GUST-updated prototype deleted a needed provision

[Guest Robin Vatalaro]

I have a client whose pre-GUST prototype reflects a graduated match based on years of service. The document also specifies no HCE's can receive a match to eliminate the obvious discrimination problem. The document specifically states the match formula (e.g. it's not discretionary).

The post-GUST prototype just made available to me two weeks ago does not allow for a graduated match. I don't want to footnote the prototype and risk losing determination letter reliance.

Can I simply check the "discretionary match" box, check the "no HCE's can receive a match" box, and then have a Board Resolution set forth the graduated match formula? I reviewed both the std and non-std adoption agreements and neither one has a specific spot for graduated match.

Can anyone tell me if my suggested approach would cause any problems or cause me to lose determination letter reliance? Any help is appreciated.

[rcline46]

The no HCE can get a match box is a given. As to discretionary match, in my opinion not a problem BUT it also tends to indicate a flat % of deferral in the underlying language. That is NOT good.

Have the doc provider give you volume submitter doc for the same price, and put the language in there. Its the best method. Obviously they screwed up by not recognizing you had special language.

Note, at the volume of docs we are restating, in spite of our best efforts I know we will miss something. Hope the client will find it so we can correct. So screwing up with this massive restatement project is to be expected.

[Guest Robin Vatalaro]

For anyone interested (this was a Corbel-based prototype), I called Corbel. They did have the graduated match provision in their original submission for determination letter. The IRS made Corbel delete the provision (because of the obvious discrimination problem that can occur if the "no HCE" box is not checked). I'm not attempting to pass on legal advice from Corbel by making this next statement (info only) - Corbel recommends a volume submitter document for my situation.