The December 31, 2026 deadline is fast approaching for most non-governmental plan sponsors to amend their tax-qualified retirement plans to comply with changes made by the SECURE Act of 2019, the CARES Act, the Taxpayer Certainty and Disaster Relief Act of 2021, and the Secure 2.0 Act (the “Acts”). Now may be a good time to review your retirement plan(s) to make sure all amendments are complete and your administrative procedures have been updated.

Staggered Deadlines. As background, IRS Notice 2024-02, published in January 2024 (the “Notice”), extended and consolidated deadlines for employers and others sponsoring 401(k), 403(b), 457(b) and other retirement plans to amend their plan documents as required by the Acts. The staggered deadlines are as follows:

December 31, 2026

• Tax-qualified retirement plans (excluding governmental plans, state or local government 457(b) plans, collectively-bargained plans, and public school 403(b) plans)

December 31, 2028

• Collectively bargained (union) plans

December 31, 2029

• Governmental plans[1]
• 403(b) plans sponsored by a public school
• 457(b) plans sponsored by a state or local government

While your plan does not generally have to be amended until the deadlines listed above, it is important to recognize that you must still make sure that your plan is operated in compliance with the required provisions of the Acts as of their statutory effective dates.  Thus, you should have already updated your internal plan procedures and payroll system to comply with the Acts.

Mandatory Amendments.  Below is a list of some of the mandatory amendments that are required to comply with the Acts:

• Long-term, part-time worker coverage.
• Increased starting ages for required minimum distributions (“RMDs”).
• No RMDs from designated Roth accounts.
• Special death benefit elections.
• Automatic enrollment mandate for new 401(k) and 403(b) plans.
• Mandatory Roth catch-up deferrals for higher wage earners.
• Fiduciary discretion not to recover overpayments.

If you terminate your retirement plan prior to the above deadlines, then you must amend that terminated plan to take effect to comply with the Acts at the time of or prior to its termination.

Discretionary Amendments. Note that if you want to make any of the discretionary amendments that are permitted under the Acts, then you must amend your plan prior to the desired effective date of such discretionary changes.  Discretionary amendments allowed by the Acts include:

• Super catch-up contributions for age 60-63.
• Increase of small account cash-out limits from $5,000 to $7,000.
• Roth employer contributions.
• Matching of student loan payments.
• Emergency distributions permitted by SECURE and SECURE 2.0.
• 2020 RMD waiver.
• COVID-related distributions and loan relief.
• Self-certification for hardship distributions.

For additional information on the mandatory and discretionary amendments required by these Acts, please see IRS Notice 2024-02 and Revenue Procedure 2022-40.

Steps for Plan Sponsors. 

• In most cases, prototype and volume submitter plan providers have already worked with their plan sponsor clients to implement the necessary amendments.
• If you are unsure if your plan has been amended to comply with these requirements, you should check with your plan document provider and/or legal advisor.  
• Consider whether you want to implement any of the Acts’ discretionary amendments for your next plan year (or if you’ve already implemented some of these features, confirm that you timely amended your plan to provide for it).
• Make sure that you have updated your internal plan procedures and payroll to implement any new operational requirements.
• Make sure your summary plan description (SPD) and plan notices are updated to reflect any changes.

The Nelson Mullins Employee Benefits Group is ready to assist with questions or to discuss your options. Please contact one of our Employee Benefits attorneys or the Nelson Mullins attorney with whom you work.