IRS Issues Windsor Guidance for Qualified Retirement Plans

by Ropes & Gray LLP
Contact

On April 4, 2014, the IRS released Notice 2014-19, providing guidance on the application of United States v. Windsor to qualified retirement plans. The Notice is the third significant piece of guidance issued by the IRS on the application of the Supreme Court’s decision on June 26, 2013 invalidating the provision in the 1996 Defense of Marriage Act that defined marriage as between a man and a woman. The initial IRS guidance is described in our Alert of August 30, 2013.

The Notice provides welcome guidance on the timing requirements for qualified retirement plans to reflect the Windsor decision by treating persons in same-sex marriages the same as persons in opposite-sex marriages. Specifically, the Notice provides guidance on the following points:

  • Plan operations are required to reflect the Windsor outcome only as of June 26, 2013. This means that qualified plans are not required to recognize same-sex marriages for dates prior to June 26, 2013.
  • Qualified plans are not required to have determined whether same-sex couples are married by reference to the state law under which the marriage was celebrated before September 16, 2013, the effective date of Rev. Rul. 2013-17, which announced the IRS position on this question. This means that plans will not be penalized for having determined marital status by reference to the participant’s state of domicile before September 16, 2013.
  • Plans can choose to comply with the outcome of Windsor as of any date prior to June 26, 2013, and can choose the purposes for which same-sex marriages are recognized for periods prior to that date. For example, a plan sponsor may choose to amend its plan to recognize same-sex marriages solely for purposes of the qualified joint and survivor annuity requirements and solely with respect to participants with annuity starting dates on or after a specified date before June 26, 2013. The Notice notes that early recognition may create implementation challenges.
  • Plans with terms that are inconsistent with the Windsor decision must be amended to reflect the Windsor decision by the later of (i) the date the plan otherwise would have to be amended for changes in applicable law (generally, the later of the end of the plan year in which the change is first effective and the due date of the employer’s tax return for the tax year that includes the date the change is first effective) and (ii) December 31, 2014.  Governmental plans have until the end of the first regular legislative session of the body with amendment authority that ends after December 31, 2014.
  • Plans with a funded status that generally prohibits certain amendments may nevertheless be amended effective June 26, 2013 to reflect the outcome of Windsor. However, such plans are generally not permitted to adopt amendments implementing the Windsor decision as of an earlier date.

This guidance will allow plan sponsors to determine the effect of the Windsor decision on the written terms of their qualified retirement plan and allows plan sponsors flexibility in determining how to bring their plan into line with the Windsor decision.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Ropes & Gray LLP | Attorney Advertising

Written by:

Ropes & Gray LLP
Contact
more
less

Ropes & Gray LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.