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Retirement Plans Newsletter

BULLETIN
October 3, 2024

 

[Official Guidance]

Text of IRS Notice 2024-73: Additional Guidance with Respect to Long-Term, Part-Time Employees, Including Guidance Regarding Application of Section 403(b)(12) to Long-Term, Part-Time Employees Under Section 403(b) Plans (PDF)

  • Q-1: Do the eligibility rules for ERISA LTPT employees under section 202(c) of ERISA apply to a section 403(b) plan that is not subject to title I of ERISA? A-1: No....
  • Q-2: Is a section 403(b) plan that is subject to ERISA required to provide the right to make elective deferrals to a part-time employee who qualifies as an ERISA LTPT employee? A-2: Yes....
  • Q-3: May a section 403(b) plan that is subject to ERISA continue to retain a part- time employee exclusion for part-time employees who do not qualify as ERISA LTPT employees? A-3: Yes....
  • Q-4: Is a section 403(b) plan that is subject to ERISA required to provide the right to make elective deferrals to a student employee who qualifies as an ERISA LTPT employee? A-4: No....
  • Q-5: May an employer with a section 403(b) plan that is subject to ERISA exclude ERISA LTPT employees for purposes of determining whether matching contributions satisfy the nondiscrimination requirements applicable to a section 403(b) plan under section 401(m)(2)? A-5: Yes....
  • Q-6: Can an employer use section 403(b)(12)(D) to continue to exclude an ERISA LTPT employee who later becomes eligible to participate in the plan for reasons other than the eligibility rules for ERISA LTPT employees under section 202(c)(1)(B) of ERISA from receiving nonelective or matching contributions or from the application of the nondiscrimination requirements in sections 401(a)(4), 401(m)(2), and 410(b) of the Code? A-6: No....

This notice applies for plan years beginning after December 31, 2024.... The final regulation related to section 401(k) LTPT employees will apply no earlier than to plan years that begin on or after January 1, 2026." [11 pages]  MORE >>

Internal Revenue Service [IRS]

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