Making a List and Checking It Twice: 2025 Amendment Deadline Approaches for Non-Profit 457(b) Plans

Non-governmental, tax-exempt employers (i.e., non-profit organizations) that sponsor 457(b) deferred compensation plans should add this item to their year-end to-do lists: amending the plan to comply with the SECURE 2.0 Act of 2022 (“SECURE 2.0”). Amendments are due Dec. 31, 2025 for calendar-year 457(b) plans.*

Most plan sponsors had their plan amendment deadlines extended under IRS Notice 2024-2 (for example, until Dec. 31, 2026 for 401(k) plans and Dec. 31, 2029 for governmental 457(b) plans). Non-governmental, tax-exempt employers weren’t included in these extended deadlines.

*Non-governmental, tax exempt employers with non-calendar year 457(b) plans have until the last day of the 2025 plan year to adopt required amendments.

What should I do if I’m a non-governmental, tax-exempt employer that sponsors a 457(b) plan?

Before the end of the 2025 plan year (Dec. 31, 2025 for calendar-year plans), take the following steps:

1. Reach out to your benefits advisor, recordkeeper, broker, or other contact to ensure that your 457(b) plan has been or will be timely amended.
2. Review any proposed amendments to confirm they accurately reflect both your 457(b) plan’s operations and any required amendments under SECURE 2.0.
3. Ensure participant communications and other documents (such as Summary Plan Descriptions (SPDs) or Summaries of Material Modifications (SMMs)) are updated to reflect any amendments.
4. Consider consulting with legal counsel to ensure all amendments are properly adopted.

What amendments are required under SECURE 2.0?

Examples of required amendments include:

• Age Increase for Required Minimum Distributions (RMDs). SECURE 2.0 increases the RMD age from 72 to 73 for individuals who reach age 72 after Dec. 31, 2022. The RMD age will increase again from 73 to 75 effective Jan. 1, 2033.
• Small Account Cash-Out Limit (if applicable). If your 457(b) plan increased its de minimis distribution limit from $5,000 to $7,000 in its administration, the plan must be amended to reflect this change. Note this is an optional increase under SECURE 2.0. However, a written amendment is required if the plan’s operations changed in practice to reflect the optional increase.

If you have any questions or need help navigating your plan amendments, contact one of our ERISA & Employee Benefits attorneys.