Plan Amendment

[Nassau]

If a plan document is amended, am I correct that the plan sponsor has to the end of the plan year to amend the plan document. Can someone tell me where it states the timing in the Code/Regulations?

[ETA Consulting LLC]

1) You must follow the terms of the plan.

2) You may not retroactively amend a plan to conform to an operation.

Exceptions: When the plan's provisions are inconsistent with the Treasury Regulations, then you must adhere to the Regs. Typically, when the law changes, the IRS will allow to you to operate the plan under the new rules while amending the plan at a later point in time. Several EPCRS items will allow you to retroactively amend the plan to conform to an operation.

Keep in mind that exceptions are just that; exceptions. You will, generally, not want to arbitrarily operate the plan differently while amending later.

Good Luck!

[Everett Moreland]

See Revenue Procedure 2007-44, section 5.05