Retirement News 

 for Employers

 Tax Information for Sponsors of Retirement Plans Internal Revenue Service Tax Exempt and Government Entities

Volume 6, Spring 2009

A Look Inside

New Federal Income Tax 

Optional Withholding for 

Pensions...more on page 2

Last chance to take our survey 

about this newsletter...more on 

page 5

The IRS is requesting 

membership nominations for the 

Information Reporting Program 

Advisory Committee...more on 

page 5

The IRS offers e-News for Small 

Businesses – a free, bi-weekly 

newsletter that alerts small 

business owners to what’s new 

and important...more on page 6

Free phone forum on EPCRS...

more on page 6

Automatic enrollment plans are 

discussed by Monika Templeman, 

EP Exam Director in Desk Side 

Chat...more on page 7

Notice of Approval to Extend 

Form 5500 Filing....more on 

page 12

Also in this Issue

 We’re Glad You Asked! 3

 Recent Guidance 8

 New on the Web 10

 DOL News 11

 Mark Your Calendar 13

 Timing is Everything 14

Do You Have a Safe Harbor 401(k) Plan? Ahhh...Relief

The IRS, on May 18, 2009, published proposed regulations, Suspension or Reduction 

of Safe Harbor Nonelective Contributions, that would amend Regulations under Code 

§§401(k) and 401(m). These proposed regulations provide employers incurring a 

substantial business hardship an alternative to terminating their §401(k) safe harbor plans. 

Employers meeting certain requirements can reduce or suspend required safe harbor 

nonelective contributions without losing their plan’s qualified status.

Background

Plans that contain a qualified cash or deferred arrangement (CODA) allow eligible 

employees to make a cash or deferred election with respect to their wages, meaning, 

these employees get to choose whether part of their wages are contributed as elective 

contributions to the plan or paid to them in cash. A qualified CODA must satisfy certain 

nondiscrimination requirements, including either the actual deferral percentage (ADP) test 

or one of the safe harbors under §401(k)(11), (12) or (13). A plan that allows employee 

contributions or provides for employer matching contributions is required to satisfy another 

nondiscrimination requirement called the actual contribution percentage (ACP) test or one 

of the safe harbors under §401(m)(10), (11) or (12). Generally, a plan that meets the safe 

harbor requirements is also exempt from the rules for top-heavy plans. 

A plan that that intends to be a §401(k) safe harbor plan must:

•	 adopt a safe harbor plan before the beginning of the plan year that specifies 

whether the employer will make matching or nonelective contributions; 

•	 maintain the safe harbor plan throughout a full 12-month plan year subject to 

certain exceptions (explained below);

•	 notify each eligible employee within a reasonable period before the beginning of 

each plan year of his or her rights and obligations under the plan; and

•	 make either matching or nonelective contributions at least as great as the rates 

required by its safe harbor. 

There are two exceptions to the general requirement that an employer maintain a §401(k) 

safe harbor plan throughout a full 12-month plan year. An employer may:

 1. amend a plan to reduce or suspend safe harbor matching contributions on future 

 employee elective contributions for a plan year, or 

2. terminate its safe harbor plan during the plan year. 
Spring 2009 Retirement News for Employers

Requirements for reducing or suspending §401(k) safe harbor 

matching contributions:

An employer must amend the plan to provide for the reduction or suspension 

and to satisfy all applicable nondiscrimination tests for the entire plan year. The 

effective date of the amendment cannot be earlier than 30 days after the plan 

notifies eligible employees of the suspension or reduction. Eligible employees 

must be given a reasonable opportunity to change their salary deferral elections 

after receipt of the notice. The plan must make all safe harbor matching 

contributions up to the amendment’s effective date and must prorate the 

§401(a)(17) compensation limits.

Requirements for terminating a §401(k) safe harbor plan during the 

plan year:

An employer must make all required §401(k) safe harbor matching 

contributions through the date of termination. It must demonstrate that the 

plan would have satisfied all the requirements for amending the plan to reduce 

or suspend safe harbor matching contributions (other than the requirement 

that employees have reasonable opportunity to change their elections). 

