Sec. 410. Multiple employer 403(b) plans
1,004 words·~5 min read·
/bill/119/hr/185/ih/section-410A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Section 403(b) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: Except in the case of a church plan, this subsection shall not be treated as failing to apply to an annuity contract solely by reason of such contract being purchased under a plan maintained by more than 1 employer. In the case of a plan maintained by more than 1 employer, this subsection shall not be treated as failing to apply to an annuity contract held under such plan merely because of one or more employers failing to meet the requirements of this subsection if such plan satisfies rules similar to the rules of section 413(e)(2) with respect to any such employer failure.
A plan shall not be treated as meeting the requirements of this subparagraph unless the plan satisfies rules similar to the rules of subparagraph
(A)or
(B)of section 413(e)(1), except in the case of a multiple employer plan maintained solely by any of the following: A State, a political subdivision of a State, or an agency or instrumentality of any one or more of the foregoing. . b ) multiple employer plan Section 6057 of such Code is amended by redesignating subsection
(g)as subsection
(h)and by inserting after subsection
(f)the following new subsection: b ) multiple employer plans treated as one plan In the case of annuity contracts to which this section applies and to which section 403(b) applies by reason of the plan under which such contracts are purchased meeting the requirements of paragraph
(15)thereof, such plan shall be treated as a single plan for purposes of this section. . b ) multiple employer plan Section 6058 of such Code is amended by redesignating subsection
(f)as subsection
(g)and by inserting after subsection
(e)the following new subsection: b ) multiple employer plans treated as one plan In the case of annuity contracts to which this section applies and to which section 403(b) applies by reason of the plan under which such contracts are purchased meeting the requirements of paragraph
(15)thereof, such plan shall be treated as a single plan for purposes of this section. . Section 3(43)(A) of the Employee Retirement Income Security Act of 1974 is amended— in clause (ii), by striking section 501(a) of such Code or and inserting section 501(a) of such Code, a plan that consists of contracts described in section 403(b) of such Code, or ; and in the flush text at the end, by striking the plan. and inserting the plan, but such term shall include any program (other than a governmental plan) maintained for the benefit of the employees of more than 1 employer that consists of contracts described in section 403(b) of such Code and that meets the requirements of subparagraph
(A)or
(B)of section 413(e)(1) of such Code. . Sections 3(43)(B)(v)(II) and 3(44)(A)(i)(I) of the Employee Retirement Income Security Act of 1974 are each amended by striking section 401(a) of such Code or and inserting section 401(a) of such Code, a plan that consists of contracts described in section 403(b) of such Code, or . The Secretary of the Treasury (or the Secretary’s delegate) shall prescribe such regulations as may be necessary to clarify, in the case of plans to which section 403(b)(15) of the Internal Revenue Code of 1986 applies, the treatment of an employer departing such plan in connection with such employer’s failure to meet multiple employer plan requirements. The Secretary of the Treasury (or the Secretary’s delegate) shall modify the model plan language published under section 413(e)(5) of the Internal Revenue Code of 1986 to include language that notifies participating employers described in section 501(c)(3), and which are exempt from tax under section 501(a), that the plan is subject to the Employee Retirement Income Security Act of 1974 and that such employer is a plan sponsor with respect to its employees participating in the multiple employer plan and, as such, has certain fiduciary duties with respect to the plan and to its employees. For plans to which section 403(b)(15)(A) of the Internal Revenue Code of 1986 applies (other than a plan maintained for its employees by a State, a political subdivision of a State, or an agency or instrumentality of any one or more of the foregoing), the Secretary of the Treasury shall publish model plan language similar to model plan language published under section 413(e)(5) of such Code. The Secretary of the Treasury (or the Secretary’s delegate) shall provide education and outreach to increase awareness to employers described in section 501(c)(3) of the Internal Revenue Code of 1986, and which are exempt from tax under section 501(a) of such Code, that multiple employer plans are subject to the Employee Retirement Income Security Act of 1974 and that such employer is a plan sponsor with respect to its employees participating in the multiple employer plan and, as such, has certain fiduciary duties with respect to the plan and to its employees. Regarding any application of section 403(b) of the Internal Revenue Code of 1986 to an annuity contract purchased under a church plan (as defined in section 414(e) of such Code) maintained by more than 1 employer, or to any application of rules similar to section 413(e) of such Code to such a plan, no inference shall be made from section 403(b)(15)(A) of such Code (as added by this Act) not applying to such plans. The amendments made by this section shall apply to plan years beginning after December 31, 2024. Nothing in the amendments made by subsection
(a)shall be construed as limiting the authority of the Secretary of the Treasury or the Secretary’s delegate (determined without regard to such amendment) to provide for the proper treatment of a failure to meet any requirement applicable under the Internal Revenue Code of 1986 with respect to one employer (and its employees) in the case of a plan to which section 403(b)(15) of the Internal Revenue Code of 1986 applies.