Plan Amendment Question

[Madison71]

Client with a 401(k) prototype plan had an amendment signed in early February 2009 and effective at the same time adding a company as an affiliated employer and permitting this company immediate eligibility while normal eligibility is 1 year. The amendment references all the appropriate sections of their old GUST document. Plan was also amended and restated and put on an EGTRRA document effective 1/1/2009 and signed in January of the same month. There is no mention of this affiliated employer in the EGTRRA document. So, there is an amendment referencing all the provisions of the old GUST document after the EGTRRA document was already put into place. How do I go about preparing an amendment referencing the new EGTRRA document? I don't see how I can prepare a discretionary amendment effective in 2009 and signed in 2010 without having a late amendment, and this amendment was prepared and signed timely, it just referenced the wrong document. Thanks.

[austin3515]

My opinion is that simply not mentioning them in the new EGTRRA Document would not be enough to kick them out of the Plan. It would take board resolutions specifically on point to do that. For example the document probably references "and any other Affiliated Employer who has adopted the Plan" in the definition of Employer.

I wouldn't back-date anything, but just have them re-adopt today usint eh new EGTRRA format. Our adopting employer paperwork allows you to indicate the date the adoption was originally effective which would just help to memorialize that this is simply a re-affirmation and not a new election.

[Madison71]

Thanks - that makes sense. I also am just noticing that the matching contributions are quite a bit more generous for employees of the affiliated employer (probably provided these benefits in their old plan) and this is spelled out in the amendment referencing the provisions in the old GUST document. How would you address this? Would you do an amendment effective 1/1/2010 with this benefit schedule or would you date that back to February 2009 when they actually came over?