Benefit Planning Consultants offers IRS pre-approved regional prototype retirement plans. A plan is adopted by executing an adoption agreement electing certain available options. A prototype plan can serve to either avoid or reduce the IRS user fee.
BPC's pre-approved Prototype Plans offer two kinds of adoption agreements for each type of plan:
- The Non-Standardized plan contains the full range of
choices that can be made. As a result, it offers the greatest
flexibility and widest range of plan design options that
can be used to meet the employer's objectives.
Under a non-standardized agreement, an employer can include certain employee classes, restrict coverage to only some employers in a controlled group, elect more restrictive requirements to accrue a benefit, and elect to exclude some forms of compensation.
A non-standardized plan should be submitted to the IRS for an individual determination letter to ensure that the plan satisfies all IRS qualification requirements.
In order to avoid the possible disqualification of a plan which fails either minimum coverage or minimum participation tests these plans contain a fail-safe mechanism. Under the fail-safe provision additional contributions may be required of the employer however, the qualified status of the plan will be protected.
- The Standardized plan is one which is already approved by the IRS. An individual determination letter is not required, thus minimizing the cost of the plan. These plans contain certain restrictions on plan design choices, primarily in the areas of coverage and allocation requirements. Consequently, they are less flexible but appropriate for small plans