DOL Clarifies Application of Deadline Suspensions for Employee Benefit Plans, Mar. 4, 2021

As noted in prior weeks, several key deadlines were extended in response to the COVID-19 pandemic—namely, many deadlines applicable in the COBRA context. However, practitioners noted that ERISA technically only permits a one-year delay—and now, one year later, the end of national emergency has yet to be declared. Last week, the IRS, Department of Treasury, HHS and DOL released a statement clarifying that taxpayers subject to the relief will have the applicable periods disregarded until the earlier of (a) one year from the date they were first eligible for relief or (b) 60 days after the announced end of the national emergency (the end of the outbreak period). On the applicable date, the timeframes for individuals and plans with periods that were previously disregarded will resume. In other words, in no case will a disregarded period exceed one year. However, the relief also acknowledges that taxpayers continue to struggle in the wake of the pandemic—and notes that plan fiduciaries should make reasonable accommodations to prevent the loss of benefits or delayed payments where possible. For more information, see Q 371.