreement number (Each different adoption agreement associated with a single basic plan document must be assigned a 3-digit number, beginning with 001. This notice also modifies Notice 2020-71, 2020-40 I.R.B. The IRS has announced the special per diem rates that can be used to substantiate the amount of business expenses incurred for travel away from home on or after October 1, 2021. The likely respondents are banks, insurance companies, other financial institutions, law, actuarial, and consulting firms, employee benefit practitioners and Eligible Employers. Page Last Reviewed or Updated: 29-Sep-2022, Request for Taxpayer Identification Number (TIN) and Certification, Employers engaged in a trade or business who pay compensation, Electronic Federal Tax Payment System (EFTPS), News Releases for Frequently Asked Questions, businesses seeking coronavirus-related tax relief, Treasury Inspector General for Tax Administration, IRS provides guidance on per diem rates and the temporary 100% deduction for food or beverages from restaurants. If the plan provides for contributions other than elective deferrals and the Adopting Employers controlled group includes any employer that is not an Eligible Employer, the Adopting Employer may rely on the Opinion Letter, except with respect to whether contributions other than elective deferrals under the plan satisfy the requirements of 401(a)(4) and 410(b). Proc. Can an ERISA Plan Limit the Time a Claimant Has to File a Lawsuit for Plan Benefits? You may use the dropdown box below to select a country. Proc. 1121, during which certain telephonic hearings are permitted. In addition, the Mass Submitter may then submit applications for an Opinion Letter under this section 11.01 for its other plans, regardless of the number of identical adopters of the other plans. 172 (or its successor). However, an Adopting Employer of a Standardized Plan that adds language to satisfy the requirements of 415 due to the required aggregation of plans may obtain reliance with regard to 415 by applying for a determination letter using Form 5307 (as updated). [9] According to these regulations, the first and last days of travel are paid 75% of the daily General Services Administration, PDTATAC, or DOS rate, while all (6) An Adopting Employer makes an amendment to a 403(b) Pre-approved Plan that removes any of the required provisions of section 5. (3) Section 13.03 of Rev. Proc. If 4.b. The preceding sentence applies to an Eligible Employer that adopts a 403(b) Pre-approved Plan that amends or restates a plan maintained by the Eligible Employer, as long as the form of the plan that is being amended or restated satisfies the 403(b) Requirements at the time of the adoption of the 403(b) Pre-approved Plan. If an application is withdrawn, the case may be referred to IRS Employee Plans Examinations. However, this notification will only indicate that the plan appears to meet the applicable 403(b) Requirements under review as of the date of the notification. Optional special per diem rates. See Rev. For example, the adoption agreement, if applicable, should be amended to require that an Adopting Employer identify whether it is a non-QCCO (in which case, its employees participating in the plan would be subject to the nondiscrimination requirements of 403(b)(12)). 26 CFR 601.601: Rules and Regulations. Explore all Proc. For purposes of computing the amount allowable as a deduction for travel away from home, this notice is effective for meal and incidental expenses or for incidental expenses only paid or incurred on or after October 1, 2021. Per-diems are fixed amounts to be used for lodging, meals, and incidental expenses when traveling on official business. (5) If the plan provides for contributions other than elective deferrals and matching contributions, the plan must satisfy one of the design-based safe harbors described in 1.401(a)(4)-2(b)(2) with respect to the contributions. This revenue procedure applies to all ruling requests pending in or received by the Service on or after September 3, 2021. 