409a Document Compliance Deadline Extended

The Department of Treasury and the Internal Revenue Service have extended the deadline by which plan documents are to be in documentary compliance with section 409A and provided other guidance in Notice 2007-78. Although the documentary deadline extension is welcome, employers must still act before the end of 2007 if they wish to take advantage of the transition relief available this year and to have a compliant time and form of payment specified in writing.

The Notice provides the following:

• Documentary Deadline – The Notice provides that a plan document needs to be in compliance with section 409A by December 31, 2008 (rather than by December 31, 2007).To the extent the plan is amended in 2008, the amendment must be retroactive to January 1, 2008, and the amendment must accurately reflect the operation of the plan through January 1, 2008.