How do we get PPA provisions in pre-approved plans?

[Trekker]

Many provisions in the pre-approved plans are already obsolete due to PPA, such as some gap period income, corrections for excess annual additions, etc. And, of course, no pre-approved plans contain provisions for non-spouse beneficiary rollovers and other PPA additions.

Has the IRS issued any guidance about how to get PPA provisions added to plans adopted by clients using volume submitter or other pre-approved document?

Thanks.

[J Simmons]

As yet, the mandatory provisions of PPA do not need plan document provisions. At first the IRS said that non-spouse beneficiary rollovers was discretionary, but for 2008 and beyond seems to hold that it is mandatory.

For the discretionary provisions of PPA, if the plan is a prototype, the prototype sponsor can amend the new EGTRAA-class prototype to add those provisions, with or without adding mini-adoption like agreement for each adopting employer to select which discretionary provisions will apply to its particular plan.

For volume submitter, I suppose each employer could make an amendment.

BTW, some of the EGTRAA-class prototypes were allowed to add the non-spouse beneficiary rollovers to their documents before IRS approval.

[Peanut Butter Man]

I think this is one of the inherent problems with Rev. Proc. 2005-66. The EGTRRA prototypes and volume submitters are based on the 2004 Cumulative List. Adding PPA provisions to those documents creates a fairly large amendment with a lot of changes to the document and the SPD. I've been struggling with whether it is better to provide the EGTRRA SPDs and provide participants with SMMs for all of the PPA amendments, or whether we just want to rewrite the SPDs to incorporate the changes from the PPA amendments, especially for our defined benefit plans.

Part of the struggle I'm having with the SPD is the IRS running on 6-year cycles for the documents and the DOL requiring updated SPDs to be provided every 5 years. Most of our GUST defined benefit plans have an SPD from 2003 or 2004, and the EGTRRA defined benefit prototypes and volume submitters will not be available until 2010, which means we need to come up with an updated SPD this year.