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Compliance January 5, 2010
New IRS Document Updates Determination Letter Procedures
January 5, 2010
(PLANSPONSOR.com) – The Internal Revenue Service (IRS) has updated
its procedures for requesting determination letters on the qualified status of pension,
profit-sharing, stock bonus, annuity, and employee stock ownership plans.
Reported by
Fred Schneyer
The tax agency said Revenue Procedure 2010-6 covers plans under tax codes 401(a), 403(a), 409, and 4975 and replaces Revenue Procedure 2009-6 issued in January 2009. The new procedures are effective February 1, 2010.
The revamped document outlines general procedures for requesting determination letters and specific procedures for master and prototype and volume submitter plans, including information on employer reliance on master and prototype and volume submitter plans.
The tax agency also laid out determination letter application procedures for multiple employer plans, group trusts, and affiliated service groups.
Specific changes in the procedures include:
- a revision to Section 7.03 to include a reference to the first submission period for Cycle E individually designed plans and Section 414(d) governmental plans, and to indicate that applications will be returned with user fees if an off-cycle submission is not reviewed before the end of the on-cycle submission period;
- a revision to Section 12.02(6) to clarify that Form 8905, Certification of Intent to Adopt a Pre-Approved Plan, must be executed before the end of an employer’s five-year remedial amendment cycle; and
- a revision to Section 12.07 to clarify that a terminating plan generally does not have to be restated.
The new document is available here.
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The agency also announced a deadline by which employers intending to maintain a Cycle 4 plan must adopt that plan.
