Plan Document Signature Requirements

[Guest CRA]

Are all trustees listed on a plan document (prototype) required to sign the document or can just one sign?

[Guest annieap1]

I believe all Trustees are required to sign the Plan Document. By signing, individually, it indicates that they are each individually accepting the responsibility of trusteeing the plan.

[Kirk Maldonado]

annieap1:

I thought that is the purpose of the trust agreement.

Also, I've never seen an institutional trustee that would sign a plan document. Frankly, if they were willing to sign it, I wouldn't want them as the trustee.

[Guest SueJ]

If the prototype document is also the adoption agreement (serves as the trust agreement), the trustee does sign.

[Kirk Maldonado]

When I prepared my posting, I was focusing on individually-designed plans.

[GBurns]

Aren't Plan Documents and Adoption agreements signed by the employer Plan Sponsor, whereas the Trust Agreement is signed by the Trustee?

[Archimage]

Most prototype documents have the trust provisions written into them therefore there is not a separate trust agreement. However, there is usually an option to not use the trust provisions included and you could use a trust agreement separate from that offered by the prototype.

[GBurns]

Archimage,I can see the trust provisions being written into the documents but what do the Trustees sign accepting the provisions and the job?

[Mike Preston]

In a word: yes.

I took the OP as asking a slightly different question: If the plan is filled out with 2 Trustee's names, does the original adoption of that plan fail to be valid if the plan is only executed by the Employer and 1 of the 2 Trustees? If that was the intended question, I think the answer is that as long as the plan has at least 1 Trustee, it is a valid plan and Trust.

[GBurns]

While that seems to have been what the OP was asking, as quite often happens other issues were raised by subsequent posts which is why the thread continued.

[g8r]

Not to beat this to death, but I agree that as long as one trustee agrees to serve as trustee you have a valid plan. If there is another trustee named but that trustee doesn't sign a document (either on the adoption agreement or a separate acceptance document) agreeing to serve as trustee, then that person or entity is not a trustee. The bottom line is the designee must formally agree to serve as trustee.

However, once you have multiple trustees (i.e., more than one has been appointed and formally agreed to serve as trustee), then you need to look to the trust provisions (whether a separate trust or a trust within the plan) to see if there are provisions dealing with signatures. Many plans provide that a majority of trustees must agree to the action being taken, but that one or more have the power to sign on behalf of the others. I don't know that I'd want someone signing on my behalf (but that's a different story).

One final point regarding a prior comment. When using a prototype, the current IRS position is that you can only use a separate trust if that separate trust has specifically been approved for use with that prototype. Thus, if you use a separate trust that hasn't been approved for use with the prototype, you have an individually designed plan. This is the IRS interpretation of Rev. Proc. 2000-20 (and is the same interpretation they had of the predecessors - rev. proc. 89-9 and rev. proc. 89-13).