Most tax-advantaged retirement plans have at least until the end of 2026 to adopt amendments required by the legislation known as SECURE and SECURE 2.0. However, tax exempt organizations are different when it comes to 457(b) plans. This is because such plans were neglected and excluded from the IRS Notice that extended the amendment deadline for other plans and governmental sponsors of 457(b) plans from the end of 2025 to the end of 2026. When the age to begin Required Minimum Distributions (RMDs) was raised from 70 1/2 to 72 under the SECURE legislation, most retirement plans had to be amended by the end of 2022. However, the IRS extended the deadlines to the end of 2025 for most plans pursuant to IRS Notices. These extensions did not apply to tax exempt organization’s sponsoring 457(b) plans (Tax Exempt 457(b) Plans). See, Tax Exempt Organizations Must Amend 457(b) Plans By December 31 For Increased RMD Age. The legislation known as SECURE 2.0 extended the RMD age again and conformed the prior deadline for amendments with the deadline for most SECURE 2.0 provisions to the end of 2025. This included extending the deadline for Tax Exempt 457(b) Plans. See, SECURE 2.0 Changes Specific to Plans of Tax-Exempt Organizations. However, in late 2023, the IRS issued Notice 2024-02 which extended the deadline to the end of 2026 for most plans. See, Notice 2024-02 Extends Deadline For SECURE 2.0 Amendments And Provides Other Guidance. Unfortunately, once again Tax Exempt 457(b) Plans were left out, meaning the end of 2025 deadline still applies.

Thus, Tax Exempt 457(b) Plans must be amended by the end of this year for the new RMD ages and it doesn’t appear there will be any further extensions. If your Tax Exempt 457(b) Plan needs amending, please contact us.