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austin3515, thank you for helping me with your thinking. Let’s remark on some of your several smart observations (and some I add). “[A]t least you knew what the answers were[.]” For interpretations of the Internal Revenue Code, a plan sponsor, an employer, a plan administrator, and a participant, beneficiary, or alternate payee or alternate recipient still gets at least practical protection in following agency rules. For example, if a retirement plan’s administration follows Treasury interpretations about a tax-qualification condition, the IRS is unlikely to tax-disqualify the plan for failing to meet that condition. It might be capricious if it did so. And in filing tax returns and information returns, a taxpayer or reporter would have “reasonable cause” support for filing a return grounded on an employee-benefit plan’s having followed Treasury interpretations, even those that are not the correct reading of the statute. For Federal taxes, the agency is the enforcer. About ERISA, the Secretary of Labor should not pursue enforcement if the plan’s administrator followed the Labor department’s rule. Although a court does not defer to an agency’s interpretation, for an agency not to follow its own rule-made interpretation might be capricious. How independent interpretations of a statute might help Imagine the Treasury department publishes its final LTPT rule in 2024. Remember, the 1978 Reorganization Plan allocates to the Treasury department some interpretive authority for ERISA’s part 2. Imagine in 2025 a § 401(k) plan’s administrator denies an employee entry for elective deferrals. The plan’s governing document excludes the employee under a classification other than age or service, which the administrator finds is not contrary to ERISA § 202. The employee sues under ERISA § 502(a)(1)(B), asking a Federal court to declare she is eligible. (Or, as you suggest, a big employer/administrator faces an alleged class action for all similarly excluded employees.) The plaintiff asserts ERISA § 202 commands she is eligible as a long-term part-time employee. She argues the Treasury rule, including its interpretation about whether a classification is a subterfuge against the LTPT command, is the persuasive interpretation of ERISA § 202. Yet with no more Chevron deference, the plan’s administrator may argue a different interpretation of the statute. A final decision in a particular case protects the plan’s administrator for whatever was litigated in that case. “Forfeitures cannot be used to fund QNECs[.]” That’s an example of a situation in which being free to argue the interpretation of the statute might have helped some employers—those with the resolve and resources to fight the IRS. Congress’s express direction to make a rule. The Supreme Court’s decision yesterday leaves undisturbed other precedents that allow an agency’s rulemaking to ‘fill-in the details’ if Congress’s Act states a delegation and enacted “an intelligible principle to which the [agency] authorized to take action is directed to conform.” Yesterday’s opinion states: “When the best reading of a statute is that it delegates discretionary authority to an agency, the role of the reviewing court . . . is, as always, to independently interpret the statute and effectuate the will of Congress subject to constitutional limits. The court fulfills that role by recognizing constitutional delegations, ‘fix[ing] the boundaries of [the] delegated authority,’ and ensuring the agency has engaged in ‘reasoned decisionmaking’ within those boundaries[.]” For example, Internal Revenue Code § 401(a)(9) includes six express delegations to rulemaking. For those fill-in-the-details points, a court might recognize that Congress intended a later-made Treasury rule as a part of the statute. “I really think EPCRS is reviewable now.” The IRS’s corrections programs are grounded from Congress’s grant of authority to make closing agreements: “The Secretary is authorized to enter into an agreement in writing with any person relating to the liability of such person (or of the person or estate for whom he acts) in respect of any internal revenue tax for any taxable period.” I.R.C. (26 U.S.C.) § 7121(a). Even if the IRS oversteps that authority, who would challenge an EPCRS closing agreement? One presumes not the employer/administrator that obtained the correction satisfaction. And who else would have standing to dispute the IRS’s compromise of the taxes the IRS otherwise could assert? No ERISA right to an automatic-contribution arrangement For the reasons mentioned above, it might not matter if the IRS too generously interprets Internal Revenue Code § 414A about whether an automatic-contribution arrangement is a tax-qualification condition. The consequence of a plan’s failure to meet IRC § 414A(b)’s conditions is that the plan’s arrangement that otherwise might be a qualified cash-or-deferred arrangement is not a § 401(k) arrangement. But it’s the IRS, not a private litigant, that applies Federal tax law. ERISA does not generally command that an individual-account retirement plan provide an automatic-contribution arrangement. If a plan’s governing documents omit an automatic-contribution arrangement, there is none. “It seems to me that the risk of administering 401k plans has gone up (as employers).” Many employers and plan administrators might follow an executive agency’s interpretations. When they do, they shouldn’t fear enforcement by the agency. A participant’s, beneficiary’s, or alternate payee’s or alternate recipient’s civil action on an ERISA claim is likely only when the situation calls the litigation resources. For example, almost none of the excessive-fee lawsuits against an individual-account retirement plan’s named fiduciary was about a plan with less than $500 million. Likewise, civil actions asserting that an employer/administrator excluded people the plan or ERISA made participants were mostly against big employers, think Microsoft. “I doubt the result of this will be Congress writing better laws that perhaps need less interpretation.” I think that’s so, at least until the United States returns to having a functioning legislature. And even when a legislature does quality lawmaking, there will be gaps and other ambiguities. “[W]e’re going to need more courts and judges and lawyers. A lot more.” Yes! I tell my current and former students there will be plenty of demand for one’s skills. Yet, for many plans, the practical interpretations might not change much. Many plan administrators do not regularly engage an employee-benefits lawyer. Many tend to administer plans using frameworks set with recordkeepers, third-party administrators, and other service providers. And those frameworks tend to follow (or attempt or purport to follow) the agencies’ interpretations. An employer/administrator needs lawyering when it seeks an interpretation to allow doing something an agency’s interpretation doesn’t allow (or about which there is no agency interpretation), or to get better protection than the agency’s interpretation affords. Others, especially small plans’ administrators, fall in with a mainstream good-enough. Further, many questions of law might never get a court’s decision. For some, that’s a feature, not a bug.

