Restating to Pre-approved plan

[Oh so SIMPLE]

A plan's documents are currently individually designed. The last digit of the EIN is 0 or 5. The EGTRRA restatement cycle is E, with a deadline of January 31, 2011.

May the plan be restated at this time using a prototype or volume submitter? I'm wondering if since the prototype era came to an end on April 30, 2010 if it is too late.

[John Feldt ERPA CPC QPA]

Yes.

From SunGard's Technical Update:

DC Plan Sponsors with an EIN ending in 5 or 0 (cycle E) have until January 31, 2011, to complete their EGTRRA restatement. Therefore, a plan sponsor on cycle E that is using a prototype or volume submitter document can rely on the 5-year cycle deadline if it missed the April 30, 2010, deadline. So, approximately 20% of the plan sponsors who thought they were late are not. They can qualify for the January 31, 2011, restatement deadline.

Q-1: If a plan sponsor using a prototype or volume submitter document utilizes the January 31, 2011, deadline (i.e., cycle E) rather than the April 30, 2010, deadline, will the plan sponsor be able to have retroactive reliance (i.e., back to the beginning of the 2002 plan year) on the prototype or volume submitter letter?

Yes. By adopting a pre-approved plan by January 31, 2011, the last day of the (cycle E) plan’s remedial amendment period cycle, the plan is entitled to reliance upon the pre-approved plan sponsor’s approval letter (assuming the sponsor only makes elections permitted under the pre-approved plan).

Some helpful links:

http://www.relius.net/News/TechnicalUpdates.aspx?ID=533

http://www.irs.gov/retirement/article/0,,id=227643,00.html

http://www.irs.gov/pub/irs-tege/rne_sum10.pdf

[Oh so SIMPLE]

Great, J4FKBC, and thanks for directing me to the Sungard and IRS pages.

Followup question: Would such a plan have already needed an interim amendment for PPA and HEART?

[John Feldt ERPA CPC QPA]

PPA Yes. HEART is due by the end of their 2010 Plan Year, so maybe, depends on their plan year.