7.11.4  IRC Section 401(a) Pre-Approved Plans Program

Manual Transmittal

July 16, 2013

Purpose

(1) This transmits revised IRM 7.11.4, Employee Plans Determination Letter Program, IRC Section 401(a) Pre-Approved Plans Program.

Material Changes

(1) This IRM has been updated to reflect current versions of annual revenue procedures.

(2) Updated for editorial changes including all references to the Form 5464, Case Chronology Record to reflect the correct number Form 5464-A.

Effect on Other Documents

IRM 7.11.4 dated April 4, 2012 is superseded.
Supersedes revised QAB 2008-2, Correcting Pre-Approved Master, Prototype and Volume Submitter Plan Language dated December 11, 2009.

Audience

Tax Exempt and Government Entities (TE/GE) Employee Plans Personnel

Effective Date

(07-16-2013)

Robert Choi
Director, Employee Plans
Tax Exempt and Government Entities

7.11.4.1  (04-04-2012)
Overview of the Pre-Approved Plans Program

  1. The Pre-Approved Plans Program is responsible for the administration and processing of opinion and advisory letter applications received from Master and Prototype (M&P) sponsors and Volume Submitter (VS) practitioners. This IRM is intended to provide procedures and guidance to those responsible for processing and reviewing these applications. This includes:

    1. Pre-Approved Plans Program clerk (clerk).

    2. First and Second Level Reviewers in the Pre-Approved Cadre (cadre).

    3. Pre-Approved Plans Coordinators (coordinators).

    4. Manager, Pre-Approved Plans Program.

  2. Rev. Proc. 2011-49, 2011-44 IRB 608 which modifies and supersedes Rev. Proc. 2005-16, 2005-10 IRB 674, describes the Master & Prototype (M&P) and Volume Submitter (VS) programs, collectively referred to as the Pre-Approved Plans Program. Rev. Proc. 2007-44, 2007-28 IRB 54 provides additional information relating to the program.

7.11.4.2  (07-16-2013)
Submitting a Pre-Approved Plan

  1. The following applications are used for advisory or opinion letter requests:

    • Form 4461, Application for Approval of Master or Prototype or Volume Submitter Defined Contribution Plans.

    • Form 4461-A, Application for Approval of Master or Prototype or Volume Submitter Defined Benefit Plan.

    • Form 4461-B, Application for Approval of Master or Prototype or Volume Submitter Plans (Mass Submitter Adopting Sponsor or Practitioner).

  2. Applications are mailed to the EP Determinations Pre-Approved Plans Program at the following address:

    Internal Revenue Service
    Attn: Pre-Approved Plans Coordinator
    P.O. Box 2508, Room 5106
    Cincinnati, OH 45201

  3. Pre-approved plans have a six-year remedial amendment/approval cycle (RAC) as explained in section 16 of Rev. Proc. 2007-44. The Service uses the first two years of the six-year cycle to review the plans for compliance with 401(a) requirements. The table below lists the types of applications and the general deadline for submitting the application.

    Type of Application: General Deadline for Submission:
    Non-mass submitter. January 31st of the calendar year following the opening of the particular (defined contribution (DC) or defined benefit (DB)) six-year RAC.
    Placeholder applications for word-for-word identical adopters and minor modifiers. January 31 of the calendar year following the opening of the particular (DC or DB) six-year RAC.
    Mass submitter plans. October 31 of the calendar year in which the particular (DC or DB) six-year RAC opens.

    See Exhibit 7.11.4-1, Definitions and Rev. Proc. 2011-49 for an explanation of the terms used in this paragraph.

  4. VS plan advisory letter applications and M&P plan opinion letter applications must include the following:

    1. Applicable user fee as described in Rev. Proc. 2013-8, 2013-1 IRB 237, (revised annually).

    2. Form 8717, User Fee for EP Determination Letter Request.

    3. Form 2848, Power of Attorney and Declaration of Representation, if applicable.

    4. Form 4461 series.

    5. Cover letter.

    6. Plan Document.

    7. Adoption Agreement (applicable to M&P plans and possibly to a VS plan).

    8. Trust Agreement.

    9. List of Variables (applicable only to VS plans).

7.11.4.2.1  (04-04-2012)
Late Submissions

  1. M&P sponsors or VS practitioners with valid letters from the immediately preceding six-year cycle are expected to submit timely applications for each particular (DC or DB) six-year RAC. The same holds true for a new M&P sponsor or new VS practitioner unless that sponsor or practitioner was not in existence during the timely submission period.

