Unsigned Adoption Agreement

[Spencer]

While gathering information for a new takeover client, we have discovered that their adoption agreement (sponsored by the investment company) from 1993 was never signed and executed. The original effective date of the plan was 1988 and they do have a signed document establishing the plan. However, since 1993 it seems the plan has been operating without a document.

I have never experienced such a problem and am at a loss as to how we correct. Do we use Walk-in CAP?

[rcline46]

The investment company must have the document on file. If they don't then they are guilty of malpractice, and possibly a fiduciary breach because they are treating it as a qualified plan when it isn't.

1. Get to the compliance department of the investment house and explain what you need. They are VERY sensitive to exposure while the sales offices don't care.

2. Get after the client. If they can't produce anything (remember that last item had to be dated in 1994 unless a special extended period) insist on non-amender CAP. Its really not too expensive.

[Bill Berke]

I agree with rcline46. You can look up Attardo v. Commissioner, a tax court case where poor Mr. Attardo signed the document but forgot to sign the trust and his plan was disqualified. The investment house lawyers are far more sensitive and aware of the ramifications than any local office.