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Notice 2009-86 announces the intent to further extend the final effective date of the final regulations under Section 401(a) relating to distributions from a pension plan upon attainment of Normal Retirement Age for governmental plans, as described in Section 414(d). In Notice 2008-98, the effective date for governmental plans was extended to plan years beginning on or after January 1, 2011. Taking into account this extension, the NRA regulations will be effective for a governmental plan for plan years beginning on or after January 1, 2013. This notice does not change the effective date of the NRA regulations for a plan that is not a governmental plan or modify the relief previously provided in Notice 2007-69.
Part III. Administrative, Procedural, and Miscellaneous Further Extension of pension plan to commence payment of re- tion of a stated number of years of service Effective Date of Normal tirement benefits to a participant after the typically will not satisfy the vesting or Retirement Age Regulations participant has attained normal retirement accrual rules of § 411. The notice asked age even if the participant has not yet had for comments from sponsors of plans for Governmental Plans a severance from employment with the that are not subject to the requirements employer maintaining the plan. of § 411, such as governmental plans, on Notice 2009–86 The NRA regulations require a pension whether such a plan may define normal plan’s normal retirement age to be an age retirement age based on years of service. I. Purpose that is not earlier than the earliest age that Specifically, comments were requested on The Service and Treasury intend to is reasonably representative of the typical whether and how a pension plan with a extend the time by which a governmental retirement age for the industry in which normal retirement age conditioned on the plan must comply with final regulations the covered workforce is employed. The completion of a stated number of years on distributions from a pension plan upon NRA regulations provide that a normal re- of service satisfies the requirement in attainment of normal retirement age (“the tirement age of 62 or later (or age 50 or § 1.401(a)–1(b)(1)(i) that a pension plan NRA regulations”) beyond the date pre- later, in the case of a plan in which sub- be maintained primarily to provide for viously announced in Notice 2008–98, stantially all of the participants are qual- the payment of definitely determinable 2008–2 C.B. 1080. These regulations ified public safety employees (within the benefits after retirement or attainment of were published in the Federal Register meaning of § 72(t)(10)(B))) is deemed to normal retirement age and how such a as T.D. 9325, 2007–1 C.B. 1386 (72 FR satisfy this requirement, and a normal re- plan satisfies the pre-ERISA vesting rules. 28604) on May 22, 2007. Taking into tirement age lower than 55 is presumed not A number of comments were received account this extension, the NRA regula- to satisfy the requirement unless the Com- in response to Notice 2007–69, includ- tions will be effective for a governmental missioner determines otherwise on the ba- ing comments relating to the effect of the plan (as defined in § 414(d) of the Internal sis of facts and circumstances. Whether a NRA regulations on governmental plans. Revenue Code) for plan years beginning normal retirement age that is at least 55 but In Notice 2008–98, the Service and on or after January 1, 2013. This notice below 62 satisfies the requirement is based Treasury announced their intention to does not change the effective date of the on facts and circumstances. amend the NRA regulations to change the NRA regulations for a plan that is not a The NRA regulations were generally effective date for governmental plans to governmental plan or modify the relief effective May 22, 2007, with a later ef- plan years beginning on or after January previously provided in Notice 2007–69, fective date for governmental plans and 1, 2011. 2007–2 C.B. 468. certain collectively bargained plans. For governmental plans, the NRA regulations III. Further Extension of Effective Date II. Background were originally effective for plan years be- of NRA Regulations for Governmental ginning on or after January 1, 2009. Plans Section 411(a)(8) provides that the term Notice 2007–69 provided temporary “normal retirement age” means the ear- relief for certain plans that may have had The Service and Treasury intend to lier of (A) the time a plan participant at- to change their definition of normal retire- amend the NRA regulations to change tains normal retirement age under the plan ment age to satisfy the NRA regulations. the effective date for governmental plans or (B) the later of age 65 or the fifth an- The relief was available to certain plans to plan years beginning on or after niversary of the time a plan participant that might otherwise have been required
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