2025 Retirement Plan Year-End Amendments and Operational Compliance
|
Headlines Compliance and Regulatory
Insight: Studies, Research, Analysis, or Papers
Items of Special Interest to Advisers or Other Service Providers 403b Plans Court and Legal
State-Based Private-Sector Retirement Programs Marketplace News Summaries Compliance and Regulatory 2025 Retirement Plan Year-End Amendments and Operational Compliance As the leaves change and the holidays approach, it's a perfect time for retirement plan sponsors to review their plans to ensure year-end compliance. Even though the deadline to adopt formal amendments for legislative changes under the SECURE Act, CARES Act, and SECURE 2.0 is generally not until December 31, 2026, there are still important steps to take now, including: Reviewing plan documents to identify needed updates or amendments; Confirming operational compliance with legal changes that are already in effect; and Providing required participant notices, including safe harbor notices and QDIA notices, before applicable deadlines. Source: Groom.com Retirement Plan Amendments: Are You Sure You Know Your Deadline? Under IRS Notice 2024-2, most retirement plan sponsors have until the end of 2026 or later to amend their plans to incorporate provisions from the CARES Act, Miners Act, Relief Act, SECURE Act, and SECURE 2.0. However, this extension does not apply to Section 457b plans maintained by tax-exempt organizations, which must be amended by December 31, 2025. Amendment deadlines vary depending on the type of retirement plan. Here's a list of the current amendment deadlines by plan type. Source: Spencerfane.com SECURE 2.0 Roth Deadline Tops Year-End Action Item List Plan sponsors always have a full plate, but 2025 brings heightened importance, according to Mike Webb of CAPTRUST. As the fourth quarter progresses, experts emphasize key year-end actions for maintaining retirement plan compliance and health. The top priority this year: deciding how to implement the mandatory Roth catch-up contribution rule under the SECURE 2.0 Act of 2022. Source: Plansponsor.com Each year, Americans invest billions of dollars into retirement accounts to prepare for their future. However, when it's time to access those funds, many participants are either unreachable or fail to cash the checks sent to them. This article outlines the responsibilities of plan sponsors in handling missing or unresponsive participants and explores alternative methods for managing the associated retirement plan assets. Source: Sidley.com Getting Into the Details of Roth Catch-Ups Starting in 2026, the Roth catch-up provision under the SECURE 2.0 Act will take effect on a "good faith" basis, introducing new complexities for retirement plan fiduciaries. As part of a broader shift toward "Rothification," this rule requires certain catch-up contributions to be made on a Roth basis -- without the upfront tax deduction of traditional contributions. Legal experts, including Jenny Kiesewetter of Fisher Phillips, emphasize that while the provision aims to raise revenue, it also presents hidden implementation challenges that plan sponsors must carefully navigate. Source: Psca.org The DOL recently issued Advisory Opinion 2025-04A, affirming that a lifetime income product may qualify as a Qualified Default Investment Alternative under ERISA. This decision reflects a broader movement by the DOL, Congress, and plan sponsors to incorporate features traditionally found in defined benefit pension plans into defined contribution 401k plans. Source: Willkie.com »» Click here for more Compliance and Regulatory Material Insight: Studies, Research, Analysis, or Papers Retirement Throughout the Ages: The American Middle Class "Retirement Throughout the Ages: The American Middle Class" is a joint report by the Transamerica Center for Retirement Studies and Transamerica Institute that examines the priorities, health, finances, and retirement outlook of middle-class Americans aged 18 and older. It compares different age groups -- 20s through 70s+ -- and offers insights into their work and caregiving experiences. The report also includes recommendations for individuals, employers, and policymakers, along with a curated reading list for further exploration. Source: Transamericainstitute.org Millennials Torn Between Homeownership and Saving for Retirement Millennials are facing a tough financial dilemma due to stabilized yet high housing prices. Many feel forced to choose between buying a home and saving for retirement. A study by Nationwide Retirement Institute reveals that 58% believe they can't do both. Rising housing costs are seen as major obstacles to retirement savings, with 35% calling them the biggest hurdle and 46% viewing mortgages and home equity loans as the greatest threat to a secure retirement. Since early 2025, 60% have adjusted their retirement plans in response to these financial pressures, leading to growing frustration over the lack of affordability and difficulty in building wealth through property ownership. Source: 401kspecialistmag.com DC Plan Innovation and RLP: Opinion Securian Financial and Custodia Financial have formed a strategic partnership to offer Custodia's Retirement Loan Protection (RLP) program. This innovative feature protects 401k loans from default in cases of job loss, disability, or death. While insurance-based products like RLP often face skepticism due to perceptions of consumer exploitation, the release highlights that meaningful innovation still exists in the insurance sector and can benefit consumers. Source: Businessofbenefits.com »» Click here for More Studies, Research, and White Papers Items of Special Interest to Advisers or Other Service Providers Roth Compliance Tops Advisers' Q4 To-Do List In 2025, retirement plan advisers face especially important responsibilities, with the fourth quarter bringing critical compliance tasks. The most significant