Notice 2016-39 does not apply to Non-Qualified Contract

In conjunction with the issuance of Notice 2016-39, the IRS also released Revenue Procedure 2016-36 providing that Notice 2016-39 does not apply to payments received from a retirement plan by an employee during phased retirement from a non-qualified contract.

Document Excerpt

This revenue procedure provides guidance regarding the application of §§ 1.72-2(b)(2) and 1.72-4(b)(1) of the Income Tax Regulations to amounts to which § 72 of the Internal Revenue Code applies that are received from a non-qualified contract. This revenue procedure does not apply to amounts to which § 72 applies that are received under a qualified plan as described in § 72(e)(5)(D). See Notice 2016-39, 2016-26 I.R.B. (June 27, 2016).


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