IRS Offers Relief From Immediate Compliance With 403(b) Written Plan Requirement

The IRS issued 2009-3, providing relief during 2009 for sponsors of 403(b) plans on having a written plan in place by January 1, 2009.

In general, sponsors of 403(b) plans are required to have a written plan in place as of January 1, 2009, that satisfy the requirements of the final 403(b) regulations that were published July 26, 2007.

Under Notice 2009-3, however, they are granting relief from the requirement that the written document be in place on January 1, 2009, provided the following:

1. The plan sponsor has adopted the written plan on or before December 31, 2009.
2. During 2009, the sponsor operates the plan in accordance with a reasonable interpretation of 403(b), taking into account the final regs, and
3. Before the end of 2009, the sponsor makes its best efforts to retroactively correct any operational failures during the 2009 calendar year to conform to the terms of the written 403(b) plan.

Consult a qualified advisor to ensure that you comply with the requirements. See Notice 2009-3 at the following link.