  2. Non-compliance with the scheduled due date could result in a delay in the processing of the application and subsequent issuance of a favorable letter.

  3. An employer adopting a late submitted plan could have less than the normal two year adoption period. See Rev. Proc. 2007-49, 2007-30 IRB 141 and Rev. Proc. 2008-56, 2008-40 IRB 826 for more details pertaining to on/off-cycle submissions.

  4. Once the two-year period for employer adoption and determination letter submission starts, the Service will not accept late submissions for a particular (DC or DB) six-year RAC other than those described in IRM 7.11.4.2.2, Off-Cycle Word-for-Word Identical Adopters.

7.11.4.2.2  (04-04-2012)
Off-Cycle Word-for-Word Identical Adopters

  1. Once the two-year period for employer adoption and determination letter submission starts for a particular (DC or DB) six-year RAC, the Pre-Approved Plans Program will only continue to accept off-cycle word-for-word M&P and VS plan applications (i.e., Forms 4461-B) for that six-year RAC. See section three of Rev. Proc. 2008-56.

7.11.4.2.3  (04-04-2012)
Impermissible Plan Types

  1. The Pre-Approved Plans Program is not open for all types of plans. Rev. Proc. 2011-49, sections 6.02 and 6.03 discuss areas which will not be covered by opinion letters. Rev. Proc. 2011-49, sections 16.02 and 16.03 discuss areas which will not be covered by advisory letters.

7.11.4.2.4  (04-04-2012)
Issuance of Opinion and Advisory Letters

  1. The Service will publish an announcement providing the date by which adopting employers must adopt the newly approved plans.

  2. The date will be a uniform date that will apply to all adopting employers.

7.11.4.2.5  (04-04-2012)
Expediting the Issuance of Opinion and Advisory Letters in Certain Instances

  1. If a sponsor or practitioner wishes to expedite the issuance of an opinion or advisory letter in the case of a situation provided in IRM 7.11.4.8.2, Assumption of Sponsorship or IRM 7.11.4.2.2, Off-Cycle Word-for-Word Identical Adopters, user fee payments should be submitted in the form of a cashier's check or certified check made payable to the United States Treasury. The submission of a business or personal check will generally delay the issuance of the letter by approximately four to six weeks.

7.11.4.2.6  (04-04-2012)
Minor Modifiers

  1. A minor modifier is a plan which only has a minor change to an otherwise word-for-word identical plan of the M&P mass submitter. These plans do not require an in-depth technical review.

  2. The mass submitter sponsor or practitioner submits the first page of the Form 4461-B as a placeholder and when the mass submitter plan receives its preliminary e-mail (See IRM 7.11.4.6.4, Preliminary E-mail), the sponsor will prepare a plan document for each minor modifier application and submit them to the Service in accordance with section 12.03 paragraph (2) of Rev. Proc. 2011-49.

  3. The minor modifier applications are reviewed by the first level reviewer who was assigned the lead plan.

  4. Only the changes differing from the lead plan are reviewed.

  5. Typically, the minor modifiers do not go through the second or third level review process.

7.11.4.3  (04-04-2012)
Duties of the Pre-Approved Plans Clerical Staff

  1. The Pre-Approved Plans Program clerk assists in the management of the case flow.

  2. The duties include:

    1. Establishing records.

    2. Transmitting the user fee.

    3. Preparing tracking sheet.

    4. Assigning/transferring cases.

7.11.4.3.1  (04-04-2012)
Establishing the M&P and VS Records

  1. Upon receipt of the application, the clerk creates a record of it on the TE/GE Rulings and Agreements Control System (TRAC). The clerk must enter the following information into the system:

    1. Sponsor/Practitioner name.

    2. Employer Identification Number (EIN).

    3. Applicable user fee year.

    4. Fee type.

    5. Check information.

    6. Special comments, if any.

7.11.4.3.2  (04-04-2012)
Transmitting User Fee to Covington

  1. After the information has been input, the screen from TRAC is printed and one copy of each check is made.

  2. The clerk prepares a Form 3210, Document Transmittal listing:

    1. The number of checks, if more than one.

    2. Each check number and corresponding EIN.

  3. The clerk will create four copies of each Form 3210.

  4. The actual checks and copies of the TRAC user fee screens are attached to copies one and three of the Form 3210 and this package is put into an envelope and sealed.

