2022: Quarter 3 Newsletter
Universal Availability
Each year AFPlanServ provides a sample Plan Eligibility Notice to help satisfy the Internal Revenue Service (IRS) Universal Availability requirement. A Universal Availability notice must be given to all eligible employees annually. The Plan may exclude employees who are:
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Non-resident aliens.
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Employees who typically work less than 20 hours per week (or lower if the Plan requires).
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Students performing certain services.
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Employees eligible to participate and make elective deferrals under an eligible governmental 457 Plan.
The Plan Document will indicate if any of these employees are excluded. One exception is employees contributing to their 403(b) account changed to a position that falls under the Plan's excluded employees. To verify your Plan’s excluded employees, you may contact us or review the copy of the Plan Adoption Agreement sent to you in your binder when your Plan was established.
Learn more about Universal Availability►
Did you know?
The IRS audits all qualified Plans. Therefore, employers should maintain policies and information to demonstrate compliance if an audit occurs. AFPlanServ can provide reports of your Plan activity or Plan documentation upon request.
Contact us if you require documentation ►
We work with you to monitor contribution limits for Plan Participants across all your Plan’s approved Investment Providers. This helps ensure that contribution amounts, including catch-up contributions, do not exceed allowable annual limits. Monitoring also helps lower the risk of excess contributions and allows corrective action to be taken before the end of each tax year and after that, as necessary.
AFPlanServ will notify you of any excess contributions identified. If within the same calendar year, we will inform the Provider and request a refund of the extra amount to the Plan. You will need to stop any remaining payroll deductions immediately. The Participant will need to complete a new salary reduction agreement to reduce the amount for the current calendar year. If an excess contribution is identified after the end of the calendar year, AFPlanServ will notify you and the Provider, and a corrective distribution will be processed to the Participant.
Transaction processing is the majority of what we do as your Plan Administrator. This process involves approving Distributions, Exchanges, Loans, Hardships, Transfers and Salary Reduction Agreements. AFPlanServ provides this service to relieve the burden on you and help make sure your Plan stays in compliance with IRC guidelines. In addition, this enables us to maintain a single record of transaction approvals for your Plan in the event of an IRS audit.
We want to emphasize that the School District must not sign requests for transaction approvals as this is part of the services that AFPlanServ provides for you. This includes requests from retired or terminated employees. Therefore, all transaction requests must be sent to AFPlanServ for approval by fax or mail.
Frequently Asked Questions
Q: What is Universal Availability?
A: Universal Availability is the requirement that all eligible employees be given the opportunity to participate in your 403(b) Plan annually.
Q: How do I update the excluded employees in the Plan?
A: To update, a written request must be sent to AFPlanServ, which includes who is to be excluded. Then, we will work with you to amend your Plan.
Plan Reminders
Each year, AFPlanServ provides a Sample Eligibility Notice to help satisfy the Universal Availability requirements.
You may use it as a template for your custom notification or distribute the sample in its entirety.
Please check the Operational Guidelines to ensure you adhere to the items listed. If you have any questions, please contact us.
To update the contact information for your Plan, please complete the Employer Contact Form.
If you need more information about your role as the Plan Sponsor, we're happy to help!