The Treasury and the Internal Revenue Service have issued guidance for certain retirement plan administrators, updating safe harbor explanations to reflect tax law changes made after Aug. 6, 2020.
The first safe harbor explanation applies to non-Roth accounts, and the second applies to Roth accounts. The notice also addresses, among other things, changes to the 10% additional tax on early withdrawals, required minimum distribution rules for surviving spouses, and the increased age for required beginning dates for RMDs.
Plan administrators may customize these safe harbor explanations as appropriate. For instance, if the plan does not hold after-tax employee contributions, the administrator could eliminate that section of the safe harbor explanation.
The guidance modifies the safe harbor explanations previously contained in Notice 2020-62.
