• Client Portal
|
  • Subscribe to Newsletter
  • Request for Proposal
Legacy Retirement Solutions - Third Party Retirement Plan Administration
  • Home
  • About Us
  • Services
  • Articles
  • Resources
  • Contact Us
  • Careers
Legacy Retirement Solutions - Third Party Retirement Plan Administration
  • Home
  • About Us
  • Services
  • Articles
  • Resources
  • Contact Us
  • Careers
  • Home
  • Statutory / Regulatory
  • Delay to Deadline for Plan Sponsors to Make Retirement Plan Contributions

Categories

  • Administration
  • Plan Design
  • Statutory / Regulatory

  • Statutory / Regulatory

Delay to Deadline for Plan Sponsors to Make Retirement Plan Contributions

  • Posted on March 31, 2020 by Legacy Retirement Solutions

The fanfare and excitement over the recent enactment of the Coronavirus Aid, Relief and Economic Security Act of 2020 (“CARES”) Act may have caused some plan sponsors to miss another very important piece of tax-qualified retirement plan related relief.  IRS Notice 2020-18 (“Notice 20-18”) was released on March 20, 2020 and, on March 24, 2020, the IRS issued certain “frequently asked questions” (“FAQs”) about Notice 20-18.

Notice 20-18 indicated that all federal income tax returns and tax payments that would have otherwise become due on April 15, 2020 are automatically postponed until July 15, 2020.  The delay of this specific deadline is significant to the tax-qualified retirement plan industry.  This is because, as you probably already know, the deadline for making certain contributions to a tax-qualified retirement plan under section 404(a)(6) of the Internal Revenue Code in connection with a particular tax year generally is the deadline for the plan sponsor to file its tax return for that time period.  Thus, the guidance offered under Notice 20-18 inspired questions as to whether the postponed tax filing deadline also impacted the plan contribution deadline.

Although not directly addressed within Notice 2018, the FAQs specifically stated that:

Q: For employers with a federal income tax return due date of April 15, 2020, is the end of the grace period under section 404(a)(6) to make contributions to their qualified retirement plans              on account of 2019 also July 15, 2020 as a result of this relief?

A: Yes, because … [Taxpayers] … for whom the due date for filing Federal income tax returns and making Federal income tax payments that would be due April 15, 2020, is now July 15,                      2020, the end of the grace period for those employers is also July 15, 2020 under this relief.  So, for example, if an employer is a corporation with an April 15, 2020 due date for filing the                    Form 1120, then the grace period under section 404(a)(6) for the employer to make contributions to its workplace-based retirement plan that are treated as made on account of 2019 ends on            July 15, 2020.

Thus, Notice 2020-18 and the FAQs authorize a plan sponsor for whom the 2019 retirement plan contribution deadline was April 15, 2020 to postpone the contribution deadline until July 15, 2020.  However, please be aware that, in application, this relief is available only with regard to certain forms of employer contributions since employee deferrals are subject to a different contribution timeframe.

Finally, the relief considered above is different than the defined benefit pension plan funding relief granted under the CARES Act.  For a discussion of that and other relevant provisions of the CARES Act, please refer to our separate Legislative Update being released concurrently with this article which specifically addresses retirement plan provisions of the CARES Act.

We hope that this article helped you to better understand this topic.  However, please be advised that it is not intended to serve as financial, tax or legal advice so it should not be construed as such.  If you have questions about this topic, we strongly urge you to further discuss it with a qualified retirement plan professional.  For more information about this topic, please contact our marketing department at 484-483-1044 or your administrator at Legacy.

