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  • We adopted a written 403(b) plan in 2009. Are any updates needed?
  • We have a current determination letter, but our plan has changed. What now?
  • How do we demonstrate reasonable efforts to operate the plan in accordance with its terms?
  • Our last determination letter was from three years ago. Is our plan still in compliance?

Asking Yourself These Same Questions? Introducing Comply Now.

The tax-advantaged or qualified status of retirement plans under the Internal Revenue Code ("Code") is critically important to both plan sponsors and participants. Plan sponsors of 401(a) qualified plans, 403(b) plans and 457(b) plans face increased uncertainty and risk related to the continued legal compliance of their plan documents as the Internal Revenue Service ("IRS") has—in response to budget reductions and finite resources—significantly reduced the services historically offered to employers to aid them with compliance. For example, the IRS largely ended its determination letter program for individually designed qualified plans effective January 1, 2017, bringing to conclusion an era of cooperative compliance. The IRS had only recently announced the determination letter program would not be extended to 403(b) plans despite the fact plan sponsors received little guidance related to the qualification of their 403(b) plans in form since the 403(b) written plan document requirement became effective January 1, 2009. This new reality leaves plan sponsors vulnerable to ongoing compliance challenges.

Ice Miller's Comply Now Program is designed to address plan sponsor uncertainty and risk. Comply Now helps plan sponsors maintain compliant plans through both a plan document component and a plan operation component. Comply Now is available to plan sponsors of:
  • 401(a) plans, including defined benefit, money purchase, cash balance, profit sharing, ESOP and 401(k) plans
  • 403(b) plans, including 403(b)(1) annuity contracts, 403(b)(7) custodial accounts and 403(b)(9) retirement income account plans
  • 457(b) plans, including governmental and top hat plans

Comply Now Plan Document 

Comply Now Plan Document provides the assurance plan sponsors need for their ongoing plan document compliance concerns. 
  • Who is it for? Comply Now is available for all individually designed plans and may be used by employers of all types, including publicly traded companies, governmental employers, privately held companies, tax-exempt organizations, and church employers, to provide creditability to compliance efforts in the event of IRS audits and participant disputes and to help avoid costly corrections.
  • What will Ice Miller do? Ice Miller will identify any required amendments that need to be made to a plan sponsor's retirement plan for continued tax-advantaged or qualified status. If all required amendments are timely made by a plan sponsor, Ice Miller will issue a letter to the plan sponsor that its plan document has been updated to comply with all applicable IRS requirements for tax-advantaged status or qualification in form and any design amendments are consistent with the Code's requirements for that type of plan.
  • How much does it cost? Comply Now Plan Document is available to most plan sponsors for a flat fee. The fee is based on several factors, including whether Ice Miller prepared the current plan document, the complexity of the plan and the date of the most recent determination letter (if applicable). All services under Comply Now Plan Document are included in this flat fee.

Comply Now Plan Operation 

Operational compliance is also critical for retirement plans. If the IRS discovers an operational failure during an audit, the plan will be subject to sanctions based on the facts and circumstances of the particular failure or failures. Factors considered in determining the amount of a sanction include the steps taken by the plan sponsor to prevent failures, the steps taken by the plan sponsor to identify failures that may have occurred and the extent to which correction of a failure has progressed before the IRS began its examination of the plan.
  • What will Ice Miller do? Under Comply Now Plan Operation, Ice Miller will identify important operational guidance issues that may apply to the plan sponsor's retirement plan.  On plan sponsor request, Ice Miller will conduct focused audits of the plan's operations to determine whether common compliance issues are occurring, such as failing to follow a plan's definition of compensation, depositing employee contributions in an untimely manner, failing to comply with contribution limits, or incorrectly reporting loan repayment failures.
  • Why does my plan need this program? Ice Miller's review under Comply Now Plan Operation will not only assist a plan sponsor with identifying and correcting any operational failures, but will also be evidence of the plan sponsor's reasonable efforts to comply with the Code in actual plan operation.
  • How much does it cost? The fee for Comply Now Plan Operation will be based on the complexity of the retirement plan, scope of the operational issues that will be reviewed and availability of plan sponsor resources to support the review. In many cases, these services can be provided for a flat fee.

Take Steps to Comply Now

While a letter issued under Comply Now is not binding on the IRS, Department of Labor or other third parties, it will serve a critical role in demonstrating good faith efforts by a plan sponsor to continue to maintain its retirement plan's tax-advantaged or qualified status in both form and operation.

For more information about Comply Now or to participate in Comply Now, contact your Ice Miller Employee Benefits attorney, or if you do not have a regular Ice Miller Benefits Attorney, please contact directly:

Rob Gauss Tara Schulstad Sciscoe Chris Sears

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