2020-49. Proc. 575, to provide that an interim amendment made to a pre-approved plan qualified under 401(a) of the Internal Revenue Code (Code) is adopted timely if the amendment is adopted by the end of the second calendar year after the calendar year in which the change in qualification requirements is effective with respect to the plan. .02 Adoption Agreement Plan See section 4.27(2). In the interest of sound tax administration, the Service answers inquiries from individuals and organizations regarding their status for tax purposes and the tax effects of their acts or transactions. releases, Your Except in the case of certain Nonstandardized Plans described in this section 5.06, contributions other than elective deferrals (and earnings thereon) under a 403(b) Pre-approved Plan must vest at least as rapidly as would be required to satisfy the minimum vesting requirements of 411(a)(2)(B) applicable to a qualified plan under 401(a), even if the plan is not subject to the parallel minimum vesting requirements under ERISA 203. Proc. (3) Nonstandardized Plans may permit an Adopting Employer to select an allocation formula for contributions other than elective deferrals that satisfies one of the design-based safe harbors in 1.401(a)(4)-2(b)(2), and to select a safe harbor compensation definition for the formula that satisfies 1.414(s)-1(c). The IRS will not review for, and the Opinion Letter will not cover, any provisions included in Investment Arrangements. Each 403(b) Pre-approved Plan that is a Governmental Plan must credit all service with any employer aggregated with the Adopting Employer in a manner consistent with Notice 89-23, as service with the Adopting Employer maintaining the plan. A basic plan document and all associated adoption agreements should be submitted simultaneously. Changes to the information in the required appendix will not affect the Adopting Employers ability to rely on an Opinion Letter. 136 (as modified by Rev. 2019-48 may treat the meal portion of a per diem rate or allowance paid or incurred after Dec. 31, 2020, and before Jan. 1, 2023, as being attributable to food or beverages provided by a restaurant. 6 See section 2.20 of this revenue procedure for the extension of the expiration date of March 31, 2020, to June 30, 2020, by Notice 2020-35, 2020-25 I.R.B. 2018-42, 2018-36 I.R.B. .07 Applications for a minor modifier adopter of a Mass Submitters 403(b) Pre-approved Plan with respect to a Cycle will no longer be accepted after that Cycles Employer Adoption Window begins. See section 6.03. .01 Adopting Employer An Adopting Employer is an Eligible Employer that adopts a 403(b) Pre-approved Plan offered by a Provider, including a plan that is word-for-word identical to, or a Minor Modification of, a plan of a Mass Submitter. Revoked describes situations where the position in the previously published ruling is not correct and the correct position is being stated in a new ruling. Join the our free mailing list to receive an update when 2024 rates are available. Proc. The Remedial Amendment Period permits a plan to be amended retroactively to comply with a change in 403(b) Requirements; however, a plan must be operated in compliance with a change in 403(b) Requirements beginning on the effective date of the change. 2013-22 continue to apply to opinion and advisory letter applications for 403(b) Pre-approved Plans submitted for Cycle 1. Proc. (Compare with amplified and clarified, above). The amendment must be made in good faith with the intent of complying with the 403(b) Requirements. 944, and Rev. We establish the per diem rates for the continental United States (CONUS), which includes the 48 contiguous states and the District of Columbia. This information is required to enable the Commissioner, Tax Exempt and Government Entities Division of the Internal Revenue Service, to make determinations in connection with compliance with the 403(b) Requirements. The list of high-cost localities in this notice differs from the list of high-cost localities in section 5 of Notice 2020-71. a. 948, and Rev. (a) New plan In the case of a new plan, on the later of (i) the last day of the second calendar year following the calendar year in which the plan is put into effect, or (ii) in the case of a Governmental Plan, 90 days after the close of the third regular legislative session of the legislative body with the authority to amend the plan that begins after the end of the plans initial plan year. Suspended is used in rare situations to show that the previous published rulings will not be applied pending some future action such as the issuance of new or amended regulations, the outcome of cases in litigation, or the outcome of a Service study. Proc. In this case, in order to have reliance, the Adopting Employer would need to re-adopt the 403(b) Pre-approved Plan after the issuance of the Opinion Letter for the plan. (3) Notwithstanding the preceding provisions of this section 4.21, any person that has an established place of business in the United States where it is accessible during every business day may be a Provider that offers a plan that is word-for-word identical to a plan of a Mass Submitter (as an identical adopter) or a plan that includes Minor Modifications to a plan of a Mass Submitter (as a