Prev
Tax Credit for Small Employer Start-Up Plans
CARES Act – Retirement Plan Impact
Next

Recent Administrative Posts

  • ADP Test Basics Corrections
  • ADP Test Basics
  • Form 5500

Recent Plan Design Posts

  • Safe Harbor 401(k) Establishment Deadline
  • Safe Harbor 401(k) Establishment Deadlines
  • The Power of Combining Plans

Recent Statutory / Regulatory Posts

  • Tax Credit For Small Employer Start-Up Plans
  • ADP Test Basics Corrections
  • ADP Test Basics

Archived Articles A-Z

  • A-E
  • F-J
  • K-O
  • P-T
  • U-Y
  • Z-Z

A-E

  • Defined Benefit Plan Year Compliance Package
  • Delay to Deadline for Plan Sponsors to Make Retirement Plan Contributions
  • Department of Labor Releases New Guidance on Missing Participants
  • CARES Act – Retirement Plan Impact
  • Cashing-Out Terminated Employees From Your Company’s Retirement Plan
  • ADP Test Basics
  • ADP Test Basics
  • ADP Test Basics
  • ADP Test Basics
  • ADP Test Basics Corrections
  • ADP Test Corrections
  • Changes to DOL Late Deferral Remittance Enforcement Procedure
  • Changes to 404a-5 Participan Fee Disclosure Requires Additional Notifications
  • Congress Enacts Changes to Hardship Withdrawal Rules
  • Consequences of Failing to Timely Adopt a PPA Restatement
  • Employing the Proper Definition of Compensation
  • Correcting Average Deferral Percentage Test Failures
  • Correcting Average Deferral Percentage Test Failures
  • Are Your SEP Plans Safe From Other Financial Advisors?
  • Are You Ready For Your Next Plan year end?
  • ERISA Bond: What Is It and Do I Need ONe?
  • ERISA Bond: What Is It and Do I Need One?
  • A Plan Administrator’s “Due Diligence” Obligations
  • A Plan for Retirement Plan Compliance 2014
Back to top

F-J

  • Important CARES Act 2020 RMD Rollover Deadline Fast Approaching
  • Form 5500
  • Form 5500 Update
  • Form 5500 Update
  • IRS Creates Permanent Form 5500 Penalty Relief Program for Non-ERISA Plans
  • IRS Expands Retirement Plan Sponsors’ Self-Correction Options
  • IRS Expands Use of Pre-Approved Plan Documents To Cash Balance Plans
  • IRS Grants Form 5500 Penalty Relief for Non-ERISA Plans
  • IRS Grants 401(k) Safe Harbor Suspension Relief
  • IRS Issues Final Regulations on Mid-Year Reduction or Suspension of Safe Harbor Contributions
  • IRS Issues Guidance on Same Sex Marriage
  • IRS Issues Guidance Regarding Uncashed Check
  • IRS Revisits Mid-Plan Year Changes to Safe Harbor 401(k) Plans
  • IRS Provides Guidance on Expansion of In-Plan Roth Rollovers
Back to top

K-O

  • Legacy Solo(k) Plans 2016
  • NAPA Conference
  • New Opportunity In-Plan Roth Conversions
  • Limitations On Mid-Plan Year Amendments To Safe Harbor 401(k) Plans
Back to top

P-T

  • Safe Harbor 401(k) Establishment Deadline
  • Safe Harbor 401(k) Establishment Deadlines
  • Required Minimum Distributions
  • Required Minimum Distributions
  • Required Minimum Distributions
  • Tax Credit for Small Employer Start-Up Plans
  • Tax Credit For Small Employer Start-Up Plans
  • Tax Credit for Small Employer Start-Up Plans
  • Tax Credit For Small Employer Start-Up Plans
  • The SECURE Act – Plan Sponsor Impact – Part 1
  • The SECURE Act – Plan Sponsor Impact – Part 2
  • The SECURE Act – Plan Sponsor Impact – Part 3
  • The Power of Combining Plans
  • The Problem with Using Forfeitures to Satisfy Employer Contributions
  • Plan Sponsors Must Retain Hardship and Loan Documentation
  • Plan Year Compliance Package
  • Plan Year Compliance Packages
  • Solo 401(k) Brochure
  • Treasury Issues Proposed Hardship Withdrawal Regulations
Back to top

U-Y

  • What are “Cash Balance Plans”?
  • What is “New Comparability”?
Back to top

 

 

 

 

Phone: 484-483-1044     E-mail: marketing@legacyrsllc.com     Address: 700 Turner Industrial Way, Suite 110, Aston, PA 19014     Follow Us: LinkedIn

© Copyright 2019 Legacy Retirement Solutions - All Rights Reserved - Design by CrafTech Computer Solutions

 

Links

  • Overview
  • Principals
  • Staff