Vorys Benefits Brief: Retirement Plan Amendment Deadline Looming

Many retirement plans must be amended by December 31, 2026 to bring the plan document into compliance with a number of legislative changes.  To ensure your plan document accurately reflects your plan’s operation and remains in compliance with law, you should review your plan now to determine which of the changes apply. 

Background

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Divisions M and O of the Further Consolidated Appropriations Act, 2020 (SECURE Act), and Division T of the Consolidated Appropriations Act, 2023 (SECURE 2.0 Act) made many changes to the laws governing qualified retirement plans.  Some of these changes are mandatory and require an amendment to the plan. Others are optional and only require an amendment if the plan sponsor elects to adopt them.  

The federal government provided an extended period of time (referred to as the remedial amendment period) between the date these laws were enacted and the deadline for plans to be amended to align the plan documents with their operation.  The remedial amendment period for most plans will end on December 31, 2026.  Plans sponsored by governmental employers and a small group of collectively bargained plans qualify for a longer remedial amendment period.

Next Steps for Plan Sponsors

Plan sponsors should review and inventory the changes implemented for their retirement plans over the last six years as a result of the CARES Act, SECURE Act, and SECURE 2.0 Act.  Each change will need to be accurately reflected in an applicable plan amendment.  Pay particular attention to effective dates because many plans implemented features after the earliest possible date.

Plan sponsors with pre-approved plans should work with their pre-approved plan provider to ensure that their amendments are drafted with sufficient time to enable review and adoption before December 31, 2026.  Draft amendments should be reviewed carefully, as we regularly see issues with initial drafts of revised adoption agreements.  We recommend getting legal advice to ensure that (1) all required amendments have been made, and (2) no unintended changes are made to your plan’s features.

Contact Legal Counsel

For questions or additional information about this Vorys Benefits Brief and its application, consult with legal counsel.