Restatements Today and Tomorrow

An Oct. 19 session of the 2021 ASPPA Annual conference took a look at what’s going on with restatements and what the future may hold. 

Under Revenue Procedure (Rev. Proc.) 2020-10, said Brian Furgala, Director of ERISA Services of Wolters Kluwer, the Cycle 3 restatement period began May 1, 2020 and will end on Jan. 31, 2025. Defined benefit document vendors, he said, have already submitted documents for review and many have been assigned IRS reviewers. 

Furgala said that he is “guessing that Feb. 1, 2023 will be when the two-year restatement window opens” for DB restatements, but added that there has been no official word on that yet. 

SECURE Act and CARES Act 

Furgala noted that the Setting Every Community Up for Retirement Enhancement (SECURE) Act, signed into law on Dec. 20, 2019. and the Coronavirus, Aid, Relief and Economic Security (CARES) Act, enacted March 27, 2020, contain a variety of provisions relevant to restatements and plan amendments that take place before them. 

For instance, under both measures, amendments must be completed by the last day of the plan year beginning after Dec. 31, 2021. For calendar plan years, the deadline under both is Dec. 31, 2022. 

In addition, the provisions of both laws are not included in Cycle 3 defined contribution restatement documents. Those documents will not be included in Cycle 3 DB restatement documents. Instead, said Furgala, Cycle 3 DC restatement documents are going to be add-ons. 

Vendors are likely to combine SECURE Act and CARES Act amendments into one amendment, with the same signing deadline, Furgala told attendees.

Amendment Timing

Furgala noted that the timing for amendments of pre-approved DB plan documents, individually drafted DB plan documents and DC plan documents and 403(b) documents is the same—the last day of the plan year beginning after Dec. 31, 2021. 

And if SECURE 2.0 is passed soon, Furgala added, that may delay the deadline under the original SECURE Act to match potential a SECURE 2.0 deadline of the last day of the plan year beginning after Dec. 31, 2022. For calendar plan years, it would be Dec. 31, 2023. “The best-case scenario is that there is a consistent deadline in the new law,” he remarked.