Determination, Opinion and Advisory Letters for Retirement Plans - Off-Cycle Filing
Individually designed plans
An individually designed plan's determination letter is off-cycle when it is submitted in a period other than the last 12 months of the plan’s
- terminating plans
- new individually designed plans whose next regular on-cycle submission period ends at least two years after the end of the off-cycle submission period
- applications required by the IRS
- applications from plan sponsors with an urgent business need (granted only in limited cases where exceptional circumstances exist)
The IRS generally reviews applications for off-cycle plans using the annual Cumulative List based on the submission date of the letter application.
Example: Employer S is a cycle D filer based on its EIN ending in 4. Employer S submits an application for a determination letter for its individually designed defined contribution plan on January 1, 2011. This is after the Cycle D submission period that ended on January 31, 2010, for the plan’s current cycle and before the next Cycle D submission period that begins on February 1, 2014, making the submission an off-cycle filing. If the application is reviewed before the start of the next Cycle D submission period, employer S’s application will be reviewed using the 2009 Cumulative List because this is the list governing the cycle in which the application was received (Cycle E).
If the IRS has not yet reviewed the off-cycle application and the applicant files an on-cycle application, the IRS will likely contact the applicant, return the off-cycle filing and refund the first fee. The IRS cannot automatically convert an off-cycle filing into an on-cycle filing.
Pre-approved plan adopters
An employer adopting a pre-approved plan is usually entitled to rely on the favorable opinion or advisory letter issued to that pre-approved plan’s sponsor. An adopting employer may apply for a separate determination letter only in limited circumstances. The IRS will accept determination letter applications filed on Form 5307 only from VS plan adopters who:
- modify the terms of the approved specimen plan, and
- have not made modifications that cause the plan to be treated as an individually designed plan.
An eligible employer submits a determination letter application on Form 5307 during the 2-year period of employer adoption and submission as announced by the IRS for the particular
A pre-approved plan sponsor’s application for an opinion or an advisory letter is an off-cycle filing when it is submitted in other than the first 12 months (9 months for mass submitters) of the 6-year remedial amendment cycle for pre-approved plans. Once the IRS announced 2-year period of employer adoption and submissions for a particular 6-year cycle begins, the IRS will only accept opinion or advisory letter applications for a word-for-word identical adoption of a mass submitter plan. The IRS will not review off-cycle filings until it has reviewed and processed all on-cycle filings. For this reason, the opinion or advisory letter the IRS issues to an application filed off-cycle will generally be issued at a point in time where the announced period for employer adoption and submission has less than 2 years remaining.
- Determination, Opinion and Advisory Letters
5-year remedial amendment cycle (individually designed plans) 6-year remedial amendment cycle (pre-approved plans)