Is this a mandatory thing or is it optional?
This is a Government mandated restatement, it is not optional.

Why is this cost not built into my normal fee agreement?
This is an option that we have considered in the past, but the current structure makes more sense for a variety of reasons. We never know exactly when the restatement cycle will begin, so charging a monthly fee may not be fair. Some clients may leave in the middle of a cycle and therefore not need the restatement when it comes due, this would mean they paid for something that they never received. The most logical solution is to charge this fee at the time of restatement.

Why does PDC invoice clients before they have completed the actual Restatement?
We do this to ensure that our clients are committed to having PDC handle the restatement. This is a very common TPA practice. Receiving payment before makes sure that all the efforts that go into the restatement won't be wasted time that takes away from other important client services.

Do all vendors charge this type of fee?
It can vary based on the type of vendor, but the great, great majority of Third Party Administration firms charge for this service.  Bundled Recordkeeping vendors may not charge in some situations but this is because they generate large revenue from asset based fees.  When determining what PDC would charge for this service, we looked at all of our peers and the average fee represented. Our fee is definitely competitive and within industry norms.

Who do I contact if I have more detailed questions?
Your Client Account Manager has in-depth knowledge of this restatement process and can answer any questions that you may have.   

What is a plan restatement?
A restatement is a re-writing of the adoption agreement. It incorporates changes from any plan amendments that may have been adopted since the last time the document was re-written. Retirement plans must be restated from time to time; however, they are divided into various cycles depending on plan type and document type.

Why do we have to restate our plan?

Documents are written based on laws and regulations set by Congress, the IRS and the DOL. As those laws and regulations change, documents must be updated to mirror those changes.


What is the restatement deadline?
The restatement deadline for 403(b) plans is March 31, 2020 and the deadline for Cash Balance Plans and Defined Benefit Plans is April 30, 2020.

Can we pay for the restatement from plan assets?
Yes. Since the current plan document restatement is required to maintain the plan’s tax-qualified status, the Department of Labor allows the fee to be paid out of plan assets

Do I have any options or flexibility with regards to this fee?
Although we cannot negotiate or lower this fee, we are very willing to “work with” our valued clients and offer flexible options in terms of payment structure. Please contact our Accounts Receivable Department at accounting@plandesign.com or 650-425-7925 to discuss options.