NEWSLETTERS
Volume 3,
Issue 1 ...................................................................................................................................................
February 2002
Document Restatement Update
Most plan sponsors are aware that they have to restate
their retirement plan for tax legislation enacted since 1994, collectively
known as GUST.
Administrative Retirement Services, Inc. (ARS) has
received IRS approval for our prototype plan documents. We are currently
waiting for our software company to finalize the related documents, such as
the summary plan description, before we begin sending out the restated
documents. We anticipate receiving the software update in early March and
sending out documents beginning in early April. Because of the number of
plans we administer, we anticipate this process will take several months.
ARS will continue to use the Datair Volume Submitter
Document (VSD) for cross tested plans. Datair has not received IRS approval
on their VSD but anticipates receiving IRS approval on their VSD toward the
end of the first quarter of 2002. Once Datair receives IRS approval, ARS
will contact our clients who use the VSD and begin the process of restating
those plans.
At the same time ARS restates plan documents, we will
also be preparing plan amendments for the Economic Growth and Tax Relief
Reconciliation Act passed in July of 2001 (EGTRRA).
These amendments include the following changes:
- Plan loans for S-corporation shareholders allowed,
- increasing contribution and compensation limits,
- modifying top-heavy rules
- changing required vesting schedules for employer matching
contributions,
- direct rollovers of plan distributions and rollovers from other types
of plans allowed,
- repeal of multiple use test,
- suspension period following hardship distributions is decreased,
- catch-up contributions allowed.
Please call ARS if you have any questions.
©2002 Administrative Retirement Services, Inc. |
