IRS Offers Sample Retirement Plan Notice

The Internal Revenue Service has issued a sample notice that 401(k) and 414(w) plan sponsors can use to tell plan participants about their rights and obligations under the Pension Protection Act’s eligible automatic contribution arrangements and qualified automatic contribution arrangements.

The sample notice is for a hypothetical qualified automatic contribution arrangement that permits eligible automatic contribution arrangement withdrawals. An employer will have to modify the sample notice to accommodate any differences in the specific retirement plan.

Separately, the IRS made changes in the instructions for Forms W-2, W-3 and 1099-MISC. For calendar year 2007, employers and payers do not have to report nonqualified deferred compensation amounts not includible in gross income under Section 409A in Box 12 of Form W-2 using code Y (or Box 15a of Form 1099-MISC). These and other changes can be found at http://www.irs.gov/formspubs/article/0,,id=109875,00.html.