IRS Extends 409A Compliance Deadline Again

IRS Notice 2007-86, released October 22, 2007, responds to employer pleas by extending Code Section 409A transition relief for an additional year, to December 31, 2008. The key provisions of the Notice include:

• Employers have until December 31, 2008 to amend plan documents to conform to the provisions of Section 409A and the final 409A regulations;

• Plans are not required to designate 409A-compliant times and forms of payment before the end of 2007;

• Employers have until January 1, 2009 to comply with the final 409A regulations;

• Plan operations through December 31, 2008 must comply with a reasonable, good faith interpretation of Section 409A, but after December 31, 2007, they cannot rely on the proposed 409A regulations;