The Clock Is Ticking: Retirement Plan Amendment Deadline Is Quickly Approaching

Time is running out. Plan sponsors of qualified retirement plans must adopt formal amendments by December 31, 2026, to bring their plans into compliance with certain legislative changes.

Background

In recent years, Congress enacted a series of reforms to qualified plan rules: the Coronavirus Aid, Relief, and Economic Security Act (CARES Act); the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act); and the SECURE 2.0 Act (enacted December 2022). These three major legislative acts provided for both optional and mandatory provisions, including, but not limited to:

• CARES Act - Provided temporary coronavirus-related distribution relief, waived required minimum distributions (RMDs) for 2020, and expanded plan loan limits for qualifying individuals affected by COVID-19.
• SECURE Act - Extended the required beginning date for RMDs, expanded eligibility for long-term part-time employees, increased the cap on automatic enrollment escalation, and introduced new optional in-service distribution provisions, including qualified birth or adoption withdrawals, among other significant changes to plan design.
• SECURE 2.0 Act - Further delayed the required beginning date for RMDs, and created new optional in-service distribution provisions, including domestic violence victim withdrawals, emergency expense withdrawals, disaster withdrawals, and terminal illness withdrawals, as well as other new optional plan features such as emergency savings accounts and student loan matching contributions. The SECURE 2.0 Act also expanded Roth contribution options and introduced enhanced catch-up contribution rules, among many other changes.

Most qualified retirement plans, including 401(k), 403(b), and defined benefit plans, must be amended to reflect applicable mandatory and optional provisions of all three laws by December 31, 2026. 401(k) plans are most affected. The Internal Revenue Service (IRS) initially provided an extended period of time between the date the reforms were enacted and the deadline for qualified plans to be amended; however, unless the IRS acts soon to provide a further extension, the December 31, 2026, deadline will stand.

Certain plans are subject to later deadlines, including union plans (December 31, 2028), governmental plans (December 31, 2029), and 403(b) plans maintained by public schools (December 31, 2029). For more information on plans not subject to the December 31, 2026, deadline, please see our previous First Alert.

Action Items for Plan Sponsors

With less than six months remaining, plan sponsors should take the following steps:

• Identify which provisions apply to your qualified plans. Not every provision is mandatory, meaning that as plan sponsor, you may have already chosen to adopt one or more of the optional provisions. In addition, not every mandatory provision applies to all types of qualified plans. Confirm with your benefits counsel which changes to your qualified retirement plan require a plan amendment by the end of the year.
• Contact your plan vendor and legal counsel, as necessary. Whether your qualified plan is a preapproved plan or an individually designed plan, you will need to contact legal counsel. For preapproved plans, the vendor will be primarily responsible for the amendments; however, legal counsel can help review the amendment language to assist you in making sure it reflects your intentions. For individually designed plans, legal counsel can assist in drafting the required amendments.
• Obtain board or plan committee approval. Amendments to qualified plans typically require formal authorization from the plan sponsor's board of directors, plan committee, or other governing body.
• Coordinate with other plan documents. Amendments must align with the plan's summary plan description (SPD), other plan participant communications, and any related administrative documents.

Contact Us

Calfee's Employee Benefits and Executive Compensation team is actively working with plan sponsors to navigate the December 31, 2026, amendment deadline. Calfee can assist with:

• reviewing plan documents and identifying required amendments to reflect both mandatory changes and those optional changes you already chose to adopt,
• providing guidance on whether to adopt optional provisions,
• drafting or reviewing plan amendments and coordinating with your plan's vendor, as necessary, and
• preparing and updating summary plan descriptions, summary of material modifications, participant communications, and plan administration documents/forms.

For additional information on this topic, please contact your regular Calfee attorney or the author(s) listed below.

Calfee's nationally recognized Employee Benefits and Executive Compensation practice group advises business and governmental clients on managing their most challenging legal and business issues related to benefits and compensation. In addition to extensive experience with tax-qualified retirement and employee health and welfare benefit plans, the group's practice also has a significant focus on the design and implementation of sophisticated executive compensation programs, ESOPs, merger and acquisition matters, and ERISA litigation. Our employee benefits attorneys are experienced in all types of benefit plans, including defined benefit pension plans, 401(k) plans, ESOPs, executive compensation arrangements, welfare plans, Voluntary Employees' Beneficiary Associations (VEBAs), governmental plans, church plans, 403(b) plans and 457(b) plans. Areas of recent growth include forming ESOPs and pooled employer plans and negotiating pharmacy benefit management contracts.

Calfee, Halter & Griswold LLP is a full-service corporate law firm with 160 attorneys and professionals in Cleveland, Columbus, Cincinnati, and Indianapolis. Calfee serves clients in the Midwest, nationally and globally in the areas of Corporate and Finance, Employee Benefits and Executive Compensation, Energy and Utilities, Estate and Succession Planning and Administration, Government Relations and Legislation, Intellectual Property, Labor and Employment, Litigation, and Real Estate Law. Calfee has been recognized as a leading law firm by Chambers USA 2026 in Antitrust, Banking & Finance, Construction, Corporate/M&A, Employee Benefits & Executive Compensation, Energy & Natural Resources, Environment, Government Relations, Insurance, Intellectual Property, Labor & Employment, Litigation: General Commercial, Litigation: White-Collar Crime & Government Investigations, Public Finance, and Real Estate, and by Chambers HNW 2025 in Private Wealth Law. A founding member of Lex Mundi, Calfee offers international representation through a network of independent law firms with access to 22,000 attorneys located in more than 125 countries. Additional information is available at Calfee.com.