Why doesn’t our Plan Document account for the new provisions?
Blue Chip ensures your plan is in compliance with all legislation, but typically amendments to take into account legislative changes come long after the Plan is operationally using a provision. When Congress passes new laws, they typically provide for a period of operational compliance with the need to amend sometime in the future. This is done to allow the IRS/DOL time to interpret the new laws and create regulations and for technical corrections to be passed to fix unintentional changes the new legislation created. It also allows document providers time to write amendments.
SECURE passed in late 2019, CARES passed in early 2020 and SECURE 2.0 in late 2022. Plan sponsors have until the end of 2026 to amend their plans for both the required provisions of these laws and how the plan handled the optional provisions of these laws. These amendments will be separate from the actual current plan document.
Blue Chip utilizes a checklist within our document software to track the various optional provisions and when a client has started using them in their plans. This will make the amendment process in 2026 much smoother vs asking the sponsors to let us know what they did with optional provisions dating back as far as 2019.
Plan Documents themselves are required to be completely updated every 6 years as well. The next cycle of restatements will begin late in 2026 and go through 2028. At that time many of the amendments to your plan will no longer be needed as those provisions will be included in the new Cycle 4 Plan Document. However since those documents are already in the review process with the IRS there will still be some provisions of SECURE 2.0 that will be in a separate amendment as some provisions were not a part of the required provisions in the Cycle 4 documents.
If you have any questions about your plan provisions or about implementing any new options please contact your Compliance Consultant.
401(k) Plan Investments in Cryptocurrencies
In 2022 the Department of Labor’s Employee Benefits Security Administration gave guidance that discouraged Employers from including crypto currencies in their plans as an investment choice. This topic has become front and center recently and now the DOL has backed-off of that guidance.
Historically, the DOL has taken a neutral stance on decisions that are fiduciary based investment decisions and stuck to the “prudent man rule” and doing what is best for the participants. The decision to rescind the 2022 guidance puts them back into that position; they now neither endorse nor disapprove of plan sponsors offering this as an investment option. However, the institutional recordkeepers will need to weigh in on this matter at some point to determine if they would allow crypto currency as a viable option in the plan’s investment menu. Please contact your plan’s investment professional for any questions you have regarding this topic.
IRS Form 5500 and 5500-SF Due Date Reminder
The Form 5500 (or 5500-SF) is filed annually with the Department of Labor to report the financial condition and general operational compliance of a retirement plan. The form is due on the last day of the 7th month after the plan year end. A Plan may request an extension that will allow an extra 2 ½ months after the initial due date of the Form 5500. For example, if your Plan is based on the calendar year your 5500 is due July 31st without extension or October 15th with extension of the following year. We send out a request for year-end information during the last month of your plan year. Please work with your Compliance Consultant to make sure we receive your information timely to avoid any delays in preparing the Form 5500 for your Plan.
Meet the Staff
Diane Schwartz – Compliance Consultant
Diane has over 40 years of experience in Pension and Retirement Plan experience. She lives in rural southern Wisconsin and has worked with defined benefit, money purchase, and 401(k) profit sharing plans. Diane holds degrees in both Accounting and Business Administration as well as earning her QKA and QPA credentials from ASPPA. In her off time, Diane enjoys playing and watching sports. She is a season ticket holder for UW-Madison Women’s hockey team and loved being there at the 2025 Frozen Four and seeing the team win their 8th NCAA championship in March.