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I would say "yes". Every firm I have worked for would say you should say "yes" This is however something the plan administrator has to decide. Every plan document give the administrator discretion to interpret the plan provisions in a consistent and nondiscriminatory manner that doesn't clearly contradict a plan provision or the law. This is a classic example where that power should be used. The plan administrator should make a determination as to the answer to this question and document it. After that everyone should be treated the same.

1. No one goes to pension prison on this one. 2. As a propeller spinner, I always ask the auditor to send me a mark up up what they want to see changed. So long as nonmaterial, I accept their changes because frankly Scarlett, I don't . . . and this is not a pot worth throwing your chips into. Now if there's some problem later, the auditor can sort it out. In nearly 40 years, there's never been a problem.

If you are looking for a cite, Rev. Proc. 2013-12, Section 6.05(1)(b) refers you to 6.05(1) when determining if you need to file for a determination letter on an SCP corrective amendment. 6.05(1) says if you correct using a pre-approved document don't submit for a letter.

That always brings me back to an old argument we had with a client years ago about Date of Death on their conversion to SAP HR/Benefits. They wanted it to be the "date you were first fully dead the whole day". UGH! If you worked at all on 12/31, you were an employee on 12/31. Their argument was that if you were alive at all on a specific date, you were alive all day.

"Some" have their heads wedged. If the requirement is that you have to be an employee on 12/31, then if you are employed by the company at any time during 12/31, you were an employee on 12/31. You go home as a retired person, never to return, but as jpod says, your last day of employment was 12/31. And it's hard to have a last day of work when you are not an employee. BTW, did the company pay you (or owe you pay) for 12/31, or because you were not really employed that day, did you give them a free day of work? (Is that FLSA knocking?) Now, if the requirement reads that you have to be an employee as of 11:59:59 of 12/31, that's a different matter. Check the Plan Document.

Last day of employment must be 12/31. What is so difficult about this?

FCG. I add to MoJo's comment, just because you/the Plan states that ERISA governs the Plan does not make it so. There can be challenges to almost anything, especially since ERISA does not define everything. Why leave a door open, which could be used against you? Just choose your state of domicile, so that any legal challenges will be local. It is much easier to handle a local case, than a case in another, maybe even distant, state.

The one thing I ALWAYS advise my clients to avoid is having a judge decide things that they could have decided themselves trough careful drafting of documents. Under our system of jurisprudence, some things are dealt with under federal law, some are dealt with under state law, and some are dealt with under "common law." ERISA and the tax code pre-empt, but they don't cover everything - so one looks to "state law." WHICH STATE LAW APPLIES is often very complicated and difficult to determine. State law may impact how trusts are governed. ERISA says a trust must be used, but doesn't specify how to establish one (and there is no "federal law of trusts"), and while it may indicate who can't be a trustee (trust me, ERISA has a few prohibitions), it doesn't say WHO can be the trustee. For example, in SOME states, a NON-trust company corporation CANNOT be trustee of it's own employee benefit plan. In others, a NON-trust company corporation CAN be trustee but ONLY of it's own employee benefit plan, but no other trusts. Its State law based (and in that case, there could be a CONFLICT between the state of incorporation (often Delaware) and the state of it's principal place of business (GM is a Delaware corp with it's main office in Michigan - which state governs?)). Those are the "simple" issues. IF YOU DO NOT SPECIFY WHICH STATE LAW GOVERNS IN NON-PRE-EMPTED AREAS, The judge gets to decide - and that's just plain stupid.... Why not put some predictability in the process and spell it out?