skip to content »

Egtrra updating plan documents

In order to maintain a qualified plan, the IRS requires that you have a written plan document.

egtrra updating plan documents-62egtrra updating plan documents-48

If you use a pre-approved docu- ment but have not been contacted by the provider of the pre-approved document, we suggest that you proac- tively contact them and ask when you can expect a copy of your restated plan document for review.At that time, the IRS established a 6-year cycle for pre-approved plan documents such as prototype and volume submitter doc- uments.The initial 6-year cycle ended on April 30, 2010, the deadline for plan sponsors using a prototype or vol- ume submitter document to adopt an EGTRRA restate- ment. It be- gan with the provider’s submission of prototype and volume submitter documents to the IRS for new opinion or advisory letters between February 1, 2011 and April 2, 2012.Determination Letter Applications for Pre-Approved Plans In recent years, the IRS limited the categories of pre- approved plan documents that can be submitted for an individual determination letter on Form 5307.If your plan uses a standardized or nonstandardized prototype document, the plan may not apply for an individual deter- mination letter but instead can rely on the prototype docu- ment’s IRS opinion letter.As a plan sponsor it is critical to the plan’s success that you retain a good third party administrator (TPA) to assist you with your document and amendment work.

Failure to timely restate and amend your plan can result in plan disqualification and taxation of plan assets, but more likely will result in IRS imposed penalties. (ARS) notifies our clients of all plan amendments and restatements necessary to keep their plans qualified. For the prototype plan document used by ARS, below are the restatements and amendments required since 1998.

While the PPA restatement document may look very simi- lar to the EGTRRA restatement document, it is important that you review the new restatement in detail to ensure not only that the new document properly reflects the interim amendments’ provisions, but also that the indi- vidual selections not affected by the interim amendments are properly drafted.

While pre-approved plan sponsors make every effort to prepare restated documents accu- rately, errors can occur; for instance, if the plan sponsor’s selections regarding categories of excluded employees are not carried over from one document to the next.

The IRS also announced that it will begin to accept individual determination letter applica- tions for the PPA restatement documents from May 1, 2014, through April 30, 2016.

Pre-approved Plan 6-year Cycle The IRS revamped the restatement timing and related remedial amendment system back in 2005.

GUST stands for GATT (General Agreement on Tariffs and Trade–generally referred to as the Retirement Protection Act of 1994), USERRA (Uniformed Services Employment and Reemployment Rights Act of 1994), SBJPA (the Small Business Job Protection Act of 1996), TRA…