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On February 23rd, the IRS issued a memorandum to its examiners instructing them not to challenge a 403(b) plan for failing to satisfy the required minimum distribution (“RMD”) rules with respect to missing participants or beneficiaries if the plan sponsor has taken certain specific steps to find them.

Generally, the RMD rules require that a 403(b) participant must begin taking minimum distributions by the April 1st following the year the participant reaches age 70 ½ or, if the plan allows, the April 1st following the year that the participant retires, if later.  Questions frequently arise regarding whether the IRS may challenge a plan for failing to timely commence benefit payments to participants that the plan is unable to locate.

Posted in IRS

On April 6, 2016, the Department of Labor under the Obama administration issued a new final rule and exemptions addressing when a person providing investment advice with respect to an employee benefit plan or individual retirement account is considered to be a “fiduciary” under the Employee Retirement Income Security Act of 1974 (“ERISA”) and the Internal Revenue Code.  The fiduciary rule aimed to reduce the allegedly conflicted investment advice given to retirement savers, and was scheduled to become applicable on April 10, 2017.  See our client alert here outlining the significance of the rule and the implications of the expanded definition of “fiduciary” for investment advisors and other related service providers.