GUST / EGTRRA Amendments - new to this and need a straight answer.

[Guest tintree73]

Hi. I have a new job involving 401(k) administration for a single employer.

The plan was in existence prior to 2002 under one prototype and will be amended this year to move to another provider's prototype. I have been asked to review the new adoption agreement (compare it to the old to make sure it is consistent, etc.) and I have been working on that.

However, I need straight answer re the GUST and EGTRRA amendment time frames and what must be included. I did find checklists offered from the Groom Law Group, but is there anything else I should be looking for/worrying about?

Also, does anyone know of a good educational course I could use to get up to speed on these issues?

Any help is greatly appreciated! Thanks.

[Guest mrilao]

You may want to take a look at the following web page for some helpful advice.

http://www.seethebenefits.com/CRLframeset....cle.asp?ID=1541

[austin3515]

As far as GUST goes, request a copy of the IRS determination letter and go no further. The IRS has already made sure that the adoption agreement and the prototype document are in compliance.

As far as EGTRRA goes, there should be a separate amendment and (typically) a separate adoption agreement. If its a well known provider I'd be hard pressed to think it was somehow not compliant. I would just make sure that the amendments were in fact made.

Also, if you're using a standardized prototype it should be designed such that its impossible to not be qualified as designed.

I think you're time could be better spent then to review the product of a team of ERISA attorneys. I don't think there's many prototypes out there with qualification issues. And even if there are, the IRS has already blessed them.

[Mike Preston]

I think the time you spend making sure the provisions from one prototype to the next are consistent will be time very well spent.

Remember that EGTRRA amendments are not required. The important thing is to ensure that your administration matches the dcoument provisions. If there HAS been an EGTRRA amendment, as there probably has been, it is likely that administration for the years in question will be different than it would otherwise have been.

The GUST amendment, if the plan is a prototype eligible for the typical extension, which it probably is, is due by 9/30/2003. You should be fine on that.

The EGTRRA amendment, in most cases, should have been executed by 12/31/2002 in the case of a calendar year 401k/ps plan. The only thing I would be concerned about would be if the EGTRRA amendment wasn't done by then, but the plan was adminstered as if the new law's provisions applied anyway.