Employers Need To Update Their Model IRS Rollover Notices After IRS Changes

The IRS has updated its "safe harbor explanations" for eligible rollover distributions to reflect recent statutory changes and IRS guidance. Employers should review this latest guidance and update their explanations accordingly.

Background

When employees with assets in a qualified retirement plan leave their job, the IRS requires the plan sponsor to provide the employee with a plain-language explanation of their rollover options. The IRS has published model notices for this purpose. Employers may also provide a custom notice to employees.

2018 Update

The IRS last updated its model notices in 2014. Changes in the Tax Cuts and Jobs Act ("TCJA") as well as other minor changes since 2014 have now been incorporated into the latest model notice.