EGTRRA VS. PPA CHECKLIST. Numbering is for PPA 401(k) volume submitter (prototype format or IDP format)

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Arron Pitts
5 years ago
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1 EGTRRA VS. PPA CHECKLIST Numbering is for PPA 401(k) volume submitter (prototype format or IDP format) A. General Information a. Limitation Year (A5.a) added Other b. Simple 401(k) (A.11a) [moved from section C] c. Compensation (A.15b) i. Added Other determination period ii. Added option to include other compensation iii. Rearranged to be more fluid d. Statutory Compensation (A.19) old Testing Compensation e. Definition of Disability added Other (A.21a) f. Misc. items moved to section J (date for cover of SPD, File Number, Trust EIN and User Defined Fields) B. Eligibility a. Opt Out volume submitter only (no change B.5) b. 5-Year maximum in counting service with non-affiliated employers (no change - B.6a) c. Optional modifications to Rule of Parity and Hold Out (B.7c) d. Eligibility Computation Rules (hours of service only) moved to end of section and new option to make modifications to the rules e. Minimum Age (B.9) now a fill-in box rather than set choices (in all sections) f. Minimum service (B.10a) Elections Changed to help clarify timing (in all sections) i. Specified months now select hours of service, elapsed time or consecutive ii. New "other" option g. Matching Eligibility (B.13) new options i. Same as Electives 1

2 ii. Pursuant to Safe-harbor (Section C) - safe harbor match plans must choose pursuant to safe-harbor h. Profit Sharing Eligibility (B.18) new options also i. Same as Electives ii. Same as match iii. Pursuant to Safe-harbor (Section C) C. Safe-Harbor/Elective Deferral Contributions a. Added QACA safe harbor option with Follow-up Notice (C.1a) b. ADP/ACP - QACA or "ADP/ACP" (C.1b) c. Rearranged Safe Harbor Eligibility Section (C.2) Safe Harbor Rules i. New Other option to exclude certain employees (C.2a) ii. Offset (C.2f) d. Elective Deferrals i. New minimum Dollar Amount option added (C.3a) ii. Maximum now open box instead of election for more flexibility (C.3b) iii. Other limitations option added re HCEs maximum (C.3e) iv. Catch Up Moved (C.5) (options regarding matching catch-ups moved to D.5a) e. Auto Enrollment divided into Traditional and QACA i. Traditional automatic enrollment can be set up per administrative policy ii. delay option added (C.6c.i) iii. Applies to whom? Other added iv. Can select ROTH option for automatic contributions (C.8b) f. EACA broken out into separate section (C.9a) g. ADP/ACP testing elections broken into separate sections h. Voluntary contribution minimums/maximums now text boxes instead of drop-downs D. Match and Profit Sharing Contributions broken out into separate section (D) 2

3 a. Last Day/Hrs Questions wording clarified (allocation service) - OR option last b. Hours Computation broken out and clarified c. Match Inclusions (D.5) i. Catch-Up (new placement) ii. Roth (new) d. New match formula of "Three rates" e. Additional Discretionary Match election clarified (D.7) i. Safe Harbor language of not to exceed total 6% is in AA and BPD. ii. Maximum can be entered in D.10 for plans other than safe harbor f. Various Formulas broken into separate sections for easy reading. g. New option: Set a Fixed PS amount by Percentage or Amount or Other (D.17a) - assume most plans will leave as Discretionary h. Allocation allows for Other fixed formula (D.18a) i. Allocation Time and Max in separate section j. Collectively bargained employee allocations (D.24) i. new "other" offset option k. Prevailing Wage Elections (D.25) - moved to one section i. Regular PS and QNECs ii. "other" offset options iii. Options to exclude certain participants from receiving prevailing wage l. QNEC formula and allocation rules removed from checklist (volume submitter plans only). Option to describe limitations, conditions and/or special rules. m. Add own specialty language regarding 415 corrections because of the required aggregation of multiple plans. (D.30) E. Vesting a. 5-years maximum prior service re non-affiliated employers (E.4a - no change) 3

