Internal Revenue Code ("Code") Section 457(b) plans are only available to a select group of employers – state and local governments and entities that are exempt from tax pursuant to Code Section 501. Earlier this month, the Internal Revenue Service (the "IRS") extended the deadline for SECURE Act and CARES Act amendments for governmental Code Section 457(b) plans. However, the IRS has not extended the deadline for such amendments for Code Section 457(b) plans sponsored by tax-exempt entities. Therefore, we recommend amending such plans by December 31, 2022 to include the applicable SECURE Act provisions. All distributions from the Plan will be required to comply with the updated minimum distribution requirements of Code Sections 457(b) and 401(a)(9) and regulations thereunder including the incidental death benefit requirements.

Although it is possible the IRS could still delay the deadline for amending non-governmental 457(b) plans, it is prudent for tax-exempt entities to amend their Code Section 457(b) plan by December 31, 2022 since the IRS has twice issued guidance which has been silent on extending the SECURE Act's amendment deadline for such plans (IRS Notice 2022-33 and IRS Notice 2022-45).