Is anyone moving forward with amending plans to eliminate optional for

[EGB]

Is anyone moving forward with amending plans to eliminate optional forms of distributions in accordance with the newly-finalized regulations without waiting for approved language (LRMS) from the IRS? It seems like a fairly easy change to do without approved language (ie, simply eliminate the option with the effective date stated in the regs - earlier of 90 days after notice or first day of second plan year after amendment is adopted). I have clients that have J&S annuities in 401(k) and profit sharing plans that are very eager to get rid of them immediately. Obviously, waiting on approved language is the safetst approach, but I do not feel terribly uncomfortable with amending without the approved language.

Another issue: Will the IRS issue a DL on a plan that has been amended to eliminate an optional form of distribution in accordance with the new regulations now, or will it only issue a letter once LRMs are out? If no DLs will be issued yet, this would be a reason to wait on the approved language.

Last, when are LRMs expected to be issued?

[rocknrolls2]

As a prototype sponsor, we are moving to restate our prototype documents for GUST and the elimination of optional benefit forms. We are also adding language for the two types of elective transfers, which we are calling, distribution elective transfers and elective plan transfers.

As an employer, my company is looking at what options it wants to eliminate, considering utilization statistics, among other reasons.

As for the DL, I expect IRS will issue a new Rev Proc stating what they plan to do in this instance.

As for the LRMs, the LRMs were lasted updated in February. Although it is possible the IRS will issue new LRMs for the anti-cutback relief for DC plans, there are no guarantees.

I hope this helps.

[Guest Lisa Lattan]

Many employers seem eager to eliminate optional forms of benefit, particularly in conjunction with their GUST restatements. Like the sender of the email reply preceding this one, I'm skeptical that the IRS will issue LRMs on this topic. I think I'd be comfortable amending a plan without waiting to see if LRMs are issued. I'm eager to hear others' thoughts on this topic.

[rcline46]

We are amending all plans eligible to remove the annuity options. Many will be done with the GUST II restatement.

We are providing an SMM or SPD with the removal.