  5. The sealed envelope is put into an interdepartmental folder and mailed to Covington for processing and depositing of the checks. The mailing address for Covington is as follows:

    Internal Revenue Service
    201 West Rivercenter Blvd.
    Attn: Extracting Stop 312
    Covington, KY 41011

  6. The Form 3210s are eventually returned from Covington and the clerk will place them in the user fee master file binder.

  7. Copies two and four of the Form 3210, along with copies of checks, are put into the user fee master file binder maintained by the coordinators in Cincinnati.

  8. A copy of the check will be put in the applicable pre-approved plan case file with the banking information sanitized.

  9. Checks should not be held unprocessed for more than three days.

7.11.4.3.3  (04-04-2012)
Preparing Tracking Sheet

  1. Once the record is created and the user fee is transmitted, the tracking sheet (See IRM 7.11.4.5.3, Tracking Sheet) is prepared and attached to the front of the case file.

  2. The TRAC number is written on the outside of the case file. After the tracking sheet is attached to the case, it is ready to be assigned to a first level reviewer.

7.11.4.3.4  (04-04-2012)
Case Transfers/Assigning Cases

  1. At various times in the review of a pre-approved plan, the case will need to be assigned/transferred to reviewers and/or coordinators. It is the clerk's duty to complete these transfers.

7.11.4.3.4.1  (04-04-2012)
First Level Case Assignment

  1. When the coordinators are ready to assign the case to a first level reviewer, the clerk will update the case record in TRAC indicating the first level reviewer's number with the notation "first level review" .

  2. The clerk prints the TRAC screen and inserts it into the case file. The clerk will then send the case to the first level reviewer by mail (if applicable) along with an e-mail notifying him/her of the case assignment.

7.11.4.3.4.2  (04-04-2012)
Second Level Case Assignment

  1. When the clerk receives a case file from a first level reviewer, receipt is acknowledged by annotating the Form 3210 with the receipt date and initials. The clerk returns the original to the first level reviewer and updates the TRAC record to "awaiting assignment for second level review" . The clerk prints the TRAC screen and inserts the printout into the case file.

  2. The clerk files the case.

  3. When the coordinators are ready to assign the case to a second level reviewer, the clerk will update the case record in TRAC indicating the second level reviewer's number with the notation "assigned to second level reviewer" . The clerk will print the TRAC screen and insert into the case file.

  4. The clerk will send the case to the second level reviewer by mail (if applicable) along with an e-mail notifying him/her of the case assignment.

7.11.4.3.4.3  (04-04-2012)
Case Assigned Both First and Second Level

  1. Once a case file is assigned to both a first level reviewer and a second level reviewer, it will not be returned to the coordinators until it is complete.

  2. The first and second level reviewers will send the case back and forth between each other. When cases are moving back and forth between the first and second level reviewers, the clerk should receive an e-mail from the applicable reviewer. The clerk will update the case record on TRAC to reflect the change in reviewer's number and indicate first or second level review.

7.11.4.3.4.4  (04-04-2012)
Review and Issuance of the Opinion Letter

  1. When review of a case file is complete, it will be returned to the coordinators for review and issuance of the opinion or advisory letter. The clerk will update the case on TRAC to reflect the case is in third level review and put it in the coordinator’s TRAC number.

  2. The TRAC screen will be printed and inserted into the case file.

7.11.4.3.4.5  (04-04-2012)
Case Closing

  1. When the case file has been reviewed by the coordinators and the preliminary e-mail (See IRM 7.11.4.6.4, Preliminary E-mails) sent, the clerk will update the case in TRAC as follows:

    1. Change the status code.

    2. Enter the preliminary e-mail date.

    3. Enter the sum of the total hours from the first and second level reviewer.

  2. The TRAC screen will be printed and inserted into the case file. The case is then shelved to wait for issuance of the opinion or advisory letter.