Alternatively, the plan may terminate if the termination is in connection with 

a transaction described in §410(b)(6)(C) (minimum coverage requirement in 

certain situations involving acquisitions and dispositions) or if the employer 

incurs a substantial business hardship (comparable to a substantial business 

hardship under §412(c), previously under §412(d)).

Some factors taken into account to determine if an employer has suffered a 

substantial business hardship include whether: 

•	 the employer is operating at an economic loss,

•	 there is substantial unemployment or underemployment in the trade or 

business and in the industry concerned, and

•	 the sales and profits of the industry concerned are depressed or 

declining.

Provisions of the proposed regulations:

The proposed regulations allow an employer that suffers a substantial business 

hardship to amend its plan to reduce or suspend the plan’s safe harbor 

nonelective contributions if all the following requirements are satisfied:

•	 the plan is amended prior to the end of the plan year to reduce or 

suspend the safe harbor nonelective contributions;

•	 the plan as amended, provides that the ADP test (and ACP test if 

applicable to the plan) will be satisfied for the entire plan year in 

which the safe harbor nonelective contributions are reduced or 

suspended;

•	 all eligible employees must be given a “supplemental notice” that 

explains the reduction or suspension of future safe harbor nonelective 

contributions and its consequences, the procedures for changing 

employee elections and the effective date of the amendment; 

2

New Federal Income Tax 

Withholding for Pensions

On May 14, 2009, the IRS announced

new withholding adjustment 

procedures that could help some 

recipients of pension plan income 

avoid a smaller refund or even a 

balance due next April. These optional 

adjustment procedures are available in 

Notice 1036-P, Additional Withholding 

for Pensions for 2009, and may be 

used by pension income payors to 

adjust withholdings from pension 

payments. Payors who elect to use the 

optional adjustment procedures are 

encouraged to contact retirees who 

previously requested an adjustment to 

their withholdings after the February 

tables were released. Various factors, 

such as other earned income, can 

affect how much withholding, if any, 

is needed by people receiving pension 

income to satisfy their annual tax 

liability.
Spring 2009 Retirement News for Employers

•	 the reduction or suspension of the safe harbor nonelective 

contributions can occur no earlier than 30 days after 

giving eligible employees the supplemental notice and the 

amendment’s adoption date, if later;

•	 all eligible employees must be given a reasonable period of 

time after they receive the supplemental notice (but prior to 

the reduction or suspension of the safe harbor nonelective 

contributions) to change their salary deferral elections; and

•	 the §401(a)(17) compensation limits must be prorated. 

A plan that amends to reduce or suspend safe harbor nonelective 

contributions will be subject to the rules for top-heavy plans.

These proposed regulations are effective for amendments adopted after 

May 18, 2009 but plans may rely on them pending issuance of final 

regulations. To the extent the final regulations are more restrictive than 

these proposed regulations, they will not be applied retroactively.

We’re Glad You Asked!

I received notice before 2009 that my employer’s safe harbor 

401(k) plan would match dollar-for-dollar up to the first 3% 

of my contribution to the plan and 50 cents on the dollar of 

my contribution above 3% and up to 5%. However, I was 

recently notified that my company will not make any matching 

contributions this year. Can they do this?

Yes. Due to the economic crisis, many employers are facing a tough choice 

to either terminate their 401(k) retirement plans or, alternatively, reduce 

or suspend matching contributions. An employer may reduce or suspend 

matching contributions after amending its plan. The employer must send a 

notice to all eligible employees of:

•	 the plan’s amendment to reduce or suspend matching 

contributions, and

•	 their right, within a reasonable amount of time, to change their 

salary deferral election (the amount they contribute to the plan). 

The employer must also make the matching contributions at the plan’s 

previously stated rate for at least 30 days after it gives notice to employees. 

As an employee, you can generally elect, for 2009, to contribute the lesser 

of 100% of your salary or $16,500 ($22,000 if age 50 or older).

Additional Resource:

Regulations 1.401(k)-3

Each issue of the RNE looks at a common question we receive and provides an answer 

and additional resources in response to the question.

