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Managing Your Account

Everything You Need to Know About Solo 401(k) Restatements

Certain Qualified Plans (including profit-sharing, money purchase, 401(k) and governmental 401(a) plans) must be updated occasionally in accordance with IRS regulations. 

Pre-approved plans, including your NDTCO Solo 401(k), must be restated every six years to retain their qualified status. 

To ensure correct compliant measures are met by NDTCO on your behalf, we kindly ask that you restate your NDTCO Solo 401(k) plan by July 31, 2022.

To restate your plan, please review the plan document and sign the Adoption Agreement on the last page of the plan document.

In most cases, the Employer and Trustee are the same, and a signature is needed in both spots.

Frequently Asked Questions Regarding Your Qualified Plan Restatement

  • What is a restatement?

The IRS requires that qualified retirement plan documents be restated, and subsequently re-adopted by employers, on a consistent basis. This is to ensure that plans remain up to date with all legislative and regulatory amendments. So that plans do not need to be re-written more frequently, pre-approved plans are restated on a regular six-year cycle, retroactively combining any amendments that may have been made since the last required restatement. 

  • What determines when a plan must be restated?

Pre-approved qualified plans must be restated every six years to maintain compliance with current legislation. The current restatement represents the third six-year remedial amendment cycle for pre-approved defined contribution plans. Since there was no real tax reform before the IRS began drafting the new plan language, this is simply referred to as the “Third Restatement.”

  • What is the deadline to restate my plan for the Third-Cycle Restatement?

The IRS requires that this restatement be completed by July 31, 2022. Therefore, no later than July 31, 2022, you must complete and sign your new Adoption Agreement reflecting these changes. You can also take this opportunity to make optional changes that you may wish to add to your plan.

  • What happens if I don’t restate my plan by the required date?

Your plan will no longer be a qualified plan and no longer have the advantage of being tax deferred. Your assets, and those of your employees if applicable, will become immediately taxable for the year following the restatement deadline. The IRS has provided guidance in Revenue Procedure 2019-19 regarding the penalty they will assess on a “non-amender” (an employer who does not amend and restate their qualified plan when required on a timely basis). The employer penalty is determined by calculating the amount of taxes due on all the assets in the qualified plan, plus interest and/or penalties for not paying the taxes on time.

The IRS also reserves the right to go back three years (the “open years”) to do this calculation. The Revenue Procedure also indicates the penalties that will apply if you execute the Adoption Agreement late (after July 31, 2022).

Steps to Restate Your Plan

How Do I Restate My Plan?

  1. Access the Plan Document, Trust Agreement, and Adoption Agreement, which have been updated in accordance with IRS requirements. 
  2. Please review and then sign where indicated on the Adoption Agreement via this link. Please note that if you fail to make a selection, the default option, if applicable, will automatically apply. 
  3. Please download a copy of all plan documents to be retained in your qualified plan compliance file. 

Other Important Information

New Direction Trust Company and their affiliates are not lawyers and cannot advise you on legal matters. While NDTCO will provide general information, you are responsible to ensure the enclosed adoption agreement and plan are the appropriate plan documents based on your current plan design and your future plans and goals

Furthermore, you are responsible to ensure that the adoption agreement and any other documentation are properly completed. We strongly encourage you to engage legal counsel or other experienced advisors to assist you in this process. Because we are not lawyers and because each situation is unique, we cannot guarantee your adoption agreement and related plan documents will be accurately and legally complete.


Please send a message via our Client Portal or call 877-742-1270, ex 191 for the Client Relations Department.