Amendment of Qualified Retirement Plans

Many employers maintain one or more qualified retirement plans for their employees. The most popular qualified retirement plan is the 401(k) Profit Sharing Plan. All qualified retirement plans are required by law to be in writing and must include numerous provisions required by the Internal Revenue Service and the Department of Labor in order to remain qualified plan status and to protect the rights of the participants. As a result of the written plan requirement, qualified plans must be amended from time to time to reflect changes in laws governing retirement plans. In some cases these are “short” tack-on amendments and in other cases the plan must be rewritten in its entirety.

Over the last ten years or so, plan sponsors have been required to adopt good-faith interim amendments to the plan to comply with many law changes. Now the Internal Revenue Service is requiring that all qualified plans be totally restated and for most plans, including 401(k) plans, the amended and restated plans must be adopted no later than the last day of the 2009 plan year. For calendar year plans, that means that the restatement must be adopted by December 31, 2009. If our firm currently maintains your qualified plan, we will be contacting you in the near future to discuss the amendment process. If we are not currently maintaining or administering your qualified plan, we would be glad to answer any questions that you may have regarding these requirements. Failure to comply with these provisions will, in all likelihood, result in the disqualification of your plan and very adverse tax consequences.

This publication is for general information only and is not intended as formal legal advice. If you have any questions or need assistance, please contact Curtis & Curtis, P.C.

Curtis & Curtis, P.C. is a full service law firm located in Jackson, Michigan providing superior legal services and advice to individuals, families and businesses throughout mid-Michigan since 1901.