Amending Merged Plans for GUST (Posted June 8, 2003) Technical Tip 98: The following question and answer were from the IRS Employee Plans Corner website: If there are two plans that are being merged together, is it necessary to have both plans separately amended for new tax law prior to the plan merger? Response: It is the position of the Service that it is sufficient for only the "surviving plan" to be amended as long as its amendments are written to also retroactively amend the now "merged plan" to comply with the new tax law requirements. A favorable determination letter for the surviving plan may be relied upon with respect to whether the merged plans were timely and correctly amended for new tax law. With respect to current law, if two or more plans are merged prior to the end of each plan’s GUST remedial amendment period, the plans may be amended to satisfy the GUST requirements in either of two ways: Each plan can be separately amended for GUST prior to the merger; or The requirement to amend for GUST can be satisfied through the surviving plan. In this instance, the GUST amendments must be adopted within the GUST remedial amendment period of the surviving plan and the merged plan(s) (see below), and the appropriate amendments must apply to each of the plans that have been merged into the survivor. Thus, some of the amendments to the surviving plan may apply to one or more of the merged plans and not to others, or may apply at different times to each of the merged plans. This would be necessary, for example, if different choices of elections were made in the operation of the merged plans prior to the merger. For example, if the merged plan provided for a QJSA (an IRC 411(d)(6)--protected benefit) while the surviving plan did not, the surviving plan must be amended to preserve this option for benefits accrued under the merged plan. The QJSA provisions of the surviving plan should also apply to the merged plan to the extent necessary to allow the plan to comply with current law prior to its merger into the surviving plan. View all Tips © 2012 Reish Luftman Reicher & Cohen, a Professional Corporation Important notice: Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner's situation. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of your situation.