retro adoption of a existing plan by a controlled group member

[Draper55]

We know we can retroactively adopt plans and we can also retroactively improve benefits. However, if a controlled group member wanted to retroactively join the existing plan of a related controlled group member would this fall under one of the two scenarios(i.e., IRC 401(b)(2) or (b)(3)?

[Peter Gulia]

If the plan’s sponsor and the to-be-added participating employer would do this using IRS-preapproved documents, what do those documents state or omit about how much retroactive effect might be had on a participating employer’s adoption?

This might matter because a document’s tolerance could be narrower than what Internal Revenue Code § 401(b) otherwise might permit.

Remember, for an ERISA-governed plan, one amends a plan according to the governing documents’ “procedure for amending such plan,” including its provisions “for identifying the persons who have authority to amend the plan[.]” ERISA § 402(b)(3), 29 U.S.C. § 1102(b)(3).

The Treasury’s view of Internal Revenue Code § 401(b) is 26 C.F.R. § 1.401(b)-1 https://www.ecfr.gov/current/title-26/section-1.401(b)-1.

Yet, one suspects a real-world answer to your question might be grounded in an IRS tolerance not expressed in a Treasury rule.

This is not advice to anyone.

BenefitsLink mavens likely know much more than the tiny bits I know.