New Revenue Procedure Establishes 403(b) Pre-Approved Plan Program (Posted on April 29, 2013 by )

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The IRS will start accepting applications for opinion and advisory letters for prototype and volume submitter 403(b) plans (tax-sheltered annuities and custodial accounts for certain tax-exempt and governmental employers) on June 28, 2013. Rev. Proc. 2013-22, 2013-18 I.R.B. 985 (April 29, 2013) explains the procedures for obtaining such letters. The IRS has also provided sample plan language for 403(b) plans, which may be useful not only to prototype and volume submitter plans, but to all types of 403(b) plans.

Notice 2009-3, 2009-2 I.R.B. 250, had stated that “the Service and Treasury have concluded that compliance with the 2007 regulations would be facilitated by the establishment of both pre-approved and individually designed plan programs[.]” However, Rev. Proc. 2013-22 provided only for pre-approved plans. It is unclear at this time whether private letter rulings will continue to be available with respect to individually designed plans.

The Comparison of 457(b) Plans, 401(k) Plans, 403(b) Plans, and Deemed IRAs has been updated to reflect this development.