4 b. E.7 special vesting rules option (no change) c. Different schedule election for non-safe harbor match (E.9 - clarified) d. Other schedules options (E.12a) e. Pre-2007 vesting retained option (E.12c) f. Use of Forfeitures allows special specified uses or default "Any permissible method" (E.13) F. Distributions a. New Normal and Early retirement date options (default to same as age) b. NRA/ERA in-service options moved to section G c. Medium of distributions added Other option d. If select "other distribution option note that you can clarify if QJSA applies for forms/spd at J.93 (J.93 will not apply if default form of payment is QJSA since all accounts already subject to QJSA) i. J.93 can also be used to clarify which transfer account is subject to QJSA if F.7 applies e. Beneficiary may elect portion as annuity (F.6b) f. New section on Beneficiaries (F.10) i. "Other" death benefits may be specified (standard will go to spouse first then children, then estate) ii. Automatic beneficiary revocation option iii. New Option: Domestic Partners treated as spouse (to extent permitted by the Code) iv. One-year rule new option g. Cash-Outs over $5,000 i. Later of Age 62 or NRA ii. 70-1/2 G. In-Service and Loans a. if selected accounts is selected (hardship, specified age, etc.) new option to describe "other account" b. Hardship 4

5 i. New more flexible hardship option for permitted accounts (non-safe harbor match, profit sharing) ii. New option to describe other limits on hardship c. New option for specified age and service d. Transfer Account at Age 62 (G.10) e. Upon Disability (G.11) f. Other conditions, limitations and/or special rules (G.12) g. In-Plan Roth Rollovers expanded elections: specify the age requirement if all distributions permitted under code is elected (G.13) h. In-Plan Roth Rollovers of amounts not otherwise distributable (new - G.14). Appears as addendum (good faith amendment) i. Loans i. Base Plan universally permits by Plan Administrator Policy ii. Policy features based in Section J H. Plan Operations/Trust/Top-Heavy combined under Section H a. Plan Administration indemnification Per Outside Agreement replaces Custom (H.4c) b. Modifications of applicable duties (H.4d) - may be used to reallocate duties between the Plan Sponsor and the Plan Administrator. It may also be used to designate additional parties to perform specific Plan Administrator and/or Plan Sponsor duties. c. Use of BPD Trust election expanded (H.5a) i. Re only certain assets ii. Not applicable - assets are held solely by an insurance company d. Trustee type expanded to include mix of Corp/Indv. (H.5b); allow up to 20 trustees to be listed e. Name of Trustee responsible to determine/collect contributions (H.5f) f. Trust Administration Modifications (H.6) g. Contractual Statute of Limitations (H.7) - volume submitter only 5

6 h. Top-Heavy Allocation Other added (H.8a) i. Additional Language re 416 because of the required aggregation of multiple plans (H.11a-b) I. Custom language/custom effective dates a. unchanged b. custom language is treated as a document modification by IRS (even if language could fit in the checklist) c. Custom effective dates are not a modification (if used appropriately) J. Administrative Options affects SPD/Policies/Notices NOT Plan document a. Customize Terms i. elective deferrals ii. "company" iii. safe harbor nonelectives b. Additional adopting employers/entities i. joinder, consent or signatures added to document ii. Add Custom Language to Joinder Agreement/Consent iii. joinder must be used if MEP c. Allows for separate signature pages d. Loans Administration Elections Expanded (J.30-40) e. Loan Procedures Form Elections Added (J.50-60) f. Can now separate QDIA Notice from Annual Notice g. "Maybe Not" safe harbor option added (J.76) - note that safe harbor match may only use this beginning in 2015 h. General SPD (J.90-95) i. customize term for "Company" ii. amendments made to document iii. customize how QJSA applies to plan (partial, certain accounts, etc.) iv. customize plan admin address i. SPD Custom Language (J ) substantially expanded 6

7 i. options to specify placement of the language and customize a sub-heading ii. If custom death benefits are used, option to use different language for purposes of the SPD iii. option to remove QNEC language from SPD (J.110a) j. Plan Expenses expanded to include Affected Participant Only i. up to 3 custom expenses k. DB(k) Plan info deleted 7

Prototype Non-Standardized Money Purchase

Prototype Non-Standardized Money Purchase Company Data: Company Information: 1. Name of adopting employer (Plan Sponsor): 2a. Plan Sponsor address line 1: 2b. Plan Sponsor address line 2: 3. Plan Sponsor