3
Spring 2009 Retirement News for Employers

I told my former employer that I wanted to roll over my 401(k) 

account balance to a traditional IRA. Can I change my mind and 

roll it over to a Roth IRA instead?

You can roll over money from your 401(k) to a Roth IRA if you meet 

certain income and filing requirements. The actions you need to take 

depend on whether or not the transfer of your 401(k) account balance to the 

traditional IRA has been completed. 

To be able to roll over the 401(k) funds to a Roth IRA, you must meet both 

of the following conditions for the year of the rollover:

1. your modified adjusted gross income (MAGI) for Roth IRA 

purposes is $100,000 or less; and

2. you are not a married individual filing a separate return.

If the rollover has not been completed:

•	 If you elected to do a direct rollover and the money has not 

yet been transferred to a traditional IRA, contact your plan 

administrator and change your rollover designation from a 

traditional IRA to a Roth IRA.

The plan administrator will complete Form 1099-R so that it 

properly reflects the rollover to the Roth IRA. 

•	 If you chose to receive the 401(k) money and roll it over yourself, 

simply roll it to a Roth IRA within 60 days of receipt. Although in 

this case, you will have to replace the 20% withheld for income 

taxes if you want to roll over the entire amount that was in your 

401(k) account.

You must include in your gross income the total previously untaxed amount

that was in your 401(k) account.

If the rollover has been completed:

If the plan administrator has completed your original request to transfer 

the money to a traditional IRA or you have already completed the 

rollover yourself, you may move the funds to a Roth IRA through what is 

commonly called a “conversion.”

You must satisfy the MAGI and filing status conditions specified above to 

make the conversion.

A conversion may be accomplished by a withdrawal from the traditional 

IRA and subsequent contribution to the Roth IRA within 60 days; or it may 

be accomplished by a direct transfer from a traditional to a Roth IRA. 

If you convert a traditional IRA to a Roth IRA, for the year in which you 

transfer the money out of your traditional IRA, you must:

1. include in your gross income the previously untaxed amount; and

2. report the amount converted on Form 8606 and attach it to your tax 

return.

4
Spring 2009 Retirement News for Employers

Like What You are Reading?

Please help us to improve the Retirement News 

for Employers. Take our short, anonymous 

survey and tell us about the articles you like 

or what you think should be in future editions. 

Let us know by May 27, 2009.

In the case of a direct rollover, you must tell the plan administrator the type 

of IRA (traditional or Roth) into which you want your funds deposited, so 

the Form 1099-R can be filled out correctly. Properly notifying them of the 

type of IRA eliminates any confusion. 

Form 1099-R:

If, in error, you told the plan administrator the funds are being directly 

rolled over to a traditional IRA, the Form 1099-R will show no taxes due. 

You should tell the plan administrator about the mistake as soon as possible 

so that the Form 1099-R will correctly show that taxes are due on the 

previously untaxed amounts.

Regardless of how the Form 1099-R is completed, an individual moving 

previously untaxed money into a Roth IRA is obligated to pay taxes on 

that money. 

See Publication 590, Individual Retirement Arrangements (IRAs), for 

additional information. 

Information Reporting Program Advisory Committee 

Is Looking for New Members

The IRS is requesting membership nominations for the Information 

Reporting Program Advisory Committee (IRPAC). The deadline for 

submitting applications is May 29, 2009.

IRPAC is made up of 35 members who are appointed to three-year terms by 

the Commissioner. Each year, approximately one-third of the membership 

terms expire. Nominations are currently being accepted for up to six 

appointments that begin January 2010.

Established in 1991, IRPAC provides recommendations to the IRS on 

a wide range of information reporting and administration issues. The 

committee is made up of taxpayers, tax professionals and representatives 

from small and large businesses, colleges and universities, state tax 

administrators and payroll, insurance, banking and other financial 

industries. The IRPAC Committee presents a report to the IRS 

Commissioner every fall.

More information, including an application form, is available on the Tax 

Professionals page. Questions about the nomination process can be sent to 

the following e-mail address: *public_liaison@irs.gov.

