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The Final 403(b) Regulations and You
By January 1, 2009, the IRS will expect Plan Sponsors to be very involved in operating their 403(b) plans. The final 403(b) regulations, which came out in July 2007, impose greater responsibility on you for managing information and duties related to your 403(b) plan, including:
- Written documentation of plan features
- Approval of loans, hardship withdrawals, transfers and other distributions
- Notices sent annually to remind your employees about their ability to save for retirement through your 403(b) plan.
These new tasks will mean more work for you and your staff; and, because the IRS will be auditing plans, more accountability as a Plan Sponsor.
While most of the IRS rules go into effect after next year, the IRS expects you to start sharing certain information about employees with your plan vendors as early as September 25, 2007. In the weeks and months ahead, as you get ready to assume your expanded role, it is absolutely crucial to choose investment and service providers with the 403(b) expertise to satisfy the new requirements. Now more than ever, you can rely on ING to offer the assistance, information, tools and services you need to comply with these new IRS rules. The items below will help you begin planning and executing on your tasks. ING will continue to provide helpful tools in the coming months.
Information for Healthcare and Nonprofit Organizations
403(b) Plan Documents
ING is pleased to provide you with the following 403(b) Plan Documents for Healthcare and Not-For-Profit Organizations. A plan sponsor should review the appropriate plan document, together with legal counsel to the extent appropriate, to determine whether additional modifications to the plan document may be necessary to address specific facts, circumstances, and applicable law.
Please note that this document is offered by ING as:
- a 403(b) plan document for 501(c)3 organizations intended to meet the requirements of the final 403(b) regulations issued on July 24, 2007 (Federal Register (72 FR 41128));
- a plan document substantially similar to the IRS model plan language under Rev. Proc. 2007-71. The document has not been reviewed or approved by the Internal Revenue Service.
How to adopt the ING 403(b) plan document for ING Specimen Plan Document for Non-ERISA 403(b) Plan (not church or government related) - Employee Deferrals Only
Please note that this document is offered by ING as:
- a 403(b) plan document for ERISA Plans intended to meet the requirements of the final 403(b) regulations issued on July 24, 2007 (Federal Register (72 FR 41128));
- a plan document substantially similar to the IRS model plan language under Rev. Proc. 2007-71. Additional features in this 403(b) plan document are the ability to offer Roth 403(b) and/or Employer Contributions under your 403(b) plan, which are not addressed by the IRS model plan language. The document has not been reviewed or approved by the Internal Revenue Service.
Specimen Board Resolution to authorize a 501(c)(3) organization to adopt the plan document and to authorize the appropriate official to sign the document.
Healthcare and Not For Profit 403(b) Sample Letters and Sample Information Sharing Agreement (ISA)
Specimen communications that can be used by Employers with their 403(b) plan Investment Providers and Employees about the contract exchanges/transfers (formerly known as 90-24) changes.
Specimen Letter: Employer To Provider Requesting Information Sharing Agreement (ISA) (doc 28kb)
- RM or Rep. can provide this specimen letter to the Employer
- Employer can consider this specimen for use when attempting to obtain an Information Sharing Agreement from another provider
- If this letter is provided to the Employer, the sample Information Sharing Agreement described below should be attached
Specimen Information Sharing Agreement - 403(b)(1) Plans Only (doc 35kb)
- Employer can consider this specimen ISA for use with another provider
- If this is provided to the Employer, the letter described above must also be provided
Specimen Letter: Employer To Inform Employees Of New Contract Exchange/Transfer (Formerly Known As 90-24) Procedure (doc 28kb) and Specimen Letter: Employer Official To Inform Employees Of Approved Providers (doc 26kb)
- RM or Rep can provide these specimen letters to the Employer
- Employer can consider the first specimen letter for use in describing to Employees the expected contract exchange procedure
- Employer can consider the second specimen letter for use in informing the Employees of the contact exchange approved provider list
These materials are not intended to be used to avoid tax penalties, and were prepared to support the promotion or marketing of the matter addressed in this document. The taxpayer should seek advice from an independent tax advisor.
Insurance products, annuities, and retirement plan funding options issued by (third party administrative services may also be provided by) ING Life Insurance and Annuity Company, One Orange Way, Windsor, CT 06095-4774. Annuities issued by ReliaStar Life Insurance Company, 20 Washington Avenue South, Minneapolis, MN 55401. Securities offered through ING Financial Advisers, LLC (member SIPC), and other broker-dealers with which it has selling agreements. These companies are members of the ING family of companies. Insurance obligations are the responsibility of each individual company. Products and services may not be available in all states.
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