Perhaps channeling the old adage of “if it ain’t broke, don’t fix it,” the IRS recently released Notice 2022-27 extending through December 31, 2022 its temporary relief from the requirement that spousal consent for plan distributions or loans be witnessed in person.
As discussed in greater detail in our earlier posts (here and here), in response to the COVID-19 National Emergency, the IRS issued guidance temporarily allowing a notary or plan representative to witness spousal consent electronically via live video, provided certain conditions are met. This relief was originally issued in June 2020 and due to expire on December 31, 2020, but then was extended twice under the same conditions.
Following those two extensions, the relief was scheduled to expire at the end of this month. Notice 2022-27 now further extends the relief through the end of 2022. The conditions for obtaining relief (described in our first post) remain unchanged.
Although the IRS stated that it does not expect a further temporary extension (due to easing public health precautions in connection with the pandemic), the IRS is currently reviewing comments it previously received from stakeholders regarding whether to make the relief permanent. The Notice reiterates that the IRS will use the formal regulatory process (including an additional notice and comment period) if it proposes permanent changes to the physical presence requirement.
Plan administrators should be aware of this guidance and should continue to ensure that electronic witnessing meets all of the conditions set forth in the temporary relief.