5
Spring 2009 Retirement News for Employers

EPCRS Phone Forum - July 27, 2009

Joyce Kahn, Manager, Employee Plans Voluntary Compliance, and 

Avaneesh Bhagat, Employee Plans Voluntary Compliance Program 

Coordinator, will conduct a one-hour presentation on the Employee Plans 

Compliance Resolution System (EPCRS). The discussion will provide 

a brief overview of EPCRS and will focus on the most recent EPCRS 

guidance, Revenue Procedure 2008-50.

Free registration is now open until July 17, 2009.

•	 Register at EP Phone Forum.

•	 You will be assigned a Personal Identification Number (PIN) that 

must be used to join the conference. 

•	 If you have never registered with AT&T phone forum, you will 

need to click on “create a profile” first.

Dial in on July 27, 2009, toll free: 1 (866) 216-6835

•	 Dial in 15 to 20 minutes before the scheduled time. 

•	 Enter your access code, then the pound (#) sign. 

•	 Enter your PIN, then the pound (#) sign. 

•	 Your line will be placed on hold until the conference begins.

Continuing Professional Education credits:

•	 An enrolled agent may earn one CPE credit if he or she listens 

to the presentation for 50 minutes. Other professional groups 

should consult with their respective licensing agencies regarding 

acceptability of credit. 

•	 To receive credit, each participant must register individually and 

use his or her own PIN on an individual phone line.

•	 Certificate of Completion will be e-mailed to participants who 

meet the above requirements about a week after the forum. 

If you have question(s), please contact us at ep.phoneforum@irs.gov.

Conference

Access Code Eastern Central Mountain Pacific

196805 2:00 p.m. 1:00 p.m. 12:00 p.m. 11:00 a.m.

e-News for Small Businesses: A TimeSaver for You

Keeping up with federal tax requirements 

is not easy in today’s fast-changing 

business environment. Even if you use 

a tax professional’s services, you still 

need to know and understand your tax 

responsibilities.

That’s why the IRS offers you a time-saver: 

e-News for Small Businesses – a bi-weekly 

newsletter that alerts you to what’s new 

and important for small business owners. 

It’s quick to read, easy to subscribe to 

– and it’s free.

The e-News for Small Businesses features:

•	 Tax dates to help small business 

owners avoid missing a deadline; 

•	 Links to new items on IRS.gov for 

small businesses; 

•	 Reminders and tips to help you 

meet your tax obligations; 

•	 Quick links to IRS news releases 

and announcements; and

•	 Info about IRS products, services 

and educational opportunities.

Subscribe to e-News for Small Businesses

on IRS.gov, click “Subscribe Now” at the 

bottom of the page and enter your e-mail 

address.

6
Spring 2009 Retirement News for Employers

Desk Side Chat...With Monika Templeman

Automatic Enrollment

What is automatic enrollment?

Automatic enrollment is an automatic contribution arrangement that 

can be used as a feature in a retirement plan to allow employers to 

enroll employees in the company’s plan once they become eligible to 

participate. The employer can then automatically reduce an employee’s 

pay by a default percentage as stated in the plan and contribute 

that amount to the employee’s plan account (automatic enrollment 

contribution). Employees only need to complete paperwork if they want 

a different amount withheld or to affirmatively elect not to participate in 

the plan. Generally, any plan that allows employee contributions can be 

amended to include the automatic contribution arrangement feature. The 

employee is 100% vested in automatic enrollment contributions.

Are plan sponsors using the automatic enrollment feature?

This feature is becoming very popular. According to a survey completed 

last year, more than 50% of large plans use automatic enrollment to 

some degree and the usage by small business plans doubled from the 

previous year. 

For those plan sponsors who are still undecided on whether 

to amend their plans to add the feature, what are some of the 

benefits?

