Universal Availability in 403(b) Plans [2019]

FIS Relius Education

With the upcoming end to the 403(b) remedial amendment period (and the adoption of plan documents by more 403(b) sponsors), the IRS is focusing more attention on 403(b) plans. One of the primary focuses in IRS examinations of 403(b) plans is the universal availability requirement. A 403(b) plan, unlike a 401(k) plan, does not have an ADP test. However, 403(b) plans are subject to the universal availability rule (elective deferral nondiscrimination requirement). In general, the universal availability rule requires a 403(b) plan to cover all employees and prohibits the plan from imposing an eligibility requirement with respect to elective deferrals. However, the rule does permit the plan to exclude certain employees (e.g., the 20 hour/week exclusion).

The exclusions come with very specific rules. In recent guidance, the IRS has provided some flexibility with respect to universal availability as to exclusions for ERISA plans and with respect to the application of eligibility requirements for 403(b) plans. Because the universal availability requirement continues to be a hot topic for IRS examiners, understanding the universal availability rule, the exclusions and the recent flexible IRS interpretations is absolutely necessary for all 403(b) practitioners

In this 60-minute webcast, we provide you with an understanding of the universal availability requirement and explain how to correct a violation of this important 403(b) requirement.

Topics include:

• Universal availability requirement
• Plans exempt from the requirement
• Exclusions
• New IRS guidance
• ERISA vs. non-ERISA plans
• 20 hour/week exclusion and the "once in always in" rule
• Correction of failure

After attending this Web seminar, an attendee should be able to:

• Explain the universal availability rule
• Apply the exclusions
• Implement new IRS guidance
• Design plans to take advantage of the new guidance
• Correct a plan that has violated the universal availability requirement
• Apply properly the 20 hour/week exclusion

Speaker: David Schultz, J.D.

More Information, How to Register