IRS, Treasury Updating Non-Profit Pensions

The Treasury Department and IRS issued proposed regulations this week relating to retirement annuity contracts under section 403(b), which are generally available to employees of public schools and organizations exempt from tax under section 501(c)(3), along with related temporary regulations clarifying the application of employment taxes to section 403(b) contracts.

"These regulations provide the first comprehensive guidance on section 403(b) arrangements in over 40 years," said Gregory Jenner, Treasury's Acting Assistant Secretary for Tax Policy. "These regulations would substantially revise the existing regulations to provide guidance on the various statutory changes that have been made for section 403(b) contracts during those 40 years, answer many outstanding issues that were not previously addressed in formal guidance, and demonstrate the increasing similarity among section 403(b) arrangements and the other types of retirement plans that provide for salary deferrals (section 401(k) and governmental section 457(b) plans). These regulations take into account the many comments and discussions we have received with insurance carriers, practitioners and others over the years about the issues that need to be resolved regarding section 403(b)."

The proposed regulations would not go into effect until years beginning after 2005.

A copy of the proposed regulations and the temporary regulations is highlighted below.

Proposed Regulations
Temporary Regulations

You may like these other stories...

Deal to lock in US tax cuts is bubbling up on the HillSome US lawmakers are exploring a post-election deal that would lock in permanent tax cuts for major corporations and low-income families, Richard Rubin of Bloomberg...
Read more from Larry Perry here and in the Today's World of Audits archive.This article discusses basic accounting principles for operating expenses under the FRF for SMEs. Part 2 will address basic auditing procedures....
Judge dismisses AICPA lawsuit against the IRSMichael Cohn of Accounting Today reported on Tuesday that a federal judge has dismissed a lawsuit against the IRS by the American Institute of CPAs (AICPA) over its new program...

Already a member? log in here.

Upcoming CPE Webinars

Nov 5Join CPA thought leader and peer reviewer Rob Cameron and learn ways to improve the outcome of your peer reviews while maximizing the value of your engagement workflow.
Nov 18In this session Excel expert David Ringstrom, CPA tackles what to do when bad things happen to good spreadsheets.
Nov 19How do you minimize redundant work and unnecessary steps to maximize the amount of work moving through your firm?
Nov 20Kristen Rampe will share how to uncover new opportunities with your clients by asking powerful questions.