The benefits are many. Having a retirement plan helps an employer 

attract and retain very good employees, which in turn will save in 

recruiting, hiring and training costs. With some retirement plans, the 

significant tax advantage for the plan sponsor is deducting employer 

contributions. The benefit for the plan participants is deferring tax on 

pre-tax contributions and their earnings until later distributed. By having 

an automatic enrollment feature, an employer can assist employees in 

starting to save for their retirement. Younger employees often think 

of a new car, a new home, marriage and children before considering 

saving for retirement. This is one way to get them to participate in 

the employer’s retirement plan as soon as they are eligible. Finally, 

having the automatic enrollment feature will most likely improve the 

plan’s chances of passing the nondiscrimination test, or ADP test, if 

applicable to that plan, because more nonhighly compensated employees 

participate. 

Can you give the readers a brief explanation of the acronyms 

contained in the recently released final regulations? Let’s start 

with ACA.

I would be happy to. ACA stands for automatic contribution 

arrangement. We could describe it as the foundation, as the other 

types of arrangements we will discuss are built from this arrangement. 

Under a plan’s ACA, the plan will state that it will automatically 

In each issue, Monika Templeman, Director of EP Examinations, responds to 

questions and offers insights on retirement plan topics uncovered during audits. You 

may provide feedback or suggest future topics for discussion by e-mailing her at: 

RetirementPlanComments@irs.gov

Automatic Enrollment

7
Spring 2009 Retirement News for Employers

enroll employees unless they elect otherwise. The plan must specify the 

percentage of an employee’s wages that will be automatically deducted 

from each paycheck as a contribution to the plan. The plan document 

must also provide that employees have the right to elect not to have 

salary deferrals withheld or to elect a different percentage to be withheld. 

Employees must be timely notified of these rights.

EACA is the next acronym. What does that stand for?

EACA stands for eligible automatic contribution arrangement. It is 

generally an ACA that provides that the automatic contribution percentage 

is a uniform percentage of compensation. An EACA is also exempted 

from certain distribution restrictions that otherwise apply to many plans. 

For example, an EACA may:

•	 allow participants to make permissible withdrawals – participants 

can elect to withdraw any automatic enrollment contributions 

within 90 days of when they were first made; and

•	 distribute excess contributions and excess aggregate contributions 

to correct any applicable failed nondiscrimination tests within 6 

months of the end of the plan year without the employer incurring 

the otherwise applicable 10% excise tax. 

What is the benefit of using an EACA?

The main benefit is the plan’s ability to offer permissible withdrawals. A 

basic ACA cannot offer this feature.

When do the final regulations become effective for EACAs?

The final regulations were effective when issued (February 24, 2009) and 

they generally apply to plan years beginning on or after January 1, 2010. 

However, plans using an EACA are required to operate in good faith 

compliance with the statute (Code §414(w)) prior to that time.

The last acronym is QACA. What does that stand for?

A qualified automatic contribution arrangement (QACA) is a type of 

ACA that allows a 401(k) plan to automatically pass the annual ADP 

and ACP nondiscrimination tests and the top-heavy tests. Generally, the 

plan must include certain required features, such as automatic employee 

contributions at certain specified minimum percentages of compensation 

that increase annually up to 6% by the fourth year but cannot exceed 10%, 

mandatory employer contributions, a special vesting schedule and specific 

notice requirements.

I’ll ask the same question here as I did with EACA: What is the 

benefit of using a QACA?

The major reason plan sponsors use the QACA is to know that, as long 

as they meet the requirements of a QACA, they will not be required to 

perform the nondiscrimination and top-heavy testing required for other 

automatic enrollment plans.

Employee Plans Published Guidance

Announcements

Announcement 2009-34, 2009-18 I.R.B. 916

IRS will soon establish a program for preapproval of §403(b) prototype plans. This 

announcement includes a draft revenue 

procedure for issuing opinion letters for 

§403(b) prototype plans. IRS posted draft 

sample plan language to use to draft §403(b) 

prototype plans. IRS invites public comments 

before finalizing the 403(b) revenue procedure 

and sample plan language.

Notices

Notice 2009-22, 2009-14 I.R.B. 741

Provides interim rules regarding asset 

valuation methods permitted to be used by 

single employer defined benefit pension plans 

for minimum funding under the Worker, 

Retiree, and Employer Recovery Act of 

2008 (WRERA). This notice also provides 

automatic approval to change the asset 

valuation method for plan years beginning 

during 2009 and adopt any permissible asset 

valuation method.

