Thursday, March 19, 2009

IRS lays out smoothing rules for Defined Benefit valuation

Defined benefit plan executives will be allowed to change the asset valuation methods they use in 2009 without seeking IRS approval, according to guidance issued by the agency.

The guidance, IRS Notice 2009-22, allows plans to change their method to take advantage of the Worker, Retiree and Employer Recovery Act of 2008 enacted in December clarifying that plans could smooth asset values looking back up to 24 months preceding the beginning of the plan year.

Under existing IRS rules, pension plans needed IRS approval to change the asset valuation method they used for their plans each year.

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