7.11.4.4  (04-04-2012)
Case Processing Procedures for Cadre Members

  1. Applications for pre-approved plans are only worked by specialists in the Pre-Approved Plans Cadre. The cadre is comprised of designated EP Specialists, grade 12 and 13, from the various EP Determination groups. All lead plans go through a first level of review with a specialist and then a second level of review with another specialist. All grade 12 specialists will work as first level reviewers and all grade 13 specialists will perform first or second level of review at the direction of the Manager, Pre-Approved Plans Program.

  2. To ensure consistency, all of the VS lead plans of a VS practitioner or all of the M&P lead plans of an M&P sponsor will be assigned to one reviewer.

  3. Some organizations maintain both VS and M&P plans. In this instance, two reviewers will be paired to review all the lead plans of the organization. One reviewer will be assigned as the first level reviewer for the VS plans and the second level reviewer for the M&P plans. The other reviewer will be assigned as the first level reviewer for the M&P plans and the second level reviewer for the VS plans.

  4. The first and second level reviewers will e-mail the coordinators when work is needed. All work is assigned by the coordinators.

7.11.4.4.1  (04-04-2012)
First Level Review Process

  1. When the first level reviewer physically receives the case(s) from the clerk, he/she must complete the following as part of his/her initial review:

    1. Update his/her time sheet (WebETS) and the pre-approved plans monthly report. (See IRM 7.11.4.5.4, Monthly Report.)

    2. Prepare a case assignment letter and mail to the practitioner/sponsor. A template of the letter is available in the Pre-Approved folder on the shared server. The letter should be updated to provide the name and contact information of the first level reviewer.

    3. A Form 5464-A, Case Chronology Record must be completed. A Form 5464-A can be completed for each case file or a master Form 5464-A can be completed for all the case files of a particular M&P sponsor or VS practitioner. The Form 5464-A should include the name and phone number of the first level reviewer. Under the section "Topics Discussed, Information Requested or Other Action Taken," enter "first level review." When more than one page exists, each page should be numbered accordingly.

    4. The review of the VS or M&P file must be done in conjunction with a review of the applicable Cumulative List and the applicable Listing of Required Modifications (LRMs). Review must include: Form 4461 series application, the cover letter, any plan documents, adoption agreements, and trust agreements. Wherever the plan does not follow the LRM, then the applicable Alert Guidelines must be completed.

    5. When review of all case files is completed for a certain VS practitioner or M&P sponsor, the reviewer will prepare a draft 1196 letter to request any additional information needed. Clearly explain each change request or comment and provide the appropriate authoritative citation.

    6. When the draft 1196 letter is complete, the reviewer will prepare a Form 3210 with the notation "case is ready for assignment to a second level reviewer" and mail the files to the clerk. The first level reviewer will also send an e-mail to the clerk informing them of the mailing. Include in the e-mail the names of the plans and the TRAC case numbers.

  2. Upon receipt of the case files, the clerk will acknowledge receipt by annotating the Form 3210 with the receipt date and his/her initials. He/she will return the original to the first level reviewer and forward the cases to the second level reviewer.

  3. At this point, the second level reviewer will begin his/her review of the case(s). (See IRM 7.11.4.4.2, Second Level Review Process). When the second level reviewer has completed his/her initial review, the case(s) will be returned directly back to the first level reviewer for additional review.

    1. When the first level reviewer receives the case(s) back from the second level reviewer, he/she will review the second level comments and appropriately incorporate them into the draft 1196 letter.

    2. Any disagreements or questions relative to the comments should be discussed with the second level reviewer by phone or e-mail.

    3. Once all comments are agreed upon, the draft 1196 letter should be finalized and mailed to the sponsor/practitioner with a 30 day response period. Any extension to the response time can be granted at the discretion of the first level reviewer as good judgment dictates.

    4. The case files will remain with the first level reviewer until the plan is perfected. A final clean copy of the plan will need to be secured upon finalization of all amendments.

  4. When the plan is perfected, the first level reviewer will send the case(s) back to the second level reviewer with a Form 3210. The tracking sheet should be updated to reflect that the case(s) are being sent for final second level review. An e-mail should be sent to the clerk and the second level reviewer with the case name(s) and the TRAC case number(s) informing them of movement.

7.11.4.4.2  (04-04-2012)
Second Level Review Process

  1. The second level reviewer will receive his/her case(s) from the clerk after the first level reviewer completes his/her initial review. When the second level reviewer physically receives the case(s) from the clerk, he/she must complete the following as part of his/her initial review:

    1. Update his/her time sheet (WebETS) and the pre-approved plans monthly report. (See IRM 7.11.4.5.4, Monthly Report.)

    2. Prepare a case assignment letter and mail to the practitioner/sponsor. A template of the letter is available in the Pre-Approved folder on the shared server. The letter should be updated to provide the name and contact information of the second level reviewer.