issue is addressing the mandatory Roth catch-up contribution requirement introduced by the SECURE 2.0 Act of 2022, which affects plan health and participant readiness. Source: Planadviser.com 403b Plans Mandatory Roth 403b Catch-Up Contributions Under the SECURE 2.0 Act The SECURE 2.0 Act of 2022 introduced various measures aimed at expanding Roth treatment options within retirement plans, including a requirement that catch-up contributions made by high-wage employees be treated as Roth contributions. With final IRS regulations issued in September 2025, many implementation uncertainties have been clarified. Despite this guidance, retirement plan sponsors continue to face complexity in navigating the rules and must evaluate key decision points to ensure compliance. Key decision points for plan sponsors are reviewed in this article. Source: Ipbtax.com »» Click here for More 403b Material Court and Legal Viewing ESG amd ERISA Through a Political Lens: Does the American Airlines Relief Make Sense? Taking the two American Airlines decisions together, the result is that even though American Airlines followed a prudent investment selection process and there were no monetary damages to award because no losses could be tied to American's decisions, the court injected itself into running the plans permanently and ordered that annual disclosures not required by ERISA be given to all participants. The decision also prohibits proxy voting to support ESG-related measures. Source: Cohenbuckmann.com Caesars Fiduciaries Hit Jackpot Due to Prudent Processes The prudent appointment and oversight of Russell Investments Trust Company as an ERISA section 3(38) investment manager by the Caesars Entertainment Corporation 401k Plan Committee highlights the value of well-documented fiduciary practices. This decision not only benefited the Committee and plan sponsor but also demonstrated how sound processes can help fiduciaries avoid prolonged litigation, even in an environment where lawsuits are common despite no evidence of wrongdoing. Source: Erisalitigation.com Cornell 403b Plan Lawsuit Returns to District Court The case Cunningham v. Cornell University, a prominent retirement industry lawsuit, is returning to the U.S. District Court for the Southern District of New York after the Supreme Court ruled in favor of the plaintiffs. The 2nd Circuit Court of Appeals remanded the case due to the parties' inability to agree on next steps. The district judge will now determine whether to proceed with summary judgment motions, reopen discovery, or offer the plaintiffs a jury trial. Source: Planadviser.com Suit Says Plan Sponsor "Uncritically Relied" on Advisor TDF Choice A lawsuit has been filed against the fiduciaries and advisor of the Elanco US, Inc. 401k Plan, alleging they breached their fiduciary duties by continuing to invest in an underperforming target-date fund. The plaintiffs, acting on behalf of plan participants and beneficiaries, claim that the decision to retain the American Century TDFs was imprudent given the information available to the Plan Committee. The case is being heard in the U.S. District Court for the Southern District of Indiana. Source: Napa-net.org »» Click here for more Court and Other Legal Issues State-Based Private-Sector Retirement Programs Resources for Tracking State and Local Retirement Initiatives This article provides an overview of state-level retirement programs designed for private-sector employees. It also includes a collection of related resources from Mercer and other third-party sources. Please note that this list is updated periodically and may not always reflect the most recent changes in every state. Source: Mercer.com »» Click here for more on Legislative and Washington Actions Marketplace News Securian Financial Joins Forces with Custodia Financial for Retirement Loan Protection Program Edward Jones Expands Workplace DC Plan Capabilities 401k Annuity Hub Aimed at Lifetime Income in DC Plans
This eNewsletter is a digest of information published by a variety of web-based sources on 401k and related issues and is published as a service to our users. 401khelpcenter.com, LLC is not the author of the material unless specifically noted. Articles are copyrighted to their publishers. If you believe that your work has been copied in a way that constitutes copyright infringement, please contact the source site immediately. Hyperlinks in this document are provided as a convenience and we disclaim any responsibility for information, services, or products found on websites linked hereto. All links were tested before this eNewsletter was e-mailed to you to ensure that they are still functional, but publishers do move or delete articles. Therefore, we can't guarantee that the links provided will remain operational. 401khelpcenter.com does not endorse, approve, certify, or control this material and does not guarantee or assume responsibility for the accuracy, completeness, efficacy, or timeliness of the material. Use of any information obtained from this material is voluntary, and reliance on it should only be undertaken after an independent review of its accuracy, completeness, efficacy, and timeliness. Reference to any specific commercial product, process, or service by trade name, trademark, service mark, manufacturer, or otherwise does not constitute or imply endorsement, recommendation, or favoring by 401khelpcenter.com. Opinions expressed are those of the author of the article and do not necessarily reflect the positions of 401khelpcenter.com. THIS NEWSLETTER IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE INVESTMENT, TAX, ACCOUNTING, OR LEGAL ADVICE. Copyright © 2025 by 401khelpcenter.com, LLC. All rights reserved. No reproductions without prior authorization, but you are free to email this copy (in its entirety) along to colleagues or clients. This newsletter may not be posted on any website. 401khelpcenter.com, LLC
|
