401k plan uses a standardized prototype sponsored by small TPA - requi

[Guest billy bong]

the non-elective contribution requires >500 hours for ALL participants, even those employed on last day. no amendments or additional language has been included in document to allocate contributions to all participants employed on last day for post 1990 plan years. i believe this is a plan document failure?

though yesterday, during the live satellite broadcast of the ALI-ABA seminar, J. Kahn, the chief of the EPCRS, stated that there would be a plan doc failure only if the requirement of 1000 hours.

i am totally confused as to what exactly the requirements are for a standardized doc. or perhaps JK was incorrect or did not understand the question?

thanks

[Guest Rena Breeding]

A standardized document must grant a participant employed on the last day of the year an allocation of the employer's allocation regardless of the number of hours worked/completed. It also must grant an allocation of employer's contribution to a terminated participant who worked more than 500 hours during the plan year.

It sounds like non-standardized wording has been attached to a standardized document. The client would not be able to rely on the determination letter issued to the standardized document. They may want to consider filing for a determination letter. I believe the process is currently on hold for the 2000 amendments and legislation updates.