As 2016 comes to an end, we are pleased to present you with our traditional End of Year Plan Sponsor “To Do” Lists. Like last year, we are presenting our “To Do” Lists in three separate Employee Benefits Updates. Part 1 of the series covered executive compensation issues, Part 2 covered health and welfare plan issues, and Part 3 covers qualified plan issues. Each Employee Benefits Update provides you with a “To Do” List of items on which you may want to take action before the end of 2016 or in early 2017. As always, we appreciate your relationship with Snell & Wilmer and hope that these “To Do” Lists help focus your efforts over the next few months.

For your convenience, we have broken the “To Do” List into five categories.
(Accessible via the menu on the left)

All Qualified Plans “To Do” List

• Adopt Design Changes by the End of the Plan Year: If an employer made any design changes during the year, the plan generally must be amended to reflect those design changes by the last day of the 2016 plan year (i.e., December 31, 2016 for calendar year plans).
• Adopt Plan Restatement if in Cycle A: If a qualified plan is individually designed and falls in Cycle A (i.e., the employer identification number associated with the plan ends in 1 or 6 or certain plans that made a controlled group or affiliated service group election to be in Cycle A), the plan must be restated and submitted for a determination letter on or before January 31, 2017. The IRS announced that it is eliminating its five-year staggered determination letter cycle for individually designed retirement plans, so Cycle A plans are the last cycle to take part in this program. See our August 2, 2016 SW Benefits blog post for more information.
• Update Summary Plan Description if Needed: Summary Plan Descriptions (SPDs) must be updated once every five years if the plan has been amended during the five-year period and once every 10 years for other plans.
• Consider Compliance with Department of Labor’s Fiduciary Rules: Earlier this year, the Department of Labor finalized its fiduciary conflict of interest regulations. These regulations expand both who is considered a fiduciary and what may be considered advice under ERISA. The final rules do not become effective until April 10, 2017. Certain other provisions do not apply until January 1, 2018. In the meantime, employers should consider reviewing existing relationships to determine whether service providers are fiduciaries and whether employers need to make any changes to these relationships in light of the new rules.
• Review 2017 Plan Limits: Become familiar with the 2017 plan limits. See our November 2, 2016 SW Benefits blog post for more information.

Section 401(k) Plans “To Do” List

• Comply with Items on All Qualified “To Do” Plans List: The items on the All Qualified Plans list also apply to Section 401(k) plans.
• Provide Section 401(k)/401(m) Safe Harbor Notice by December 2, 2016 for Calendar Year Plans: As a reminder, if a plan has a Section 401(k)/401(m) contribution safe harbor, an employer must provide the safe harbor notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Annual Automatic Enrollment Notice by December 2, 2016 for Calendar Year Plans: If a plan has an automatic contribution arrangement, an eligible automatic contribution arrangement (EACA), a qualified automatic contribution arrangement (QACA), or any combination thereof, an employer must give an annual automatic enrollment notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Annual Qualified Default Investment Alternative (QDIA) Notice by December 2, 2016 for Calendar Year Plans: If an employer is relying on the QDIA safe harbor, it must give an annual notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Participant Fee Disclosure Information: Plans are required to provide to participants and beneficiaries on an annual basis a comparative chart of detailed investment-related information about the plan’s designated investment alternatives. Department of Labor guidance requires this information to be provided at least annually.
• Provide Participant Benefit Statements: Defined contribution plans must provide individual benefit statements at least annually, although plans that permit participants to direct the investment of their accounts must provide the statement at least quarterly. Defined contribution plans also must provide the statement upon request.
• Distribute Summary Annual Report: Employers should distribute a summary annual report, which is a summary of the information reported on the Form 5500. The summary annual report is generally due nine months after the plan year ends. If the Form 5500 was filed under an extension, the summary annual report must be distributed within two months following the date on which the Form 5500 was due.
• If Adding Qualified Automatic Contribution Arrangement or Eligible Automatic Contribution Arrangement for 2017, Adopt Amendment Before the 2017 Plan Year: Neither a QACA nor an EACA may be adopted mid year. Accordingly, if an employer wishes to add a QACA or an EACA to its plan for the 2017 plan year, it must adopt an amendment by December 31, 2016 for calendar year plans.
• Consider Amendments to Safe Harbor Plans: This year the IRS issued guidance that increases an employer’s ability to make mid-year changes to a safe harbor plan. Mid-year amendments still are limited and in many cases will require an updated safe harbor notice. To the extent an employer wants to make changes to a safe harbor plan, it should consider doing so before year end and, depending on the change, before providing the safe harbor notice described above. For additional information on permissible mid-year changes to a safe harbor plan, see our February 22, 2016 SW Benefits blog post.

Defined Contribution Plans (Other Than Section 401(k) Plans) “To Do” List

• Comply with Items on All Qualified Plans “To Do” List: The items on the All Qualified Plans list also apply to defined contribution plans.
• Provide Annual Qualified Default Investment Alternative (QDIA) Notice by December 2, 2016 for Calendar Year Plans: If an employer is relying on the QDIA safe harbor, it must give an annual notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Participant Fee Disclosure Information: Plans are required to provide to participants and beneficiaries on an annual basis a comparative chart of detailed investment-related information about the plan’s designated investment alternatives. Department of Labor guidance requires this information to be provided at least annually.
• Provide Participant Benefit Statements: Defined contribution plans must provide individual benefit statements at least annually, although plans that permit participants to direct the investment of their accounts must provide the statement at least quarterly. Defined contribution plans also must provide the statement upon request.
• Distribute Summary Annual Report: Employers should distribute a summary annual report, which is a summary of the information reported on the Form 5500. The summary annual report is generally due nine months after the plan year ends. If the Form 5500 was filed under an extension, the summary annual report must be distributed within two months following the date on which the Form 5500 was due.