    3. A Form 5464-A, Case Chronology Record must be completed. A Form 5464-A can be completed for each case file or a master Form 5464-A can be completed for all the case files of a particular M&P sponsor or VS practitioner. This should be separate from the first level reviewer’s Form 5464-A. The Form 5464-A should include the name and phone number of the second level reviewer. Under the section "Topics Discussed, Information Requested or Other Action Taken" , enter "second level review" . When more than one page exists, each page should be numbered accordingly.

    4. Whether it be a VS plan or an M&P plan, a second level review of the file must include the same items reviewed by first level and also the items identified on the draft 1196 letter.

    5. When review of all case files is complete for a certain VS practitioner or M&P sponsor, the reviewer will prepare a typed write-up of any additional amendments, clarifications, and/or comments he/she feels are needed. The reviewer will clearly explain each change request or comment and provide the appropriate authoritative citation. The second level comments should differentiate between those items which are required and those which are suggestions.

    6. The case files should then be sent directly back to the first level reviewer with a Form 3210.

    7. The second level reviewer will send an e-mail to the clerk and the first level reviewer informing him/her of the mailing. The e-mail will include the names of the plan(s) and the TRAC case number(s).

  2. At this point, the first level reviewer will complete his/her review of the case(s). The plan(s) should be perfected before returned to the second level reviewer. (See IRM 7.11.4.4.1, First Level Review Process.)

    1. When the case files are returned for final second level review, the second level reviewer will compare the final version of the plan with the 1196 and 1955 letters.

    2. If the second level reviewer determines that the plan requires additional amendments, he/she will prepare a typed list of his/her comments and discuss with the first level reviewer. If the first and second level reviewers agree changes are still needed, the case(s) should be sent back to the first level reviewer, unless it is agreed that the second level reviewer will secure the remaining changes. The case(s) should be returned (if applicable) with a Form 3210 and an e-mail should be sent to the clerk and the first level reviewer with the case name(s) and TRAC case number(s) informing him/her of the case movement.

  3. If the second level reviewer determines the plan is finished and ready for approval, the case file is sent to the coordinators with a Form 3210 stating the case file is ready for third level review. (See IRM 7.11.4.6.3, Third Level Review.) An e-mail is sent to the clerk and the first level reviewer informing them of the movement.

7.11.4.5  (04-04-2012)
Administrative Procedures for Cadre Members

  1. Reviewers in the cadre should also be sure to follow these miscellaneous administrative procedures during the review process:

    1. Mailing Cases.

    2. Use of Pen.

    3. Tracking Sheet.

    4. Monthly Report.

    5. Case File Assembly.

7.11.4.5.1  (04-04-2012)
Mailing Cases

  1. All reviewers not housed in the Cincinnati Post of Duty (POD) will receive cases via mail. The reviewer must notify the coordinators if there are special mailing procedures associated with his/her POD. A completed Form 3210 (listing the name of the case and the TRAC case number) must be attached to the case with each mailing.

7.11.4.5.2  (04-04-2012)
Use of Pen

  1. All completed pre-approved plans will be scanned into the computer. To avoid damaging equipment, all forms, Alert Guidelines, other worksheets, and any supporting notes, prepared by the reviewer must be in pen or printed from the computer.

7.11.4.5.3  (04-04-2012)
Tracking Sheet

  1. The tracking sheet is used to reflect the movement dates of the case between the first level reviewer and the second level reviewer as well as the time spent on the case by the applicable reviewer at each point in time. Once the record is created on TRAC, (See IRM 7.11.4.3.1, Establishing the M&P and VS Records) the screen is printed and the print out (Tracking Sheet) is attached to the front of the case file.

  2. When the case is ready to be sent to the coordinators for third level review, the second level reviewer should total the hours of the first level reviewer and the second level reviewer and list each total on the tracking sheet.

