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Your Solo 401(k) Plan Requires a Language Update by July 31st, 2022.

On a periodic cycle of approximately 5-6 years, all 401(k) retirement plans undergo a “plan restatement”.  During this process, the plan document is replaced with a revised version that incorporates any changes to the tax code governing retirement plans since the last cycle.

It is mandatory that all active plans undergo the restatement process.  Failure to restate your plan and operate under the current provisions of the tax code can result in severe consequences including the potential of plan disqualification and loss of tax-sheltered status.  An expensive process with the IRS is required to remedy an out of compliance plan if you miss the restatement deadline.

The administrative process to complete what is being called the “Cycle 3 Restatement” has been completed and the new plan language has been finalized.

As of February 2021, Safeguard Advisors is beginning the process of rolling out updated plans to our client base.

We are also using this event to migrate legacy clients with plan documents authored by Draneas, Huglin & Cooper, P.C. to our in house document platform so we can better administer future subscription maintenance.

Following are resources we have put together to guide you through this process.

When is the Deadline to Update?

All plans must be restated and executed by the sponsoring employer (you) by July 31st, 2022.

When Will My Plan be Updated?

Expect communication on this topic in the near future.   Our plan is to update clients in the anniversary month of original plan delivery.  This will allow us to manage the workload efficiently.

We are still fine tuning some of the systems we are putting in place to manage this process and communicate with clients.  Stay tuned.

What Does the Restatement Cost?

Plan restatements are included in your annual document maintenance subscription of $125 per year.

Delivery of digital documents will be free.

Delivery of a physical notebook will cost $75 to cover production and shipping expenses.

What Plan Document do I Have?

Plans delivered on or before April 30th, 2019 were provisioned by Draneas, Huglin, & Cooper, P.C.

Plans delivered on or after May 1st, 2019 are on the Safeguard Advisors document platform.

Plans delivered after December 1st, 2020 are already using the Cycle 3 plan document and do not need to be restated.

What if I am not Using my Solo 401(k) Any Longer?

A formal process is required to shut down a Solo 401(k) plan.  Please email support@ira123.com to let us know you want to shut down your plan.  We will send simple to follow instructions to terminate your plan.

Plans must be using the current document version when terminated, so if you plan to wind down your plan it will be to your advantage to do so before July 31st, 2022.

I Have Received an Invoice from Draneas, Huglin, & Cooper, P.C.  Should I pay it?

Before you pay an invoice please Schedule a Support Callback.  We’ll review where you are in your subscription cycle and determine the best time to restate your plan and switch you to our in-house document platform.

Can I Update my Plan Sooner?

For now, we’ll go with a maybe.  Once we get the process up and running, we can evaluate this option further.

Please email support@ira123.com if you would like to update sooner and want to get your name in the queue.

How Can I learn More?

Please email support@ira123.com to initiate requests.  Most questions are asked frequently and we can generally provide a detailed written response promptly.  If your question requires, we will have the correct resource on our team reach out to you personally.

For unique matters that require a conversation please Schedule a Support Callback.


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