Tom Schendt was quoted in a BNA Daily Tax Report article discussing the new draft revenue procedure for tax code Section 403(b) prototype plans. “Practitioners will have to step up their game,” Schendt said. The new procedure is a departure from the previous practice of operating Section 403(b) plans without reference to a formal plan document, according the Schendt, and “there will be more operational errors, no doubt about it.”
In the article, Schendt foresaw growing pains similar to those experienced when IRS introduced a prototype program for 401(k) plans. “In a sense this is déjà vu all over again.” He did point out that IRS did a good job of timing the draft procedure well in advance of the December 31 deadline for employers to adopt a 403(b) written plan document: “It’s good to see it out now as opposed to summer.”
