Kevin C

The way I read Rev. Proc.2013-12 Section 6.05(2)(ii), there are only two exceptions to being required to file for a DL when you do a VCP nonamender filing. The first is 6.05(1) which applies to corrections by adopting model amendments and/or pre-approved documents. The other is 6.05(3)(a) which deals with late adoption of interim and optional law change amendments adopted before the end of the 5 year cycle the amendment was required to be adopted during. It doesn't look like your situation meets either exception. The handout for the last IRS phone forum on EPCRS has contact information for the speakers. If you still are not sure, you might try contacting one of them. http://www.irs.gov/pub/irs-tege/epcrs_changes_phoneforum_presentation.pdf

Does the document have an allocation method that can produce the desired contribution levels? You might also want to read PLR 200317048. Also on topic is PLR 200137064, although it deals with annuity surrender charges under a 403(b).

Rev. Proc. 2013-12 refers you to Notice 2004-84, which has the 2004 cumulative list that applied for the EGTRRA round of pre-approved DC documents. A comparison of that list to the document will show you what amendments were missed. http://www.irs.gov/irb/2004-52_IRB/ar11.html IF the EGTRRA restatement has all the needed language with the appropriate retroactive effective dates, it should work. For the nonamender filings I've done, I sent all the amendments and restatements that would have been done if we had maintained their document. Sungard had an article the other day that mentions the IRS position that an old missed amendment forever taints the plan, unless it is corrected under VCP or audit CAP. http://www.relius.net/News/TechnicalUpdates.aspx?ID=669 Also keep in mind that a VCP filing only covers the amendments submitted with the filing. They don't look for other missed amendments when they process the filing.

What does the plan say? Our VS document has the following: However, if a missing Participant or Beneficiary has not been located by the time the Plan terminates, the forfeiture of such Participant’s or Beneficiary’s distributable amount will be irrevocable.

If you correct the non-amender failure with the adoption of model amendments and/or model amendments, a DL submission is not required. See Rev. Proc. 2013-12 Section 6.05(1). With us being well beyond the time to submit EGTRRA pre-approved plans and with the recent changes to the submission program for the next generation of prototypes, I doubt they would accept a DL filing on a prototype. The whole idea of the correction programs is to give plan sponsors a way to get their plans in compliance. I don't see why they would turn away anyone who wanted to submit under VCP as a non-amender.

If the separate locations are considered separate trades or businesses, you might want to consider the following:

Forfeitures don't satisfy the timing requirements for salary deferrals under:

There isn't any guidance I'm aware of for spin-offs from SH plans. As for mid-year amendments to SH plans in general, there are widely varying opinions. A couple of other issues to consider. 1. The amendment to plan 001 could be interpreted as a suspension of the SH contribution in that plan for the affected participants. It doesn't sound like they have a substantial business hardship. 2. Plan 002 would be a successor plan under 1.401(k)-2©(2)(iii), so you can forget about safe harbor for a short initial plan year. My suggestion would be to take the gateway contributions they want to avoid giving to group 002 into consideration when they determine those substantial pay increases and make the plan changes effective next year.

I know they can, but has anyone actually had the DOL or IRS penalize a client for filing without the audit report and later amending to include the audit?

You may be thinking of the rule allowing you to combine the audits of two consequitive years if one of those plan years is 7 or fewer months. See instructions for Line 3(d)(2) on Schedule H. It starts at the bottom of page 37 of the 5500 instructions.

Also remember that Former Key only applies for determining the TH ratio. When you determine the TH minimum contributions, they are treated as non-key.

See 1.415©-2(g). Or course, the plan has to provide for it.

The size of the top 20% group and who is in it are determined by the census for the look-back year. Is the 11 employees information in post 1 from 2012 or 2011?

http://benefitslink.com/boards/index.php?/topic/42002-11g-amendments/?p=181165 Found it. The part I mentioned is starts with post #22. Time flies. It was from 2009.

Did the two non-owner HCE's make more than the owner last year?

From a discussion with Mike Preston in a thread a couple of years ago, I understood that what you are trying to do required certain language in the document. It might be more accurate to say it requires a lack of certain language in the document. You had to have a document that provided for an allocation method that was not required to satisfy 401(a)(4). I tried to search for it, but it isn't cooperating right now. When you start from a standardized prototype, I don't think you can get there from here. 1. Per PLR 9735001 once you pass the end of the year, the right to have that year's contribution allocated under the existing formula is protected by 411(d)(6). 2. -11(g)(3)(ii) requires that the amendment not reduce accrued benefits. 3. -11(g)(3)(v)(A) requires that the amendment satisfy 401(a)(4) and 410(b) on it's own. For Doghouse, I think your plan doesn't work because of 2. and if you are also trying to increase the other owner's contribution over what the original formula provides, because of 3. I wasn't concerned last year about the plan losing its standardized prototype status because if you did what you wanted to do, prototype status would have been the least of your worries.

A more recent mention of the 410(d) election method is in Rev. Proc. 2011-44, Section 2 Background.

I guess I don't understand the confusion. Notice 2001-46 says non-electing Church plans must operate in accordance with a reasonable good faith interpretation of 401(a)(4). I don't see any way you can twist that into they are exempt from 401(a)(4). The discrimination rules in 401(k) are the exclusive means of demonstrating non-discrimination under 401(a)(4) for the 401(k) portion of the plan. See 1.401(k)-1(a)(4)(iv)(A). It's also in 401(k)(1), but not so clearly worded.

Can you provide a cite showing that non-electing church plans are deemed to satisfy 401(a)(4)? Notice 2001-46 says:

This situation was one of the questions addressed at the end of the IRS phone forum on EPCRS yesterday. The speaker said you can correct by refunding the deferrals to the participant and forfeiting the employer contributions. She made a brief comment that we interpreted as saying you would correct the W-2, but I don't recall the exact words. Eventually, the recording should be available on the IRS website.

When you are using elapsed time to determine service, there is a rule covering terminations when the participant rehires within 12 months.

When you are dealing with deferral and match deposit errors, timing can make a big difference. What were the pay dates for the deposit errors? Here is a recent discussion about an extra deposit made by mistake. http://benefitslink.com/boards/index.php?/topic/52655-mistake-or-not

There are DOL regulations setting the minimum requirements for a plan's claims procedure. You will want information on the plan's claims procedure, which is required to be included in the Summary Plan Description. If you are a participant in the plan and don't have a copy of the SPD, ask your employer for one.

The only way the tax treatment of a deemed loan can be changed is if the Employer files under VCP and specifically asks for the change in the tax treatment in connection with the loan correction. Rev. Proc. 2013-12 Section 6.07 (1) & (2). The loan must still be within the original maximum repayment period to be eligible.

There's a little more to it. There isn't a corrective deposit needed for the salary deferrals, but there is a correction needed for the match. You will want to refer to the Rev. Proc. for the details.