October 31, 2017
On Oct. 13, 2017, the IRS released the October edition of Employee Plans News . Although this edition focuses primarily on defined benefits plan guidance, it also includes IRS Chief Counsel Advice Memorandum 201736022, which provides guidance on cure periods for participant loans. As background, IRS regulations require that participant loans feature level amortization of loan repayments over the term of the loan. Participants who miss a payment (because of a leave of absence, for example) are allowed a cure period during which they can repay any missed payments. The memorandum gives two examples on determining the cure period for missed installment loan payments.
The IRS also includes updated Forms 4972 (Tax on Lump-Sum Distributions) and Form 8881 (Credit for Small Employer Pension Plan Startup Costs).
Employers should familiarize themselves with this guidance.
Employee Plans News October 2017 Issue »