Employee Benefits Security Administration Eases New 403(b) Plan Reporting Requirements

The U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) last week provided transition relief for plan administrators of 403(b) plans who make a good faith effort to comply with applicable annual reporting requirements for the 2009 plan year.


The guidance in the EBSA’s Field Assistance Bulletin (FAB) no. 2009-02 allows 403(b) plans to avoid the administrative burden and expense of having to collect and include in their 2009 Form 5500 financial report information on certain individual annuity contracts and mutual fund custodial accounts of current and former employees that were entered into before 2009 and for which the employer has no ongoing contribution obligation.


In 2007, EBSA revised annual reporting rules under the Employee Retirement Income Security Act (ERISA) to, among other things, require that not-for-profit employers with 403(b) retirement plans covered by ERISA comply, starting this year, with the same financial reporting rules that apply to 401(k) plans.


The EBSA says that FAB 2009-02 complements separate transition relief issued by the IRS. IRS Notice 2009-3 says the Service will treat these plans as meeting the requirements of IRC Sec. 403(b) and the regulations during the 2009 calendar year if:


  • By Dec. 31, 2009, the plan sponsor has adopted a written 403(b) plan that is intended to satisfy the requirements of Sec. 403(b) and the regulations.
  • During 2009, the plan sponsor operates the plan in accordance with a reasonable interpretation of Sec. 403(b) and the related regulations.
  • By the end of 2009, the plan sponsor makes its best effort to retroactively correct any operational failure during the 2009 calendar year to conform to the written plan.


Additional resources on the new 403(b) reporting and audit requirements are available from the AICPA’s Employee Benefits Plan Audit Quality Center .



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