8
Spring 2009 Retirement News for Employers

Do the final regulations have the same effective date for 

QACAs as for EACAs?

No. Although the effective date is the same - February 24, 2009 - the final 

regulations for QACAs are generally applicable for plan years beginning 

on or after January 1, 2008. The only provision delayed until 2010 is 

the requirement to use a safe harbor definition of compensation for 

determining automatic enrollment contributions.

Am I correct in assuming this discussion only begins to touch 

on the requirements contained in the final regulations? 

Yes. I have provided a very broad overview of the rules governing 

automatic contribution arrangements. However, I do want to emphasize 

their usefulness to get employees to start saving for their retirement 

as soon as they become eligible to participate in a retirement plan. 

Today, people are living longer and the cost of retirement is getting 

more expensive. An employer has an important role to play in helping 

employees save for their future and automatic enrollment is a proactive 

way to get employees to save now and continue to save. I only have so 

much room in this newsletter and could only provide a brief glimpse into 

the automatic enrollment world. 

For plan sponsors wanting more information on automatic enrollment, 

see “Final Regulations Issued for Automatic Contribution Arrangements” 

in the Spring Edition of the Employee Plans News, which contains links 

to the final regulations and Acts that have impacted automatic enrollment. 

We also have a publication, Automatic Enrollment 401(k) Plans for Small 

Businesses, that discusses the automatic enrollment feature.

Contributors to this Issue:

John Berger

Anita Bower

Kathy Davis

Roger Kuehnle

Teresita Laureano

Mark O’Donnell

Nancy Payne

John Schmidt

Brenda Smith-Custer

Monika Templeman

Mikio Thomas

Kathy Tuite

9
Spring 2009 Retirement News for Employers

New on the Web

Here are the latest postings to the Retirement Plans Community web page: 

IRS Requests Comments on Pilot Government Plan 

Questionnaire 

We sent a Government Plan Questionnaire to a pilot group of governmental 

plans and posted it for public comment. Our goal is to provide 

governmental plans with tools, assistance and programs to help plans 

comply with federal pension law. This initiative will provide us with 

valuable information on how governmental plans comply with the Internal 

Revenue Code.

WRERA Election Form

Employee Plans Compliance Unit has provided a WRERA election form

for multiemployer plans to satisfy the election and notice procedures under 

WRERA §§204 and 205, as described in Notice 2009-31.

Nonamenders and Voluntary Correction Program (VCP)

Voluntary Correction has written an explanation of how nonamender 

failures can be corrected through VCP. This explanation will tell you 

all you need to know about filing for relief, including when you can file 

(with examples of when Appendix D or F should be used) and when 

a determination letter application should be filed as part of the VCP 

submission.

EP Team Audit (EPTA) Program

The EPTA (Large Case Program) web pages have been updated to include:

•	 EPTA Trends and Tips (now organized according to plan type):

•	 Common Trends Across All Plan Types

•	 Multiemployer Plan Trends

•	 401(k) Plan Trends

•	 Defined Benefit Plan Trends

•	 403(b) Tax-Sheltered Annuity Plan, 457 Plan and 

Governmental Plan Trends

“EPTA Trends and Tips” includes links to videos on the EPTA 

program and on finding, fixing and avoiding plan errors. 

•	 Internal Controls Questionnaire - Examples of questions asked by 

EP examiners to understand the system procedures and internal 

controls.

•	 Taxpayer Documentation Guide - This guide, developed by EPTA 

agents and outside practitioners, provides a comprehensive list of 

documents that need to be made available for examination. 

10
Spring 2009 Retirement News for Employers

DOL News

The American Recovery and Reinvestment Act of 2009 (ARRA)

If you have a group health plan subject to COBRA, the ARRA includes 

provisions that may apply to your plan. The ARRA expands eligibility for 

COBRA continuation coverage and provides a premium reduction to certain 

qualified individuals. Eligible individuals pay only 35% of their COBRA

premiums and the remaining 65% is reimbursed to the employer, insurer or 

health plan through a tax credit. The premium reduction applies to periods of 

health coverage beginning on or after February 17, 2009, and lasts for up to 

nine months.

