Existing plan moves to PEP & auto enrollment

[TPApril]

If I understand correctly, an existing plan established prior to SECURE 2.0 that moves to a PEP, and in the process terminates its original plan, still gets to grandfather in not requiring auto enrollment, assuming the PEP allows some plans to carry forward this grandfathered arrangement.

On the same topic of auto enrollment and PEPs, a new small plan that would normally get a waiver from auto enrollment can still get that waiver in the PEP, again assuming the PEP allows for such flexibility.

[RatherBeGolfing]

1 hour ago, TPApril said:

If I understand correctly, an existing plan established prior to SECURE 2.0 that moves to a PEP, and in the process terminates its original plan, still gets to grandfather in not requiring auto enrollment, assuming the PEP allows some plans to carry forward this grandfathered arrangement.

We are still waiting on the final regs, but the proposed regs say that they get to keep the grandfather status.  If a grandfathered plan spins out of the PEP, the plan is "treated" as grandfathered, even though it would have a current effective date.

 

1 hour ago, TPApril said:

On the same topic of auto enrollment and PEPs, a new small plan that would normally get a waiver from auto enrollment can still get that waiver in the PEP, again assuming the PEP allows for such flexibility.

Yes

[G8Rs]

Just to confirm the rule from RatherBeGolfing's answers, you disregard the PEP when determining whether any exemptions apply. 

You said the plan is terminated, but I assume you mean only because you're filing a final 5500. If you transfer the existing assets to the PEP, you retain grandfather status because it's treated as a continuation of the prior plan. If instead, you froze the existing plan and started another plan by joining a PEP, then there is no grandfathering because it's a new plan. But the plan could be exempt if the employer meets the small employer or new business exemptions. It doesn't matter when the PEP itself was established or how large it is.