Defined Benefit Plans “To Do” List

• Comply with Items on All Qualified Plans “To Do” List: The items on the All Qualified Plans list also apply to defined contribution plans.
• Consider Hybrid Plans Amendments: In September 2014 and November 2015, the IRS issued final regulations on hybrid plans, which are effective for plan years that begin on or after January 1, 2017. Employers should review their hybrid plans to determine whether they must make any amendments prior to January 1, 2017. A hybrid plan that uses an interest crediting rate that is not permitted under the final hybrid plan regulations may be amended prior to the first day of the first plan year that begins on or after January 1, 2017 to change the interest crediting rate without violating the anti-cutback rule if certain requirements are met.
• Post Portions of Form 5500 on Company’s Intranet: A plan sponsor of a defined benefit plan that maintains an intranet website for the purpose of communicating with employees (and not the public) is required to post portions of the defined benefit plan’s Form 5500 on the intranet. The Department of Labor has not yet issued guidance regarding the timing of such posting. However, the Department of Labor is required to post Form 5500 information on the Internet within 90 days following the date on which the Form 5500 is filed. A plan sponsor should try to post the information as soon as possible following the date on which it files its Form 5500. In the event of a delay, until the Department of Labor issues formal guidance, the plan sponsor reasonably could take the position that it has up to 90 days following the date on which it filed its Form 5500 to make the posting, which is consistent with the time period the Department of Labor is given to post Form 5500 information.
• Comply with Annual Funding Notice to Participants: Single employer defined benefit plan sponsors must provide participants with an annual notice of the plan’s funding status within 120 days of the end of the plan year to which the notice relates. Plans with fewer than 100 participants do not have to provide the notice until the Form 5500 annual report is due for the plan year.
• Comply with Participant Notice Requirement if Adjusted Funding Target Attainment Percentage is less than 80 Percent: In addition to the annual funding notice described above, Section 101(j) of ERISA requires a plan administrator to provide a notice to participants if the plan is subject to any restrictions on the payment of benefits. These restrictions become applicable if the plan’s adjusted funding target attainment percentage is less than 80 percent. Plan administrators are not required to provide this notice to participants and beneficiaries who are in pay status.
• Provide Participant Benefit Statements: Defined benefit plans should provide individual benefit statements every three years or upon request. Alternatively, defined benefit plans may satisfy the requirement by annually notifying participants that the pension benefit statement is available and how they may obtain such statement.
• Provide Suspension of Benefits Notice, if Applicable: If required by the terms of the plan, plan administrators must provide notice of the suspension of benefits to participants who continue employment beyond normal retirement age and to rehired retirees. This notice should be given during the first month during which the benefit is suspended.

Section 403(b) Plans “To Do” List

• Adopt Design Changes by the End of the Plan Year: If an employer made any design changes to the plan during the year, it generally must amend its plan to reflect those design changes by the last day of the 2016 plan year (i.e., December 31, 2016 for calendar year plans).
• Update Summary Plan Description if Needed: SPDs must be updated once every five years if the plan has been amended during the five-year period and once every 10 years for other plans. If a Section 403(b) plan is subject to ERISA, the SPD may need to be updated.
• Provide Safe Harbor Notice by December 2, 2016 for Calendar Year Plans: As a reminder, if a Section 403(b) plan uses an ACP contribution safe harbor, an employer must provide the safe harbor notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Annual Automatic Enrollment Notice by December 2, 2016 for Calendar Year Plans: If a Section 403(b) plan is subject to ERISA and has automatic deferrals, an employer must give an annual automatic enrollment notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Annual Qualified Default Investment Alternative (QDIA) Notice by December 2, 2016 for Calendar Year Plans: If a Section 403(b) plan is subject to ERISA and an employer is relying on the QDIA safe harbor, it must give an annual notice at least 30 days, but not more than 90 days, before the beginning of each plan year (i.e., December 2, 2016 for calendar year plans).
• Provide Participant Benefit Statements: Section 403(b) plans that are subject to ERISA must provide individual benefit statements at least annually, although plans that permit participants to direct the investment of their accounts must provide the statement at least quarterly. Plans must also provide the statement upon request.
• Distribute Summary Annual Report: Section 403(b) plans that are subject to ERISA must distribute a summary annual report, which is a summary of the information reported on the Form 5500. The summary annual report is generally due nine months after the plan year ends. If the Form 5500 was filed under an extension, the summary annual report must be distributed within two months following the date on which the Form 5500 was due.
• If Adding an ACP Contribution Safe Harbor for 2017, Adopt Amendment Before the 2016 Plan Year: ACP contribution safe harbors may not be adopted mid year. Accordingly, if an employer wishes to add an ACP contribution safe harbor to its Section 403(b) plan for the 2016 plan year, it must adopt an amendment by December 31, 2016 for calendar year plans.
• Comply with Form 5500 Reporting Requirements: As a reminder, effective for plan years beginning on or after January 1, 2009, Section 403(b) plans subject to ERISA must comply with standard Form 5500 filing requirements, including an annual plan audit for large plans (i.e., plans with 100 or more participants) and detailed financial information for small Section 403(b) plans (i.e., plans with fewer than 100 participants).