The adoption agreements of most prototype documents contain a section requiring acceptance by the prototype plan sponsor. In that way, the documents cannot be used without the knowledge and consent of the prototype sponsor. What happens if the prototype document is used without the sponsor's written consent? Is the Plan a valid adoption of a prototype? Is this a qualification issue?

I am not sure on this, but certainly an argument can be made that the plan was never adopted. Therefore there is no plan. I think you would have to look at the resolution adopting the plan, if there is one.

If you adopt a Plan document without the Plan sponsors approval you would have a plan that may be qualified in operation but would be viewed as an individually designed plan as you would not have an IRS notification letter. Plan Sponsors are required to annually submit a list of adopting employers.

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The requirement to submit a list of plan sponsors utilizing a regional prototype was eliminated 2(?) years ago. There is a requirement that the prototype sponsor maintain a list and furnish if the IRS requests. I agree the unauthorized use of a prototype document, if not in some violation of the document, would be treated as an Individually Designed Plan.

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