minor modifier adopter) regardless of the number of Eligible Employers that are expected to adopt the plan. If, after the 30-day period, neither action has been taken, the IRS may treat the application as having been withdrawn. The determination letter application must be filed during the applicable Employer Adoption Window (for example, a determination letter application for a Cycle 2 plan must be filed during the Cycle 2 Employer Adoption Window). ", Per diem localities with county definitions shall include"all locations within, or entirely surrounded by, the corporate limits of the key city as well as the boundaries of the listed counties, including independent entities located within the boundaries of the key city and the listed counties (unless otherwise listed separately).". .04 Cycle A Cycle is a Remedial Amendment Cycle, as defined in section 4.24. 2019-39 provides that an initial amendment that is intended in good faith to correct a Form Defect must be timely adopted by the Provider (or the Adopting Employer, if applicable) for the limited extension of the Initial Remedial Amendment Period to apply. 2016-37 sets forth the deadline for the timely adoption of an interim amendment to a qualified pre-approved plan. See section 4.27. This annual notice provides the 2021-2022 special per diem rates for taxpayers to use in substantiating the amount of ordinary and necessary business expenses incurred while traveling away from home, specifically (1) the special transportation industry meal and incidental expenses (M&IE) rates, (2) the rate for the incidental expenses only deduction, and (3) the rates and list of high-cost localities for purposes of the high-low substantiation method. High-cost localities. 2020-10, 2020-2 I.R.B. An official website of the United States government. financial reporting, Global trade & .06 Use of same basic plan document by multiple plans; separate applications required for different categories of Adoption Agreement Plans. Accordingly, the Treasury Department and the IRS continue to invite further comments on how to improve the Opinion Letter program. .25 Remedial Amendment Period The Remedial Amendment Period is the period during which a 403(b) plan may be amended to comply retroactively with the 403(b) Requirements. Significantly, the entire credit was refundable, meaning that it was available to those with no earned income. 2021-37), Room 5203, P.O. If the Provider does not wish to enable Adopting Employers to make loans available under their plans, the Provider would delete from the Providers plan the optional provisions in both the plan document and the adoption agreement. Find the answers to all your clients' questions about Social Security and Medicare in this essential Quickfinder handbook by Thomson Reuters Checkpoint. The estimated annual burden per respondent/recordkeeper varies from 1/2 to 2,000 hours, depending on individual circumstances, with an estimated average of 3.56 hours. 136, as modified by Rev. FICAFederal Insurance Contributions Act. To comply with the 403(b) Requirements, however, a plan must comply operationally with each relevant 403(b) Requirement, even if the requirement is not included on an Operational Compliance List. The meal portion is based on the average costs of three daily meals at dining establishments typically used by federal employees in that location. See section 8.03(7) regarding limitations on reliance. The IRS anticipates establishing a program that would permit Adopting Employers to apply for a determination letter on Form 5300, Application for Determination for Employee Benefit Plan, under rules and procedures similar to the rules and procedures applicable to 401(a) pre-approved plans (see section 20.03 of Rev. The principal author of this revenue procedure is Patrick Gutierrez of the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). 2016-37 provides that, for a governmental plan within the meaning of 414(d), the adoption deadline for an interim amendment is: the later of (1) the deadline that would apply under the rules of section 15.04(1), or (2) 90 days after the close of the third regular legislative session of the legislative body with authority to amend the plan that begins on or after the date the amendment becomes effective. For further information regarding this revenue procedure, contact Ms. Som de Cerff or Mr. White on (202) 317-6980 (not a toll-free number). .02 Extended deadline for interim and initial amendments Sections 22 and 23.02, relating to deadlines for interim and initial amendments, are effective for Form Defects first occurring on or after July 1, 2020, the day Cycle 2 began. 