By Stacey L. Stewart, Esq.
McKenna Long & Aldridge LLP, Atlanta, GA
The IRS has provided much needed guidance on how to apply the requirement to recognize same-sex spouses for qualified retirement plan purposes. This requirement stems from the U.S. Supreme Court's Windsor ruling which struck down the portion of the Defense of Marriage Act (DOMA) that provided that only opposite sex marriages would be recognized for federal law purposes. Notice 2014-19, along with related (FAQs), now resolve confusion about retroactive application of the requirement and amendment of plans to reflect the new rules. This alert highlights the key points in the new guidance for plan sponsors.
Regardless of whether your plan needs to be amended, you should clarify administrative procedures according to a timeline that shows how your plan handled same-sex spouses before and after the Windsor ruling. The timeline should specifically address the period between June 26, 2013 (the date of the Windsor ruling) and September 16, 2013 (the effective date for the IRS recognition).
An amendment is only required if your plan defines "spouse" by reference to DOMA, otherwise specifies that a spouse is an individual of the opposite-sex, or contains provisions that are inconsistent with the Windsor ruling. However, to avoid confusion and document your compliance with the rules, you may want to amend your plan to set forth how you have and will apply the same-sex spouse rules in accordance with the above timeline.
Your deadline to adopt any required amendment is December 31, 2014, for most single-employer plans other than 403(b) plans. The deadline for 403(b) plans is unknown, but will likely not be before the end of 2015.
For more information, in the Tax Management Portfolios, see Finston and Jewett, 351 T.M., Plan Qualification - Pension and Profit Sharing Plans, Bosley and Hutzelman, 370 T.M., Qualified Plans - Taxation and Distributions, and in Tax Practice Series, see ¶5540, Obtaining IRS Approval for Qualified Plans, ¶5520, Plan Qualification Requirements.
© 2014 McKenna Long & Aldridge LLP
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