Amended out of a prototype from the "get go"-still entitled

[KJohnson]

An employer's plan has one or two "quirks" that don't fit into a prototype, but they go ahead and, with the permission and approvoal of the prototye sponsor, adopt the prototype document with an addendum for the few "quirky" provisions and the addendum also contains a statement that the plan is an individually designed plan. Are they entitled to an extended remedial amendment period based on the following language from 2000-20?

.06 Certain Employer Amendments Disregarded for Purposes of This Section - An employer that has adopted an M&P plan or a volume submitter specimen plan may have modified the plan in a such a way that the plan, as adopted by the employer, would not be considered an M&P plan or a volume submitter plan. Nevertheless, for purposes of this section, such a plan will be treated as an M&P or volume submitter plan and will be eligible for the remedial amendment period extension provided by this section. For example, an employer may have adopted an individually designed GUST-related amendment to an M&P plan that would have caused the plan to be considered an individually designed plan under section 5.02 of Rev. Proc. 89-9. Despite the individually designed amendment, the plan will be treated as an M&P plan for purposes of this section.

[Bob R]

The answer depends on who you ask. To be safe, have the employer sign a certification of intention to adopt the GUST prototype.

At ASPA, Dick Wickersham stated that he thinks the employer should have at least adopted the plan as a prototype before making the amendments. But, the language you cited doesn't exactly say that. And, what if you were establishing a new d/b plan using a prototype. GATT amendments would be needed to the TRA '86 prototype so that you could take it into account for funding. So, from day 1 you could have an individually designed plan. And, I think the language in Rev. Proc. 2000-20 was added for this type of situation.

But you can't go wrong by using the certification.

[KJohnson]

.This is from the IRS's most recent employee plan news:

An M&P or volume submitter plan that has been amended in a way that would cause the plan

to be treated as individually designed is still eligible for the extended GUST remedial

amendment period underSection 19 of Rev. Proc. 2000-20, regardless of the nature of the

modification or whether the modification was adopted subsequent to, or in conjunction with,

the initial adoption of the M&P or volume submitter plan. An amendment of an M&P plan to

provide for a non-uniform formula is only one example of an amendment that would cause

the plan to be treated as individually designed yet not cause the plan to be ineligible for the

extended GUST remedial amendment period under Section 19 of Rev. Proc. 2000-20

[Alf]

The IRS is on record that they will be flexible on the certification requirement, but that a plan that is not eligible for prototype status cannot certify to get the 12 month extension.