7.11.4.5.4  (04-04-2012)
Monthly Report

  1. At the end of each WebETS cycle, reviewers in the cadre will send, by e-mail, a case status report to:

    1. The coordinators.

    2. The manager of the Pre-Approved Plans Program.

    3. Their group manager.

  2. The monthly report should include the following:

    1. Case name.

    2. TRAC case number.

    3. Type of plan.

    4. Whether the plan is a VS or M&P.

    5. Whether the case is assigned as a first or second level review.

    6. Date of assignment.

    7. Comments on the status of the case.

    8. Date of last contact with the M&P sponsor or VS practitioner.

    9. Number of hours spent on the case to date.

    10. Estimated date of completion (which should be agreed upon between the first and second level reviewers).

    11. Name of other (first or second level) reviewer assigned to the case.

7.11.4.5.5  (04-04-2012)
Case File Assembly

  1. When first and second level review is complete, the case file should be assembled in order below.

    Left Side (Top to Bottom) Right Side (Top to Bottom)
    VS and M&P Tracking Sheet with first and second level hours totaled at bottom Form 8717, User Fee for EP Determination Letter Request
    Form 5464-A, Case Chronology Record Form 2848, Power of Attorney and Declaration of Representation
    Certification Regarding Interim Good Faith Amendments Copy of last opinion or advisory letter
    All worksheets completed Copy of application (Form 4461 series, if applicable)
    Any TRAC Documentation Copies of all correspondence in chronological order
    Any copies of Form 3210 Final clean copy of Adoption Agreement (if applicable)
    Any Handwritten Notes in Pen Final clean copy of Plan Document
    **Place all purged material in a separate folder behind case file** Final clean copy of Trust Agreement

7.11.4.6  (04-04-2012)
Coordinators Procedures

  1. There are two Pre-Approved Plans Coordinators, one for the M&P program and one for the VS program. When questions arise the reviewer should contact the coordinators for the specific program.

  2. The coordinators duties include:

    1. Assigning cases to reviewers.

    2. Assisting with the technical aspects of a case.

    3. Conducting the third level review.

    4. Sending Preliminary E-mails.

7.11.4.6.1  (04-04-2012)
Assigning Cases to Reviewers

  1. The coordinators are responsible for assigning cases to the first and second level reviewers. The reviewers e-mail the program coordinators when work is needed. The program coordinators selects the cases from the unassigned inventory and sends a list to the clerk who updates TRAC.

7.11.4.6.2  (04-04-2012)
Assisting with Technical Aspects of Case

  1. The coordinators provide technical guidance, conduct CENTRA sessions, and assist in the resolution of new and emerging issues.

7.11.4.6.3  (04-04-2012)
Third Level Review

  1. The coordinators (or one of their delegates) conduct a third level/final review of all pre-approved plan applications. The third level review is completed after the first and second level reviewers agree that an application has been perfected.

  2. The purpose of the third level review is to ensure certain key issues were addressed and consistently applied to all applications.

  3. Upon completion of third level review, the coordinators will either:

    1. Issue a preliminary e-mail. See IRM 7.11.4.6.4, Preliminary E-mails.

    2. Send the case back to the first or second level reviewer for further development.

    3. Secure additional information/amendments from the practitioner or sponsor.

7.11.4.6.4  (04-04-2012)
Preliminary E-mails

  1. A preliminary e-mail is an e-mail sent by the coordinators to the M&P sponsor or VS practitioner notifying him/her that review of a particular pre-approved plan has been completed by the Service.

  2. The preliminary e-mail only provides assurance that the coordinators believe the plan appears to meet the applicable qualification requirements identified on the Cumulative List used to review the plan as of the date of the e-mail. It does not constitute an official opinion or advisory letter.

  3. The e-mail is prepared and sent by the coordinators to the M&P sponsor or VS practitioner and will be blind copied to the first and second level reviewers. At this time the first and second level reviewers can close the case off of their WebETS timesheets and monthly reports.

7.11.4.7  (04-04-2012)
Manager, Pre-Approved Plans Program

  1. The Manager, Pre-Approved Plans Program runs the program and ensures that all issues are resolved timely. The coordinators may contact the Manager with any issues that prevent an application from being processed.