Individuals eligible for COBRA coverage because of an involuntary 

termination of employment that occurred from September 1, 2008 through 

December 31, 2009, and who elect COBRA may be eligible to pay the 

reduced premium amount. Those who are eligible for other group health 

coverage (such as a spouse’s plan) or Medicare are not eligible for the 

premium reduction. There is no premium reduction for premiums paid for 

periods of coverage prior to February 17, 2009. 

Individuals involuntarily terminated from September 1, 2008 through 

February 16, 2009, who did not elect COBRA when it was first offered OR 

who did elect COBRA but are no longer enrolled (for example because 

they were unable to continue paying the premium) have a new election 

opportunity. This election period begins on February 17, 2009, and ends 

60 days after the plan provides the required notice. This special election 

period does not extend the period of COBRA continuation coverage beyond 

the original maximum period (generally 18 months from the employee’s 

involuntary termination). COBRA coverage elected in this special election 

period begins with the first period of coverage beginning on or after February 

17, 2009. 

Plan administrators must provide notice about the premium reduction to 

all individuals, whether they have COBRA coverage or not, who had a 

qualifying event from September 1, 2008 through December 31, 2009. In 

addition, individuals eligible for the special COBRA election period should 

have received a notice informing them of this opportunity by April 18, 2009. 

The model notices issued by DOL/EBSA can be found at www.dol.gov/

COBRA. 

The Department of Labor’s Employee Benefits Security Administration (DOL/EBSA) 

announced new guidance as featured below. You can subscribe to DOL/EBSA’s web 

site or PPA page for updates.

COBRA

11
Spring 2009 Retirement News for Employers

Individuals who are denied the premium reduction by their plan, employer 

or insurer may request an expedited review of the denial by the U.S. 

Department of Labor. DOL must make a determination within 15 business 

days of receipt of a completed request for review. DOL’s process will, 

in many situations, involve sharing the applicant’s information with the 

employer or plan administrator and requesting information from them 

regarding the applicant’s coverage under the health plan and the reason for 

the employee’s job loss.

DOL/EBSA has a dedicated COBRA web page. The archives of two 

webcasts held by DOL, joined by the Department of the Treasury and the 

IRS, are posted on this web page. Additional seminars and workshops 

around the country also are listed. Subscribe to DOL/EBSA’s COBRA 

page for notification of updates. 

Guidance on Defined Benefit Plan Annual Funding Notice

On February 10, DOL/EBSA issued Field Assistance Bulletin 2009-01

(FAB) addressing a need for interim guidance pending the adoption of 

regulations or other guidance under ERISA §101(f) by announcing a “good 

faith” enforcement policy. The FAB also includes technical assistance in 

the form of questions and answers and model annual funding notices.

The PPA amended ERISA to require plan administrators of defined benefit 

pension plans to provide participants and others with information annually 

about the funding status of their plans. 

Free Compliance Assistance Events

For dates and locations of free compliance assistance events sponsored 

by EBSA for both retirement and health benefit plans, visit EBSA’s

homepage. 

Notice of Approval to Extend Form 5500 Filing

The CP216F Notice, Application For Extension of Time to File 

an Employee Plan Return-Approved, acknowledges IRS approval of a 

plan sponsor’s request, on Form 5558, for an extension to file a Form 

5500 return. Any CP216F Notice issued between February through April 

2009, had an incorrect statement telling the filer to attach a copy of this 

notice to the Form 5500. We have corrected the CP216F Notice to delete 

this statement. It does not need to be attached to your Form 5500 and is 

for your records only. We will not assess penalties related to this notice.

12
Spring 2009 Retirement News for Employers

Retirement News for Employers

Retirement News for Employers is a free, 

quarterly newsletter aimed at keeping 

employers informed about retirement plan 

sponsorship. RNE is prepared by the IRS’s 

Employee Plans (Tax Exempt and 

Government Entities) office.

For your convenience, RNE includes Internet 

links – identified by the blue underlined text 

– to referenced materials.

