FAQs-Determination Letter Process- Is it important to retain copies of applications, demonstrations, & related information that were submitted to IRS?
Yes, it is very important to retain copies of all of the following information submitted to the IRS:
- Cover letter
- Other correspondence
- Other information and plan data
This information must be retained to preserve reliance on a determination letter to the extent that it applies to an optional determination request.
If a determination of operational compliance with the coverage and/or nondiscrimination requirements is requested, such determination is based on the information in the written plan document, the application and relevant demonstrations, and other supporting data submitted by the employer. Therefore, the employer/plan sponsor must retain copies of this information, or it will lose reliance on the letter with regard to the issues for which the information was provided.
See Publication 794, Favorable Determination Letter, for a more detailed discussion of the significance of a favorable determination letter.