3507) under control number 1545-0047. customs, Benefits & M&IE Rate ($) 1 Breakfast Lunch 2013-22 to reduce the number of employers required to adopt a 403(b) Pre-approved Plan, to permit an application for an advisory letter for a volume submitter specimen plan to be filed by a Mass Submitter on behalf of a minor modifier of the Mass Submitters plan, and to extend the deadline for submitting a 403(b) Pre-approved Plan to the IRS for an opinion or advisory letter. (b) Newly Approved 403(b) Pre-approved Plan A Newly Approved 403(b) Pre-approved Plan, which is a plan for which an Opinion Letter has been issued for the Cycle. The Service is currently reviewing its prior ruling position on transactions described in section 3 of this revenue procedure. .20 Opinion Letter An Opinion Letter is a written statement issued by the IRS to a Provider or Mass Submitter that the form of a 403(b) Pre-approved Plan satisfies the 403(b) Requirements. Proc. The principal author of this notice is James Liechty of the Office of Associate Chief Counsel (Income Tax & Accounting). Dollars DSSR 925 All Locations Publication Date: 01/01/2023 The provisions of Rev. The application must be accompanied by the required user fee that will be provided in the successors to Rev. This part includes notices of proposed rulemakings, disbarment and suspension lists, and announcements. (2) Alternatively, by mail to: Internal Revenue Service, Attn: CC:PA:LPD:PR (Rev. Proc. Proc. NOTIFICATION OF ADOPTING EMPLOYER REGARDING FAILURE OF THE FORM OF THE PLAN TO SATISFY 403(b) REQUIREMENTS, SECTION 18. Proc. An Investment Arrangement may be an annuity contract under 1.403(b)-2(b)(2), a custodial account under 403(b)(7), or a Retirement Income Account. Proc. Section 1.415(f)-1(f)(2) includes a special rule providing that, if a participant on whose behalf a 403(b) annuity contract is purchased is in control of any employer for a limitation year, the 403(b) annuity contract is aggregated with all other defined contribution plans maintained by that employer. Such an application may be filed at the time of the assumption of plan sponsorship by the new Provider, and the filing is not limited to the applicable On-Cycle Submission Period. (a) Interim 403(b) Pre-approved Plan An Interim 403(b) Pre-approved Plan, which is a plan (other than a Newly Approved 403(b) Pre-approved Plan) that was not in existence in the immediately preceding Cycle and that has been or will be submitted for an Opinion Letter for the Cycle. 2019-39 provides that the initial amendment must be adopted by the later of (a) the expiration of the Initial Remedial Amendment Period (that is, June 30, 2020), or (b) the end of the calendar year following the calendar year in which the change in 403(b) Requirements is effective with respect to the plan. .02 Maintenance and availability of records of adopting employers A Provider must maintain, or have maintained on its behalf, for each of its plans, a record of the names, business addresses, and taxpayer identification numbers of all Adopting Employers. Thus, the term is used to republish under the 1986 Code and regulations the same position published under the 1939 Code and regulations. Proc. (5) An Adopting Employer chooses to discontinue participation in a 403(b) Pre-approved Plan that has been amended by the Provider, without substituting another 403(b) Pre-approved Plan. Proc. Proc. For purposes of this revenue procedure, an opinion letter for a prototype plan or an advisory letter for a volume submitter plan issued pursuant to Rev. 948. Proc. Rev. 2 The Department of the Treasury and the IRS also anticipate, subject to available resources, establishing a determination letter program for 403(b) individually designed plans that will be similar to the determination letter program for 401(a) individually designed plans. (2) Expiration of Remedial Amendment Period Unless otherwise specified in guidance published in the Internal Revenue Bulletin, the expiration date for a Remedial Amendment Period for a Form Defect first occurring after the Initial Remedial Amendment Period is described in this section 2.13(2). (2) After satisfying the requirement as to the number of adopting Providers, the Mass Submitter may submit additional applications on behalf of other Providers that wish to adopt a word-for-word identical plan to the Mass Submitter plan (as an identical adopter) or a plan that includes Minor Modifications to the Mass Submitter plan (as a minor modifier adopter). Additionally, a Cycle 1 403(b) Pre-approved Plan that is intended to be a Retirement Income Account may be amended to permit the participation of employees of certain church-related organizations, as