How to Subscribe

RNE is distributed exclusively through IRS 

e-mail. Sign up for your free subscription by 

going to the Retirement Plans Community

web page and selecting “Newsletters” in the 

left pane. Prior editions of the RNE are also 

archived there.

Send Comments/Suggestions to:

EP Customer Education & Outreach

SE:T:EP:CEO

1111 Constitution Ave., N.W., PE-4C3

Washington, DC 20224

FAX: (202) 283-9525

E-Mail: RetirementPlanComments@irs.gov

Have a Question?

For taxpayer assistance with retirement plans 

technical and procedural questions:

Please call (877) 829-5500 or visit the 

“Contact EP/Services” section at 

www.irs.gov/ep.

For questions relating to retirement income, 

IRAs, Roth IRAs, educational IRAs, medical 

savings accounts, and §125 cafeteria plans: 

Please call (800) 829-1040.

Mark Your Calendar

Operating a retirement plan can be a time-consuming job. There are deadlines, not 

just for reports and forms but also for making contributions and giving information 

to participants. Here are some important dates in the upcoming months. Please 

note that the filing dates are for calendar-year end plans. Noncalendar-year end 

plans must adjust their dates.

June 24: EBSA Seminar: Getting It Right: Know Your Fiduciary Responsibilities 

– Chicago, IL. 

July 7 - 9: IRS Nationwide Tax Forum – Las Vegas, NV. 

July 9: EBSA Seminar: Getting It Right: Know Your Fiduciary Responsibilities 

– Atlanta, GA. 

July 14 - 16: IRS Nationwide Tax Forum – San Diego, CA. 

July 15: Second quarter defined benefit plan employer contribution due. 

July 31: “Form 5500 Day”– File with DOL/EBSA

2008 Form 5500, Annual Return/Report of Employee Benefit Plan, or

2008 Form 5500-EZ, Annual Return of One-Participant (Owners and 

Their Spouses) Retirement Plan, or

Form 5558, Application for Extension of Time to File Certain Employee 

Plan Returns, with IRS to request an automatic 2 1/2 -month extension 

(October 15, 2009). 

August 4 - 6: IRS Nationwide Tax Forum – Orlando, FL.

August 25 - 27: IRS Nationwide Tax Forum – New York, NY.

September 8 - 10: IRS Nationwide Tax Forum – Dallas, TX. 

September 24 - 26: IRS Nationwide Tax Forum – Atlanta, GA.

For a comprehensive list of upcoming EP Educational Events, visit the 

Retirement Plans Community web page.

 Department of the Treasury Publication 4278 (05-2009)

 Internal Revenue Service Catalog No. 37968D

 www.irs.gov

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Spring 2009 Retirement News for Employers

Timing is Everything

Some helpful retirement tips for employees from the IRS...

It’s not too late to plan for 2009. 

Have you received a raise? Did your child graduate from college? Did you graduate? 

Congratulations! Consider decreasing your taxable income and increasing your retirement 

savings...

• Many retirement plans have quarterly or semi-annual entry dates. If you are not already participating 

in your plan, consider joining on the next entry date.

• If you are already participating, consider increasing your deferrals. You may also want to consider 

contributing to a traditional or Roth IRA. For 2009 you can generally contribute up to: 

• IRA - $5,000

• SIMPLE plan - $11,500

• 401(k) or 403(b) plan - $16,500 

• If you turn 50 at any time during 2009, you may be eligible to make catch-up contributions. For 

2009, the maximum catch-up contribution is:

• IRA - $1,000

• SIMPLE plan - $2,500

• 401(k) or 403(b) plan - $5,500 

• Did you notice that you are receiving more in your paycheck? Use the IRS’s Withholding Calculator

or Publication 919 and review your Form W-4 to verify that you are having the proper amount of tax 

withheld.

For more retirement tips, talk to your employer or visit www.irs.gov/ep, select “Plan Participant/Employee” 

and click on “Timing is Everything.”

 Department of the Treasury Publication 4278-B (05-2009)

 Internal Revenue Service Catalog No. 47978D

 www.irs.gov

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