New IRS regulations require response

Concordia Plan Services (CPS) is offering resources to help LCMS congregations, schools, and other church organizations understand revised Internal Revenue Service (IRS) regulations that go into effect Jan. 1, governing tax-deferred
savings plans and tax-sheltered annuities — and which will require response by many LCMS employers, according to CPS.

An article prepared by CPS for this issue of Reporter reads as follows:

“The revised IRS 403(b) regulations (governing tax-deferred savings plans and tax-sheltered annuities) that go into effect on January 1, 2009, will have a significant impact for all employers, including church organizations that have at any time permitted their workers to make pre-tax contributions to a 403(b) plan. Depending on the employer’s decision and action regarding the new regulations, their workers can be affected as well.

“In the past, 403(b) plans have generally been considered an individual contract between the worker and a 403(b) provider. With the revised regulations, the IRS has made it clear that 403(b) plans are now going to be regulated as employer-sponsored plans. This means employers will have ongoing oversight and compliance responsibilities, including the requirement of a written plan document, for any 403(b) providers to which their workers make pre-tax contributions.

“As an option, any LCMS employer enrolled in The Church’s Plan and using only the Concordia Retirement Savings Plan (CRSP) after December 31, 2008, has the assurance that Concordia Plan Services and MetLife will take responsibility for most of the administrative and compliance issues of the new regulations minimizing the administrative burden on the employer.

“To help employers and workers understand these revised regulations and the employer’s increased responsibilities, Concordia Plan Services has compiled helpful resources. To access the information, visit the Concordia Plan Services Web site at and click on “Retirement” on the left, select “Concordia Retirement Savings Plan,” then “403(b) Regulations.” There you will find:

  • “A link to the IRS Web site, where you can view Q & A and link to a copy of the 131-page revised regulations.

  • “A link to the MetLife Web site, which also provides many resources regarding the IRS revised regulations (MetLife is the administrator of the Concordia Retirement Savings Plan, the 403(b) plan offered through the Concordia Plan Services).

  • “A Glossary of 403(b) terms which is a handy reference tool when reading about the regulations.

  • “The Concordia Plans Update newsletter which was mailed in late August 2008 to all LCMS employers participating in the Concordia Plans. This newsletter explains what these new regulations mean for employers.

  • “A recorded “Webinar” that references the Concordia Plans Update and presents the topic in a user-friendly format geared toward LCMS employers.

“The revised regulations have the greatest impact on employers that allow salary deferrals to multiple 403(b) providers. Employers in this situation are urged to carefully consider their options and research the costs and impact to staff and resources if they wish to support contributing to multiple providers after December 31, 2008.”

Posted Sept. 25, 2008

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Reporter Online is the Web version of Reporter, the official newspaper of
The Lutheran Church—Missouri Synod. Content is prepared by LCMS Communications.

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