403(b)Plan documents

[Guest Kent Scrivener]

I have been supplied with a 403(B)"specimen" plan document and Summary Plan Description by a large insurance carrier (to go along with its group annuity contract). The carrier has dubbed it a specimen document and SPD because it has made it extremely clear that it does NOT want to have anything to do with the final drafting of the document which should be done by the 403(B) plan sponsor's ERISA attorney.

Could someone please direct me to a plan document provider/service that will be able to 1) provide a reasonably priced document that the 501©(3) org will pay for; and

2)maintain the document each year updating it for any changes in the code.

Your advice would be very much appreciated.

------------------

[Michael Devault]

I believe that Corbel in Jacksonville, Florida provides such a document and service.

Good luck.

[Guest Kent Scrivener]

Michael, thanks for getting back to me with this info re Corbel. I was familiar with the fact that they do offer a 403(B) plan document;however,the problem is what they charge. I believe their price is roughly $850 for the document. I was hoping to find one for significantly less than what they are asking where the provider would update it each year. I realize that an annual maintenance fee would probably apply.

Any chance you would know of any other places/firms I might check with?

Would Ellie Lowder, NTSAA's technical advisor, know do you think?

------------------

[Michael Devault]

Kent, I know of no other firm that provides documents without accompanying services. Some TPAs around the country provide plan documents as part of their service, but it's generally combined with their overall administration package.

Ellie knows EVERYTHING about the TSA business. Give her a call.

[Ellie Lowder]

Try PenServ at 215-628-8950, Kent. Nope, Michael, I don't know everything, but thanks for thinking that!!!!!

[Guest Steve M]

I think that it is worth noting that the 403(B) audit guidelines indicate that there is no requirement for a definite written program such as a 401(a) plan document for 403(B). Often, the annuity contract itself is all that there is. As long as it conforms to the requirements of 403(B) as outlined in the audit guidelines, that is fine. Maybe an individual annuity contract would be the way to go.

[Carol V. Calhoun]

One problem is that 403(B) plans for 501©(3) organizations do require a plan document, unless they are salary reduction only and meet other standards set forth by the Department of Labor. The 403(B) plans examination guidelines to which you refer deal only with the IRS requirements, not the Department of Labor ones.

------------------

Employee benefits legal resource site

[pjkoehler]

Even if the IRS and DOL leave you alone, the road to fiduciary liability in employee benefits cases is paved with employers who commoditized plan documents and sought out the lowest cost provider, ultimately discovering that they had simply been penny-wise and pound-foolish. Regardless of the tax-exempt status of the sponsoring organization, if it is going to employ staff, it will be exposed to a risk of litigating benefit claims. Why sue a not-for-profit, tax-exempt with laudable social goals? Well, to a large extent because that's where the poorly drafted plan documents are, mother's milk to plaintiff's lawyers looking for cases with settlement value.

[Alf]

DITTO!!!! You get what you pay for. I would even question (or at least get independant legal counsel to review) an $850 plan document.