Required Retirement Plan Amendments for 2024 and Beyond

As the end of 2024 quickly approaches, it is time for sponsors of tax-qualified plans to review their plan documents and the applicable annual Internal Revenue Service (IRS) Required Amendments List (RA List) to ensure their compliance with IRS plan amendment deadlines and requirements. Fortunately, there are no required amendments to adopt before the 2024 year-end. However, for most plan sponsors, it is also the time to formally adopt discretionary amendments made to the plan during the 2024 plan year.

2024 Discretionary Amendments

For qualified plans, whether individually designed or utilizing a preapproved plan document, the deadline to adopt any discretionary amendments is the last day of the plan year. For calendar year plans that date is December 31, 2024. Plan sponsors will want to consult with their counsel and providers to make sure that their plan document accurately reflects how the plan operated in 2024 and adopt any necessary or desirable amendments before the end of the plan year.

2022 RA List for 2024 Required Plan Amendments

Generally, an RA List sets forth amendments that must be adopted to certain individually designed qualified plans, individually designed Section 403(b) plans, and pre-approved plans with respect to interim amendments because of changes in laws or regulations. An RA List requires that the specified amendments be made to the plans involved on or before the last day of the second calendar year after the issuance of the RA List. Therefore, for the 2022 RA List, December 31, 2024 would be the plan amendment deadline. The 2022 RA List, however, did not list any required amendments for which December 31, 2024 would be the last day of the remedial amendment period.

As a reminder, annual, monthly or other periodic revisions to (1) the dollar limits adjusted for cost-of-living increases under Code Section 415(d) or other Code provisions, (2) the spot segment rates used to determine the applicable interest rates under Code Section 417(e)(3), and (3) the applicable mortality table under Code Section 417(e)(3) are deemed to be included on the RA List for the year in which any such changes are effective.

Looking Ahead to 2025

The last day to adopt an amendment required by the 2023 RA List would be December 31, 2025. However, the 2023 RA List did not list any required amendments for which plan sponsors would need to act by December 31, 2025.

Looking Further Ahead to 2026

On December 5, 2024, the IRS issued Notice 2024-82, containing the 2024 RA List. Any required amendments provided in the 2024 RA List will need to be adopted by December 31, 2026, which is the last day of the remedial amendment period.

As in past years, the 2024 RA List is divided into parts. Part A describes changes in legislative changes that require amendments to affected plans. Like the two prior annual RA Lists, no required amendments are listed for which December 31, 2026 would be the deadline for adoption.

Part B includes changes in requirements that will not require amendments to most plans but may require an amendment because a particular plan contains the affected provisions. The 2024 RA List describes two such potential amendments. The first requires the application of the limit to benefits and contributions under Code Section 415 to certain employees of rural electric cooperatives. The second potential amendment relates to changes in the family attribution rule for determining whether businesses are related.

This year’s RA List includes a new Part C, which identifies changes in requirements relating to amendments already adopted by plan sponsors with respect to optional provisions under the CARES Act, the Miners Act, the SECURE Act and the SECURE 2.0 Act. The deadline to formally adopt these changes to the already adopted optional provisions is December 31, 2026. Described below are the most commonly adopted optional amendments and the guidance describing the further changes required:

• In-service Coronavirus-Related Distributions. If this optional provision under the CARES Act was adopted, Notice 2020-50 provides further requirements regarding these distributions that must also be adopted.
• Required Minimum Distributions (RMDs). If plans adopted RMD relief under the CARES Act, such as the waiver of the 2020 RMDs or allowing rollovers of the waived RMDs, then the further guidance is provided in Notice 2020-51, Notice 2023-54 and Notice 2024-35.
• Qualified Birth or Adoption Distributions (QBADs). For plans that adopted this optional provision under the SECURE Act, plans must comply with the further requirements described in Notice 2020-68 and SECURE 2.0 Act’s provision limiting the repayment period to the 3-year period beginning on the day after the date the distribution was received.
• Minimum Age for In-Service Distributions. The Miners Act permitted defined contribution plans to lower the minimum age for in-service distributions from 62 to age 59-1/2. It also permitted governmental 457(b) plans to allow in-service distributions at age 59-1/2, a significant decrease from 70-1/2. For plans that adopted these changes, further required changes are provided in Notice 2020-68.
• Safe Harbor Plans. For safe harbor 401(k) and 403(b) plans that adopted the SECURE Act’s provisions relating to increasing the limit on automatic enrollment elective deferral contributions to 10%, foregoing certain notice requirements for safe harbor nonelective contributions or retroactively adopting safe harbor nonelective contribution status, further required changes can be found in Notice 2020-86. SECURE 2.0 Act also clarified the annual safe harbor notice requirement.
• Small Immediate Financial Incentives. If employers offered small immediate financial incentives to encourage employees to contribute to the employer’s retirement plan under SECURE 2.0 Act, Section D of Notice 2024-2 provides additional requirements.
• Roth Matching or Nonelective Contributions. Under SECURE 2.0 Act, defined contribution plans were permitted to adopt a provision allowing participants who are 100% vested to designate employer matching or nonelective contributions as Roth contributions. If this optional provision was adopted, further requirements are described in Section L of Notice 2024-2.
• Cash Balance Plan Testing. For cash balance plans that use variable interest credit and have pay credits that increase with age or service, SECURE 2.0 Act permitted such plans to use a reasonable projection of the variable interest crediting rate up to 6% for purposes of benefit accrual rules under Code Section 411(b). Section H of Notice 2024-2 describes further requirements.
• Anti-Abuse Rules Related to Pension-Linked Emergency Savings Accounts (PLESAs). Defined contribution plans that added a PLESA, as provided in SECURE 2.0 Act, must also comply with the requirements provided in Notice 2024-22.
• Exceptions to the 10% Additional Tax on Early Distributions. Notice 2024-55 provides further requirements for plan amendments that allow the domestic abuse victim distributions and/or emergency personal expense distributions provided under SECURE 2.0 Act.
• Replacement of a SIMPLE With a Safe Harbor 401(k). SECURE 2.0 provides that an employer may replace a SIMPLE retirement account with a safe harbor 401(k) plan during a year. If this option was chosen, Section G of Notice 2024-2 describes further guidance.

As a reminder, deadlines related to the required and discretionary plan amendments under provisions of the CARES Act, the Miners Act, the SECURE Act and the SECURE 2.0 Act are as follows:

If you have any questions about Notice 2024-82, required amendments, or any other amendment you are contemplating for your tax-qualified or other retirement plan, please contact any member of our Employee Benefits and Executive Compensation practice group.