The participants is what I was thinking.

If a federal district court rendered such a decision, would that be binding precedent that other plan administrators could reply upon? Would it be applicable nationwide, or only within the same federal circuit? Could we end up with different precedents, and therefore different standards for the same issues, in different parts of the country?

Verily, and with great haste, thou shalt consulteth thy plan's governing documents and discover therein the answers thou seekest. Should fortune smile upon thee, thou may findest that thy plan be graced with a determination letter, be it sealed by the hand of the wise ones who dwell within the halls of the Internal Revenue Service, granting reliance upon the terms found therein. In that happy moment, thou shalt knowest that thy plan's allowances of in-service distribution of rollover accounts shall never be said to fail to satisfy the requirements of section 401.

John Feldt is right that the Internal Revenue Service’s discretion to refuse an opinion letter for an IRS-preapproved document can be a way to push an agency’s interpretations, including even unpublished interpretations. A plan’s sponsor might overcome some problems by adding and changing “administrative provisions” to the extent the Revenue Procedure allows without defeating reliance on the IRS’s opinion letter. Or even risking that one has lost reliance. A plan’s administrator might overcome some problems by using the plan’s grant of discretion to interpret the plan. In doing so, knowing that Federal courts interpret statutes without deference to an agency’s interpretation sometimes might help defend a plan administrator’s interpretation of a governing document’s nonsense. Yet, those steps might leave behind some plan provisions that are neither an ERISA command nor a condition of tax-qualified treatment. ERISA § 404(a)(1)(D) calls a fiduciary to meet its responsibility “in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of [ERISA] title [I] and title IV.” This is not advice to anyone.

And what does the statute, and for that matter, the regulation, say about this minimum meaningful benefit of 0.50% as a life annuity at Normal Retirement that all these pre-approved documents now require? Anyway, if a plan wants reliance on its written language, I am not seeing how this Chevron change would undo the power that the treasury holds there. Sponsors are still bound to the terms of their written plans.

Once money is rolled into the plan, it’s rollover money and it doesn’t matter what it was in the other plan. Our plans (almost) always allow participants to take a distribution of rollover money at any time. Read the document and it will tell you.

Forfeitures cannot be used to fund QNECs (i know they fixed that one but man that one got under my skin!) And maybe the courts would not agree that a zero QNEC is appropriate to correct 15 months of not implementing an auto enrollment. I really think EPCRS is reviewable now. There are often statutes that say “the irs shall write regulations no later than” so I am not convinced the statute you referenced will protect it. Maybe it makes them more protected, but who knows. How about some challenge to the conclusion that employee class exclusions are permitted under the LTPT statute. I can imagine some sort of a class action thing where a large group of employees was improperly excluded from the ability to participate based on the IRS position. And doesn’t this sort of thing require the IRS to be far more conservative on these types of decisions? Imagine if this was reversed in 5 years by the Supreme Court in favor of excluded participants. and along the same lines, the IRS concluded that a new spin off plan is not subject to auto enrollment. I can see a class action here too over the meaning of “established.” Regulations are a pain. But at least you knew what the answers were and could more or less take them to the bank. Now we have to consider the level of consistency between the reg and the statute (especially important questions where the statute is silent, like LTPTs and excluded classes). It seems to me that the risk of administering 401k plans has gone up (as employers). And it also seems to me we’re going to need more courts and judges and lawyers. A lot more. Somehow, I doubt the result of this will be Congress writing better laws that perhaps need less interpretation.