IRS Publishes Annual Cumulative List of Changes in Plan Qualification Requirements for Certain Retirement Plans:

The IRS published Notice 2017-37 (the “Notice”) on June 30, 2017, which provides the “Cumulative List of Changes in Plan Qualification Requirements for Pre-Approved Defined Contribution Plans for 2017” (the “2017 Cumulative List”). As with the IRS’s previous annual cumulative lists, the 2017 Cumulative List identifies changes in the Internal Revenue Code’s retirement plan qualification requirements that must be taken into account in a “pre-approved” (i.e. a prototype or a volume submitter) plan document that is submitted to the IRS for an Opinion Letter. Prior to Revenue Procedure 2016-37, which as of January 1, 2017 eliminated the five-year remedial amendment cycle system for individually- designed plans, the IRS also used its cumulative lists when reviewing individually-designed plan documents.

The 2017 Cumulative List must be used by plan document drafters when submitting Opinion Letter applications for “pre-approved” defined contribution plans during the third six-year remedial amendment cycle. As noted above, defined contribution plan documents can be submitted to the IRS for such approval from October 2, 2017 to October 1, 2018. The 2017 Cumulative List provides specific matters the IRS has identified for review when it determines whether a “pre-approved” defined contribution plan document that has been filed for an Opinion Letter has been properly updated for applicable law changes. Such matters include the following:

  • The word “marriage” in a plan document cannot be limited to only a legal union between one man and one woman as husband and wife, and the word “spouse” in a plan document cannot refer only to a person of the opposite sex who is a husband or a wife.
  • IRS guidance provides a special nondiscrimination rule for a qualified defined contribution plan that provides lifetime income. That rule applies if the plan offers as investment options a series of target date funds (“TDFs”) that include deferred annuities among their assets, even if some of the TDFs within the series are available only to older participants.
  • IRS regulations provide a limited modification of the required minimum distribution rules for tax-qualified defined contribution plans that hold qualifying longevity annuity contracts.
  • IRS guidance addresses permitted mid-year reductions or suspensions of safe harbor nonelective and matching contributions, and IRS guidance permits certain mid-year changes to safe harbor 401(k) plans.
  • IRS regulations provide that qualified matching contributions and qualified nonelective contributions must satisfy applicable vesting and distribution requirements when they are allocated to participants’ accounts, but need not meet these requirements when they are contributed to the plan.

Here is a link to the 2017 Cumulative List: