Administrative relief is available for sponsors of defined contribution plans, such as section 401(k) plans, that were declared Presidential Disaster Areas during the month of May, announced the Internal Revenue Service (IRS).
According to the IRS, Notice 2010-48 extends the deadline for restating affected pre-approved defined contribution plans, as well as for submitting determination letters, from April 30 to July 30, 2010. In addition, the section 401(b) remedial amendment period for these retirement plans has also been extended.
The notice defines the conditions a plan must meet to qualify as an affected plan. For a plan to be affected, one of the locations relating to the plan, listed below, must have been in one of the federally declared disaster areas at the time of the disasters:
- The principal place of business of the employer that maintains the plan;
- The principal place of business of the employer that employs more than 50 percent of the active participants covered by the plan;
- The office of the plan or the plan administrator;
- The office of the primary record keeper serving the plan; or
- The office of any advisor that had been retained by the plan or the employer at the time of the severe weather that is directly involved with the adoption of the plan or the submission of a determination letter application to the IRS.
This relief applies to the following disaster situations:
- Connecticut: severe storms and flooding during March 2010 .
- Tennessee: severe storms and flooding during April-May 2010 .
- Alabama: severe storms and flooding during April 2010 .
- Mississippi: severe storms, tornadoes and flooding during April 2010 .
- New Jersey: storms and flooding during March 2010 .
- Massachusetts: storms and flooding during March .
- Rhode Island: storms and flooding during March.
- West Virginia: storms and flooding during March.