IRS ISSUES PROPOSED LONG-TERM, PART-TIME REGULATIONS By Ascensus The Internal Revenue Service (IRS) has released a proposed regulation reflecting statutory changes related to long-term, part-time (LTPT) employees made by the SECURE Act of 2019 (SECURE Act) and the SECURE 2.0 Act of 2022 (SECURE 2.0). This proposed regulation would amend Treasury Regulation (Treas. Reg.) 1.401(k)-5 to reflect the rules for LTPT employees, including specific eligibility and vesting requirements. The proposed regulation also provides guidance regarding employer contributions with respect to LTPT employees and the impact that LTPT employees will have on nondiscrimination, coverage testing and top-heavy benefits. Background Historically, employers could design their 401(k) plans to prevent part-time workers from entering a plan by requiring employees to be credited with NEBRASKA INDEPENDENT BANKER 17
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