described in 414(e)(3)(B), retroactive to the beginning of Cycle 2. Proc. The rate for any CONUS or OCONUS locality of travel for the incidental expenses only deduction is $5 per day. See section 21 of this revenue procedure for a description of when the Remedial Amendment Period for a Form Defect in a 403(b) Pre-approved Plan expires. .05 Expeditious processing accorded Mass Submitter plans Subject to section 12, all Mass Submitter plans, including approved Mass Submitter plans adopted by Providers, will be accorded more expeditious processing than plans submitted by non-Mass Submitters, to the extent administratively feasible. Rulings and procedures reported in the Bulletin do not have the force and effect of Treasury Department Regulations, but they may be used as precedents. For FY 2021, the standard Continental United States (CONUS) lodging rate will remain unchanged at No additional user fee will be charged if an inadequate submission is amended to be in substantial compliance and is resubmitted to the IRS within 30 days following the date the Provider is notified of the inadequacy. industry questions. Proc. As an additional savings measure, GSAs lodging per diem rate methodology includes taking five percent off the final average daily rate in each location. You can! Any Provider that does not wish to make the amendments made by a Mass Submitter may switch to another Mass Submitter or may submit an application for an Opinion Letter on its own behalf during the next applicable On-Cycle Submission Period for 403(b) Pre-approved Plans. Comprehensive 2013-22 for issuing an Opinion Letter regarding the satisfaction of the form of a 403(b) Pre-approved Plan with respect to the 403(b) Requirements. (5) In the case of multiple employers that are not part of the same controlled group (as determined under 414(b), (c), (m), or (o)) participating in the plan, each Adopting Employer must identify whether it is a Church, QCCO, non-QCCO, or minister. .02 Extension of deadline for initial amendment To be considered timely, the date by which the initial amendment described in section 4.11 must be adopted is extended to the later of (1) June 30, 2020, or (2) the end of the second calendar year following the calendar year in which the change in 403(b) Requirements is effective with respect to the plan. 2020-40 modifies Rev. Proc. 2019-39, that are related to a change in the 403(b) Requirements for the form of a plan; (6) amendments that reflect a change of a Providers name, in which case the Provider must notify the IRS, in writing, of the change in name and certify that it still meets the conditions to be a Provider described in section 4.21 (see also section 15 regarding changes in employer identification numbers); (7) amendments to the administrative provisions in the plan (such as provisions relating to investments, plan claims procedures, or the Adopting Employers contact information), provided the amended provisions are not in conflict with any other provision of the plan, still meet the requirements of this revenue procedure, and do not cause the plan to fail to satisfy the 403(b) Requirements (see section 11.03(1)(b)(ii) for additional examples of administrative provisions); and. In this case, the Adopting Employer will lose reliance on the Opinion Letter as of the date participation in the 403(b) Pre-approved Plan ends but the plan will remain eligible for the Cycle system (provided that the Adopting Employer adopts timely interim amendments) until the end of the Cycle that includes the date on which participation in the 403(b) Pre-approved Plan ends. is checked, are applications on behalf of at least 15 unaffiliated Providers who are sponsoring the identical basic plan document or Single Document Plan included with this application? See Rev. 2013-22 noted that the IRS was not establishing a determination letter program for 403(b) plans at that time, so that an employer adopting a 403(b) Pre-approved Plan would not be able to apply for an individual determination letter for the plan. For a Governmental Plan, Related Employers means all employers that are aggregated with the Adopting Employer in a manner consistent with Notice 89-23, 1989-1 C.B. .13 Nonidentification of questionable issues may cause delay If the 403(b) Pre-approved Plan submitted as part of an Opinion Letter application includes a provision that gives rise to an issue for which contrary published authorities exist, failure to disclose to the IRS and address any significant contrary authorities may result in requests for additional information, which will delay action on the application.
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