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Annual Funding Notice GuidanceField Assistance Bulletin 2025-02 provides guidance on the annual funding notice requirement changes as set forth by SECURE 2.0.
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Disaster Relief for Arkansas, Tennessee, and VirginiaThe IRS and PBGC have issued disaster relief in response to severe storms and flooding in Arkansas, Tennessee, and Virginia.
On May 28, 2025, the U.S. Department of Labor Employee Benefits Security Administration (DOL) rescinded its earlier guidance around 401(k) plan investments in cryptocurrencies. This update also includes removing the “extreme care” that was outlined in the earlier guidance.
Background
On March 9, 2022, the DOL issued Compliance Assistance Release (CAR) 2022-01, which outlines concerns related to 401(k) plan investments in cryptocurrencies. The DOL urged plan sponsors to use extreme caution before adding cryptocurrency as investment options for plan participants.
CAR 2025-01
p>CAR 2025-01 released May 28, 2025, rescinds the DOL’s earlier guidance siting that “extreme care” is not defined in the Employee Retirement Income Security Act (ERISA). As a result, a plan fiduciary must follow ERISA requirements of “care, skill, prudence, and diligence” in selecting investments.
The DOL neither endorses nor disapproves of plan fiduciaries who conclude that cryptocurrency is appropriate for the 401(k) investment lineup. Additionally, although cryptocurrency is specifically called out within CAR 2025-01, a footnote goes on to state that the same reasoning and principles may also apply to other “digital assets.”
The Internal Revenue Service (IRS) modified the procedures for using plan-specific mortality tables for the purposes of determining minimum funding requirements for defined benefit (DB) retirement plans. Revenue Procedure 2025-21 grants a narrow exception for some plan sponsors using substitute mortality tables approved before 2025.
Background
The Pension Protection Act of 2006 specifies the minimum funding requirements that apply generally to single-employer DB retirement plans. The mortality tables used to calculate minimum funding are prescribed by the Secretary of the Treasury by regulation. Some DB plan sponsors may request approval to use a plan-specific substitute mortality table for up to ten years or if certain conditions are met that would require early termination, such as a significant change in the individuals covered by the plan.
Updated Guidance
Revenue Procedure 2025-21 added an exception for plans using substitute mortality tables that use one mortality ratio for all genders. Under this exception, a plan’s approval to use a substitute mortality table will not terminate early if the:
- Total number of covered individuals, regardless of gender make-up, is between 80% and 120% of the average number of covered individuals over the relevant 12-month period.
- Plan’s actuary certifies that the substitute mortality tables still accurately predict the population’s future mortality.
If a DB retirement plan has not experienced a significant change in coverage, then the substitute mortality table may continue to be used after 2025. However, if the substitute mortality table reflects the experience in any of the COVID years (2020 through 2022), then the plan sponsor must request approval for a new plan-specific table that meets the final rules or revert to the regular prescribed tables.