restatement date vs signature date

[WCC]

Plan changes service providers (bundled) on July 1, 2011. Plan was originally effective 1/1/2005. The plan documents were all up to date on July 1, 2011. New service provider restates the plan into their document. Effective date of the restatement was July 1, 2011. None of the plan provisions changed in the restatement.

Question: The plan sponsor signs the restated document on July 15, 2011. Is that a a problem? I am being told it is and told to file under VCP as a doc failure.

What if there was a change to the plan provisions (i.e. not a safe harbor plan and they add eligibility requirements)? Would a signature date two weeks later cause a problem?

thank you

[Lou S.]

Unless July 15, 2011 signature date was "late" for some statutory reason I don't see the retro active effective date back to July 1 being problematic (unless there are mid-year safe harbor issues or 411(d) cutback issues).

We've submitted plenty of restatements over the years that were retroactive to BOY and I don't recall the IRS ever questioning on DL submission or Plan audit.

[My 2 cents]

Just curious - who is telling you that the plan is in trouble? Makes a big difference if it is the sponsor's accountant or lawyer, someone from the prior service provider, someone from the new service provider, a participant's lawyer, or the IRS.

[WCC]

Just curious - who is telling you that the plan is in trouble?

new service provider says the provided document was not signed timely.

[QDROphile]

If they cannot explain in detail why they assert an impropriety, or their explanation is incorrect, get a new service provider. One cannot expect advice to be correct 100 percent of the time, but starting off incorrectly within a fundamental function of the service provider is intolerable. You should let them know they are on the spot now, so they can push the question up to someone above the clerical responsibility level.

[Bird]

Agreed, restatements retroactive to BOY are pretty much standard operating procedure. It is a really bad sign if this is how things are starting out with a new service provider.

[MoJo]

Time to find a new service provider. If NOTHING changed, AT THE WORST CASE, the new plan document became effective 7/15 when signed. SO????? The old plan document was still effective until the new document became effective - and the plan should have been operated in conformity with it's terms (since NOTHING changed). Many (idiot) service providers seem to think that it is a "new" plan when they put it on their document - and try to enforce "new plan rules" (and even then, they often get those wrong). Nonsense.

Even so, I agree that the "retroactive" aspect of this is a non-issue.

[John Feldt ERPA CPC QPA]

Nothing is changed - the new document did not do something that is not allowed, like exclude certain employees retroactively (e.g. it excludes leased employees now)?

It did not add a new safe harbor provision retroactively (e.g. safe harbor 3% now excludes HCEs)? Maybe something else more obscure in the changing of the basic document (if pre-approved plan)?

Or, was the old document a GUST document and the new document is EGTRRA? If so, they're saying the EGTRA deadline was missed?

I agree the new provider should point out the items that they believe are in violation.

[Bill Presson]

Just curious - who is telling you that the plan is in trouble?

new service provider says the provided document was not signed timely.

The new service provider that took over the plan in 2011? Or a new service provider that's getting the plan now in 2014?

If the first one, why are they now saying it's an issue 3 years later?

[WCC]

The new service provider that took over the plan in 2011? Or a new service provider that's getting the plan now in 2014?

If the first one, why are they now saying it's an issue 3 years later?

There is a new service provider now in 2014. This new provider is questioning the signature date.

[Bill Presson]

The new service provider that took over the plan in 2011? Or a new service provider that's getting the plan now in 2014?

If the first one, why are they now saying it's an issue 3 years later?

There is a new service provider now in 2014. This new provider is questioning the signature date.

Okay. Based on what you've posted, I think they're wrong.

[FormsRstillmylife]

Are they trying to say that the 2005 prototype should have been restated for EGTRRA by April 30, 2010? A 2011 restatement would not meet that timing requirement.

[austin3515]

Aha... Good point! I was jumping on the "they must be idiots" bandwagon but perhaps they are onto something...

[WCC]

Are they trying to say that the 2005 prototype should have been restated for EGTRRA by April 30, 2010? A 2011 restatement would not meet that timing requirement.

No, EGTRRA was signed timely. They are taking the stance that if there were any discretionary amendments made during the 7/1 restatement, that those cannot take effect until the date the document was signed. Nothing was changed, the restatement was due to a provider change.

[John Feldt ERPA CPC QPA]

If they cannot cite any specific provision that is in violation, then:

"they must be idiots"

I've shortened this quote based on the most recent response indicating that nothing in the plan changed.

[austin3515]

ok then they are idiots. I have a bigger problem than you because I generally make them effective 1/1!

[MJ Hartman]

I had the same issue a while back. Service provider (bundled) taking over a plan called and said the restatement for EGTRAA doc. was signed late (Feb. of 2010) and needed a VCP filing. these vendors have people who do nothing but go through a checklist and if it doesn't match up with what they see its obviously wrong in their world.