Employers sponsoring 403(b) plans should be aware that we are nearing the deadline for adopting a pre-approved 403(b) plan that provides relief for any documentary noncompliance back to January 1, 2010 (or, if later, the effective date of the plan). As a reminder, adopting a pre-approved plan is the only way a plan sponsor may now be assured that its plan document meets all IRS requirements. A pre-approved plan can take different forms, but essentially it is a document with some options that the employer selects, and additional standard terms that apply universally. The options and the standard terms are submitted to the IRS for approval, so that any employer that timely adopts the documents can rely on the IRS opinion issued to the sponsor of the pre-approved document that it meets all IRS requirements.

In Revenue Procedure 2017-18, the IRS announced a deadline of March 31, 2020 for adopting pre-approved 403(b) plans in order to receive retroactive relief for any noncompliant plan provisions. Shortly thereafter, it began issuing opinions on plans submitted by sponsors of volume submitter and prototype 403(b) plan documents.

All 403(b) plan sponsors were first required to have a plan document in place by the end of 2009, effective January 1, 2009. Prior to that time, plan documents were only required for 403(b) plans that were subject to ERISA.