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Comparing 457(b), 457(f), and Split-Dollar Plans for Nonprofits

"Nonprofit organizations often look for ways to attract and retain key executives through deferred compensation arrangements. Three common approaches are the 457(b) plan, 457(f) plan, and split-dollar life insurance plan. Each can supplement retirement benefits, but they differ in eligibility, funding, and tax treatment."

2024 Final Regs Complicate MHPAEA Analysis

"To replace QTL/NQTL regulations finalized in 2013, the Departments of the Treasury, Labor, and Health and Human Services proposed regulations in 2023 that solicited 9,503 comments. After review, the Departments issued final regulations on September 10, 2024. The 2024 rules shift the focus of the regulations from the process of applying NQTLs to the outcomes of that application. The key changes are addressed [in this article]."

Mandatory Roth Catch-Up Contributions: Are You (and Your Service Providers) Ready for It?

"[If] a worker does not have FICA wages (e.g., a governmental agency employee not covered by a Section 218 Agreement), Section 603 does not apply.... If your plan's service providers cannot confirm they have appropriate systems in place to comply with Section 603's requirements, and you are considering prohibiting catch-up contributions until they do, this would require an advance amendment prior to January 1, 2026. "

Deadline for Non-Profit 457(b) Plan Amendments Is December 31, 2025

"For non-profit plan sponsors of 457(b) plans, this is an important opportunity to not only satisfy the required updates but also to review any additional changes to conform the plan document to intended plan design and operations going forward. Amendments must be formally adopted by December 31, 2025, and plans should operate in accordance with the updated provisions to avoid compliance problems."

Section 1557: A Battleground for What's Considered Discrimination on the Basis of Sex

"Because the injunctions granted in Tennessee v. Becerra and Texas v. Becerra are nationwide, the enforcement of the 2024 Rule is enjoined even in states where the 2024 Rule was not challenged.... It is highly anticipated that the Supreme Court will ultimately be called on to decide whether Section 1557 prohibits discrimination on the basis of sexual orientation, gender identity, and sexual stereotypes. This will require the Supreme Court to address an issue it declined to in Skrmetti -- whether Bostock's reasoning applies outside of the Title VII context."

401(k) Plans: Alternative Investments Are in and En Vogue, But Are They the Right Choice for Your Plan?

"[P]lan sponsors and 401(k) plan fiduciaries should understand two things: first, plan fiduciaries' duties under ERISA have not changed (at least for now). Second, plan fiduciaries are not required to offer alternative assets as an investment option to plan 401(k) participants. Employers considering offering alternative investments in their plans will want to ensure they understand their fiduciary responsibilities, seek appropriate investment advice, appropriately document their investment selection decisions, revisit their plan investment policy statements, and consult with legal counsel."

Enhanced Premium Tax Credits Are Ending, But ACA Penalties Are Increasing

"While many will no longer be eligible for PTCs beginning in 2026, applicable large employers should not get too comfortable because the Bill did not repeal the employer shared responsibility penalties -- and they are about to get more expensive. ... Smaller employers should annually revisit the ALE determination ... Keep related employers in mind ... Review the look-back measurement method policy ... Ensure workers are classified correctly."

It's Time to Restate Your Pre-Approved 403(b) Plan

"Each employer that sponsors a 403(b) plan which uses a pre-approved plan document must ensure that document is restated to account for changes in law by December 31, 2026. Especially for those nonprofit and public sector organizations characteristically facing resource and staffing constraints, it’s crucial to start the restatement process now."

New Administration, New Rules, and More to Come

"Crypto in 401(k) plans.... ESG/fiduciary rules ... Private equity investments in retirement plans."

District Court Throws ACA Employer Mandate Enforcement Into Question

"Employers who have paid Section 4980H penalties may be eligible for a refund and may want to consider filing a protective refund claim before the statute of limitations expires. Employers currently facing IRS assessments for Section 4980H penalties may have grounds to challenge the enforcement of the employer mandate." [Faulk Company, Inc. v. HHS, No. 24-0609 (N.D. Tex. Apr. 10, 2025)]