September 9, 2013 — Plan sponsors need to remember an important deadline is approaching, which is related the recent U.S. Supreme Court decision on the Defense of Marriage Act (DOMA).
The Groom Law Group released a brief in response to the court decision in the DOMA-related case of United States v. Windsor. In August, the Internal Revenue Service (IRS) had issued guidance in the form of Revenue Ruling 2013-17. The ruling specifically provided guidance on the definition of “spouse,” as well as the effective date of the decision, for federal tax purposes.
- Regardless of the plan document terms, treat all same-sex spouses as “spouses” for plan purposes. This is particularly important for beneficiary designations (obtaining proper spousal consent) and paying plan benefits particularly in the event of death, to ensure that same-sex spouses are entitled to spousal rights and protections.
- Consider sending a participant communication to notify participants of Windsor and the IRS guidance, and recommend they update participant records (e.g., update their beneficiary designation forms), indicate marital status on the distribution forms, and provide spousal consent, when required.
- Review and update plan distribution forms and administrative procedures to make sure they reflect the new law, generally treating a same-sex spouse as a spouse for plan purposes. This includes a review of the domestic partner/same-sex marriage procedures, and procedures for minimum required distributions, Code Section 415(b) limits, QDROs, loans, hardships, rollovers, and, of course, QJSA/QPSA benefits.
Click the external link below to read the entire article from plansponsor.com:
Click the external link below to review the Groom Law Group brief on “IRS ‘Place of Celebration Rule’ for Same-Sex Marriage Expands Rights and Simplifies Plan Administration”: