
On Oct. 3, the IRS and Treasury Department issued Notice 2024-73 on long-term, part-time employees in 403(b) retirement plans under the SECURE 2.0 Act, which will apply to 403(b) plans starting in 2025, the CPA Practice Advisor reported.
CPA Practice Advisor also said the agencies announced a delayed applicability date for related final 401(k) regulations.
According to the IRS, a 403(b) plan, a tax-sheltered annuity plan or TSA, is a retirement plan offered by public schools and certain charities. It's like a 401(k) plan that is maintained by a for-profit entity.
• The Treasury Department and the IRS expect to issue proposed regulations regarding section 403(b)(12)(D) and guidance regarding sections 202(c) and 203(b)(4) of ERISA.
• The final regulation that the Treasury Department and the IRS intend to issue related to long-term, part-time employees under section 401(k) plans will apply no earlier than to plan years that begin on or after Jan. 1, 2026,
The notice features a question-and-answer portion on the application of the nondiscrimination rules of section 403 to long-term, part-time employees, including exclusions from making elective deferrals for students and employees who usually work less than 20 hours per week.
The agencies are requesting comments on the notice's content on or before Dec. 20, and they must include a reference to Notice 2024-73.