The Internal Revenue Service (IRS) has issued a revenue procedure that provides model plan language school districts may use either to adopt or to amend their written Section 403(b) retirement plans to comply with the final 403(b) regulations the IRS issued in July of 2006. A 403(b) plan is similar to a 401(k) plan, but for certain employees of public schools and tax-exempt organizations. The 2006 regulations, also available below, required that each 403(b) plan have a written plan describing how responsibilities are allocated between the employer, the entity offering investment options, and any other party involved. The revenue procedure provides guidance for applying § 403(b) to certain contracts issued before 2009. The model language is intended for a basic plan under which contributions are limited to pre-tax elective deferrals. By adopting the entire model language as its written plan, a school district will have the same assurance as it would by obtaining a private letter ruling in its plan from the IRS that the written form of the plan satisfies §403(b).
Revenue Procedure 2007-71
Employee Plans News
NSBA School Law pages on 403(b) regulations