Plan sponsors using a “pre-approved” retirement plan document for their defined contribution plan (in the form of either a prototype or a volume submitter) generally must execute a plan restatement on or before April 30, 2016. The exception to that general rule applies to sponsors of pre-approved defined contribution plans adopted on or after January 1, 2016, if the plan is not adopted to restate a pre-approved defined contribution plan that the employer sponsored before January 1, 2016. For those plan sponsors, the restatement deadline is April 30, 2017. (The IRS provided that extension to facilitate plan sponsors’ ability to convert an existing individually-designed plan to a pre-approved plan.)
This required restatement is commonly referred to as the “PPA Restatement” because it must include provisions of the Pension Protection Act of 2006 (the “PPA”). However, this restatement must incorporate other law changes as well, such as changes under laws known as WRERA and the HEART Act.
As further background, pre-approved plans are purchased from a financial institution, attorney, or other qualified plan document provider. While these plan documents only permit limited customization, they give the adopting employer assurance that the IRS has approved the document’s language. That is because plan document providers who sell pre-approved plans must update the plans in their entirety once every six years and obtain a new IRS approval letter. If you or any of your clients has not received a PPA Restatement, the plan document provider(s) should be contacted immediately.
Note that even if a plan sponsor timely executed plan amendments to reflect the PPA and other laws as they became effective, the plan sponsor must still adopt a PPA Restatement.
I continue to review clients’ PPA restatements (ideally in “draft” form before they are executed), so please let me know if you have any questions in this regard.