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5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.
The IRS has issued two sample plan amendments in IRS Notice 2009-65 that will enable employers to add automatic contribution features to their 401(k) plans. Sample Amendment One may be used to add an automatic contribution arrangement to a 401(k) plan. Sample Amendment Two may be used to add an eligible automatic contribution arrangement (authorizing withdrawals of elective deferrals) to a 401(k) plan.
CCH Note: Plan sponsors are not required to implement an automatic contribution arrangement or to adopt either amendment. In addition, neither amendment substantively changes or affects governing law, but are merely designed to facilitate the implementation of automatic contribution arrangements, as a means of enhancing the retirement security of employees who might not otherwise make plan contributions.
Amendments will not affect pre-approved status
A plan sponsor is not required to adopt either amendment verbatim, but may modify an amendment to conform to their plan's terms and administrative procedures. In addition, the adoption of either sample amendments (as modified) will not result in the loss of reliance on a favorable opinion, advisory, or determination letter. Nor will the adoption of the amendment affect the pre-approved status of a pre-approved master and prototype or volume submitter plan.
Time periods for adopting amendments
The IRS advises that plan sponsors wishing to adopt an amendment must do so by the later of: (1) the end of the plan year in which the amendment is effective (pursuant to the deadline for adopting a discretionary amendment set forth in Rev. Proc. 2007-44, Sec. 5.05(2)); or (2) the last day of the first plan year beginning on or after January 1, 2009 (2011 for governmental plans), as specified in section 1107 of the Pension Protection Act of 2006 (P.L. 109-280).
CCH Note: The IRS cautions employers that they must provide the required notice advising employees of the features of the plan as amended within a reasonable period of time before the amendment is effective.
The employer needs to evidence timely adoption of the amendment with a written document. The document must be signed and dated by the employer, including an adopting employer of a pre-approved plan.
For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.
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