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Windsor Amendments Required Before Year End For Some Retirement Plans

Publications - Client Alert | April 10, 2014

Late last week the IRS issued guidance (Notice 2014-19) regarding required amendments to qualified retirement plans in response to United States v. Windsor (“Windsor”). You may recall that on June 26, 2013, the United States Supreme Court issued an opinion in Windsor that found the Defense of Marriage Act’s definition of marriage, as a legal bond between one man and one woman, unconstitutional. 

In September, the IRS issued Revenue Ruling 2013-17 requiring retirement plans to define spouse as any individual legally married to a participant based on the laws of the state of celebration. The Revenue Ruling was effective September 16, 2013, but stated that retirement plans do not need to be amended until further guidance is issued. 

Last week’s Notice provides the promised amendment guidance. The key elements of Notice 2014-19 are:

  • If a retirement plan’s definition of spouse conflicts with Windsor or references the Defense of Marriage Act, the plan must be amended generally by December 31, 2014. Government plans have until the last day of the first legislative session that ends after December 31, 2014.
  • Qualified retirement plan operations must comply with Windsor effective June 26, 2013. This will require some plans to identify and correct operational failures primarily with regard to spousal consent and joint and survivor annuities.
  • Notice 2014-19 only references plans qualified under Internal Revenue Code Section 401(a) (e.g. 401(k) plans and defined benefit pension plans). The IRS website states that the guidance also applies to 403(b) plans, however these plans are not subject to the December 31, 2014 deadline. The IRS has not yet announced the amendment deadline for 403(b) plans.
  • Between June 26, 2013 and September 16, 2013, retirement plans need only recognize marriages that are legal in the state of residence. Beginning on September 16, 2013, retirement plans must recognize marriages that are legal in the state of residence or the state of celebration.
  • Plans may elect to apply Windsor to periods prior to June 26, 2013. The IRS warns plan sponsors considering retroactive application that it may create some practical difficulties. The IRS promises future guidance on retroactive application of the Windsor decision. 
Next steps
  • Determine your Plan’s effective date(s) for complying with Windsor.
  • Discuss operational compliance with your plan service providers.
  • Determine whether plan corrections are required.
  • Review the plan document and determine if an amendment is required.
  • Review participant distribution forms and the plan’s Summary Plan Description for consistency with Windsor and revise as necessary.

Please let us know how we can assist you with this process.

Additional Information

For more information regarding retirement plan qualification requirements, contact your Kutak Rock LLP attorney or a member of our Employee Benefits Practice Group.