Effective Date of GUST Restatement in regards to ADP/ACP Testing

[Guest BrianF]

Does the effective date of the GUST restatement matter for the election of current/prior NHCE %'s?

Here is the scenario:

We have clients who are leaving our firm and going to another firm effective 01/01/03 (calendar plan years). All plans were previously on a non-GUST restated prototype documents and the new firm will use their GUST restated document going forward. The GUST restatement will provide details on the current/prior NHCE % election for the plan years 1997-2001 and the permanent election chosen by the plan sponsor.

When completing the 2002 ADP/ACP testing, do I need to use the permanent election as stated in the GUST restated document? Does it matter if the effective date of the GUST restated document is not until after the 2002 plan year.

If there is flexibility on the current/prior election for the 2002 plan year, how is this handled under the GUST restatement section. Should an amendment be completed showing the election used for the 2002 plan year?

Whew! Thanks in advance for any assistance or advice.

Brian

[Blinky the 3-eyed Fish]

Since you are still within the remedial amendment period, you are free to choose whichever method you wish. When the document restatement is done, it will provided a history of the testing methodology used from 1997 onward. 2002 will be like any other year and merely be part of that history.

[Guest BrianF]

Thanks for the response. After posting the message, I was able to view another prototype. Next to the permanent election box, there was a space for the effective year to be entered. Once again, thanks for the help.

Brian