INTERIM AMENDMENTS

What interim amendments are needed for 2012 for ongoing Defined Contribution (DC) plans?

There are no interim amendments needed for ongoing DC plans in 2012. The last interim amendment required was the 2010 supplemental HEART-WRERA amendment (reflecting IRS Notices 2010-15 and 2009-82, respectively). An amendment is not needed as a result of (1) IRS Notice 2012-6 (relating to group trusts holding assets of Puerto Rican participants), (2) Revenue Ruling 2012-3 (explaining the application of the joint and survivor annuity rules to the purchase of certain deferred annuity contracts), and (3) IRS Notice 2011-19 (SunGard ESOPs incorporate by reference the definition of "readily tradable on an established securities market").

What amendments are needed for ongoing Defined Benefit (DB) Plans?

All defined benefit plans must adopt a Code §436 interim amendment by the last day of the 2012 plan year (IRS Notice 2011-96). SunGard provided a good-faith amendment to customers who have the Prototype Maintenance Plan (PMP), Relius Documents system, Pension Library, or ERISA Forms. See below for information regarding a terminating DB plan.

Where can I obtain the interim amendments?

If you are a subscriber to our plan document products or the Pension Library which includes the ERISA Forms and you did not receive a link to the interim amendments, please contact Client Account Services at 800-326-7235, option 6. For more details and/or to subscribe to the Pension Library/ERISA Forms products, click here.

Are any amendments needed in 2012 for 403(b) plans, 457(b) plans or nonqualified (409) plans?

No. There are currently no amendments required in 2012 for ongoing 457(b) plans.

Are amendments needed in 2012 for Cafeteria Plans?

An amendment is technically not needed in 2012, but one may be needed in 2013. If a cafeteria plan includes a health care flexible spending account (health FSA) with a limit over $2,500, then effective with the first plan year beginning in 2013, the limit must be reduced to no more than $2,500. In such case, an amendment is not required to be adopted until December 31, 2014. While plans must operate in conformance with the law, plan sponsors have until December 31, 2014 to adopt the amendment (see IRS Notice 2012-40). Many employers want to amend their plans now and SunGard has made an amendment available here.

What amendments are needed in 2012 for Self-funded Health Plans?

No amendments are needed in 2012. However, plans are required to provide covered individuals with a Summary of Benefits and Coverage. This document is available as part of the Relius Document system.

RESTATEMENTS

What are the deadlines for the restatement of qualified plans?

Currently, pre-approved DC and DB plans should have been updated for EGTRRA. The IRS has not announced the next deadline for employers to restate pre-approved defined contribution plans for HEART, PPA, WRERA, and other post-EGTRRA issues. We expect the restatement period will be from 2014 to 2016 but will notify you when there are further updates.

Cash balance defined benefit plans and ESOPs are individually designed plans, which are on the five year remedial amendment period cycle. The current cycle is Cycle B (generally for employers with EINs ending in 2 or 7). Cycle B restatements are generally due by January 31, 2013. Certain multiple employer plans may also be on Cycle B.

The IDP formatted volume submitter checklists and the prototype transmittal and supporting forms checklists are available online. You can use either our Service Bureau or our On Demand service.

TERMINATING PLANS

Do I need to amend a terminating plan?

Yes. All plans that are terminating must be amended at the time of termination to reflect all applicable qualification requirements then in effect. This means the plan must have all relevant interim amendments. In addition, we have provided a termination amendment to address certain other issues that apply to terminated plans (such as cessation of contributions or accruals).

The 2012 DC termination amendment has not changed since the 2010 DC termination amendment. The 2012 DB termination amendment, however, has been updated. Sponsors of DB plans should separately adopt the Code §436 amendment (described above for ongoing plans). However, if the employer is not submitting the plan to the IRS upon plan termination, then consider using the IRS sample amendment from IRS Notice 2011-96 instead of the amendment provided by SunGard. An employer with an ongoing plan can rely upon the IRS sample amendment. The IRS would probably not question the language if the terminated plan is audited.

FAILURE TO TIMELY AMEND OR RESTATE

What do I do if an employer has not timely adopted all interim amendments or timely restated its plan?

The failure to adopt interim amendments or restate is considered a plan document failure. It can only be corrected using the voluntary compliance program (VCP) set forth in Rev. Proc. 2008-50. We do NOT handle VCP submissions so you should contact an advisor if you have questions regarding this IRS program. The IRS has a summary of the VCP program as it applies to DB non-amenders along with links to online fillable forms, here. There is also a helpful VCP Submission Kit for DB nonamenders.

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ERISA Workshop – 4 Cities Left - Register Now
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Plan Corrections Workshop: When Good Plans Go Bad – January 2013 – 19 Cities
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Orlando Advanced Pension Conference – February 6-8, 2013
Just for ERPAs Workshop, Orlando, FL – February 5, 2013
Registration is now open, here: www.relius.net/Events/seminardetail.aspx?CID=26043

Upcoming Web Seminars: featuring
Fundamentals of 401(k) Plans – 12-part Web seminar series, November thru December. Titles of the 12 segments: eligibility; vesting; identifying HCEs and key employees; coverage testing; 401(k) testing - ADP, ACP, and catch-ups; introduction to nondiscrimination testing; top-heavy testing; compensation; 415 limit and deductible contributions; taxation and distribution; controlled groups; plan loans. Bundled registration price is available. This series will be repeated in January 2013.

Making Sense of Required Minimum Distributions, December 6, 2:00 p.m. ET
Safe Harbor 401(k) Plans, a 3-part program, December 11-12-13, 12:00 p.m. ET each day (earlier start time)
Ethics: A Case Study Approach, December 13, 2:00 p.m. ET
1099-R: An Ongoing Challenge, December 18, 2:00 p.m. ET
Keeping Current, December 20, 2:00 p.m. ET

Visit our Web site at www.relius.net/Events/events.aspx?Web for more details and to register online.