<nobr>Feb 4, 2005</nobr>

ERIC & PSCA Submit Letter to IRS Calling for Delay of NQDC Deadline

ERIC AND PSCA JOIN FORCES TO ASK FOR DELAY IN MARCH 15 DEADLINE FOR NQDC MIRROR AND EXCESS PLANS

Below is a copy of joint letter sent today by The ERISA Industry Committee and the Profit Sharing/401(k) Council of America urgently asking that the Treasury and IRS modify Notice 2005-1 as soon as possible to extend the period that the Notice now gives to defined contribution mirror and excess plans to meet the requirements of the new law governing nonqualified deferred compensation.

Both ERIC and the Profit Sharing Council are urging other business groups to take similar action and are working with Treasury and Congressional staff to urge that a delay be granted as soon as possible.

Q&A-21 of the Notice gives participants until March 15, 2005, to make initial deferral elections (or to increase prior deferral elections) for their 2005 compensation, provided certain requirements are met. However, in the case of spill-over plans, the proposed rules do not provide enough time for plan sponsors to make necessary revisions in their plans, plan procedures, and plan communications materials, and for participants to educate themselves and make decisions in accordance with the new law. The letter asks for a delay of the deadline until December 31, 2005.

Notice 2005-1 is the first major round of guidance implementing the nonqualified deferred compensation provisions of the American Jobs Creation Act (P.L. 108-357), enacted last October.

ADDITIONAL ACTION: Companies should contact the individuals named in this letter as well as members of the Senate Finance and House Ways and Means Committee to urge that a delay be granted. (While Treasury has authority to provide the delay, agreement from Congress that a delay is appropriate can help to hasten action.)

For questions or additional information, contact:
Mark Ugoretz, President (mugoretz@eric.org)
Janice Gregory, Senior Vice President (jgregory@eric.org)
Vanessa Scott, Legislative Counsel (vscott@eric.org)

Websites:

Joint Letter to IRS Re: NQDC Delay of Deadline

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