JustMe Posted December 20, 2018 Posted December 20, 2018 We have a client that wants to change the allocation method of their recapture account effective 12/31/2018. Currently the service agreement (not addressed in the plan document) states that after expenses are paid from the account, the account will be reallocated pro-rata based on account balances. We have not yet seen a copy of the 404a-5 disclosure to see if it contains such details. The client wants to change the reallocation method to be based on the investments of the participants and whether those investments generate revenue sharing income. If the allocation method of the recapture account is not included in the initial 404a-5 disclosure, can the employer change the allocation method without a 30 day change notification to participants?
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