7.11.4.8  (04-04-2012)
Processing Plans Involving Special Circumstances

  1. Situations may arise when processing pre-approved plan applications that require additional attention.

  2. Common situations that occur involve:

    1. Withdrawal of a pre-approved plan application.

    2. Assumption of sponsorship.

    3. A grossly deficient plan or an innovative plan design.

  3. If a specialist has any additional questions or concerns, contact the coordinators for applicable procedures.

7.11.4.8.1  (04-04-2012)
Withdrawals of a Pre-approved Plan

  1. An M&P sponsor or VS practitioner may wish to withdraw his/her pre-approved plan application.

  2. The specialist will take the following steps upon notification of the request to withdraw:

    1. Notify the Pre-Approved Plans Coordinators immediately.

    2. Inform the sponsor/practitioner that the Service must receive an official letter of withdrawal.

    3. Inform the sponsor/practitioner that the user fee is non-refundable.

  3. Upon receipt of the official letter of withdrawal, the coordinators will consider the case withdrawn and issue a letter to the sponsor/practitioner confirming the withdrawal.

7.11.4.8.2  (07-16-2013)
Assumption of Sponsorship

  1. In some instances, another entity may assume sponsorship of an existing M&P or VS plan.

  2. If requested, the Service will reissue an opinion or advisory letter to the new entity if the following requirements are met:

    1. No additional amendments are made to the plan document.

    2. The assumption is evidenced by a change of EIN.

    3. The required fee is provided. See Rev. Proc. 2013-8 (revised annually).

    4. Any other documentation evidencing the assumption of sponsorship is submitted as requested by the Service.

7.11.4.8.3  (04-04-2012)
Grossly Deficient Plans and Innovative Plan Designs

  1. Grossly deficient plans and innovative plan designs will not be ruled on by the Service.

  2. A grossly deficient pre-approved plan is a plan that is substantially out of compliance with the applicable Cumulative List and other qualification requirements. It also includes a plan which is so deficient that it cannot be reviewed in a reasonable amount of time. If a grossly deficient plan is found, discontinue review and forward it to the coordinators with an explanation.

    1. Explain why the plan is considered grossly deficient.

    2. Identify any qualification issues which were discovered.

  3. If the coordinators agree that the plan is grossly deficient, return the plan to the sponsor/practitioner giving him/her 30 days to resubmit a substantially compliant document. Any re-submission will be closely analyzed for compliance by the coordinators before assigning it for review.

  4. The Pre-Approved Plans Program is meant for traditional plan designs so innovative plan designs are not accepted in the program. If a specialist encounters something in a M&P or VS plan which they do not recognize or cannot find clear supportive Service guidance (excluding private letter rulings), discontinue review and contact the Pre-Approved Plans Coordinators immediately.

Exhibit 7.11.4-1 
Definitions

The following table lists several definitions used in this IRM:

Term Definition
Adoption Agreement The portion of the plan containing the options that may be selected by an adopting employer.
Advisory Letter A written statement issued by the Service to a VS practitioner or VS mass submitter as to the acceptability of the form of a specimen plan and any related trust or custodial account under IRC 401(a) or IRC 403(a).
Basic Plan Document The portion of a plan containing all the non-elective provisions applicable to all adopting employers. No options may be provided in the basic plan document.
M&P Sponsor Any person that (1) has an established place of business in the United States where it is accessible during every business day and (2) represents to the Service that it has at least 30 employer-clients each of which is reasonably expected to timely adopt the sponsor’s basic plan document.
M&P Mass Submitter Any person that (1) has an established place of business in the United States where it is accessible during every business day and (2) submits opinion letter applications on behalf of at least 30 unaffiliated sponsors each of which is sponsoring, on a word-for-word identical basis, the same basic plan document.
Master Plan A plan that is made available by a sponsor for the adoption by employers and for which a single funding medium is established, as part of the plan, for the joint use of all adopting employers. A master plan consists of a basic plan document, an adoption agreement, and, unless included in the basic plan document, a trust or custodial account document.
Minor Modification A minor change to an otherwise word-for-word identical plan of the M&P mass submitter that does not require an in-depth technical review.
Opinion letter A written statement issued by the Service to a sponsor or M&P mass submitter as to the acceptability of the form of an M&P plan under IRC 401(a) or IRC 403(a), and, in the case of a master plan, the acceptability of the master trust under IRC 501(a).
Prototype Plan A plan that is made available by a sponsor for adoption by employers and under which a separate funding medium is established for each adopting employer. A prototype plan consists of a basic plan document, an adoption agreement, and, unless the basic plan document incorporates a trust or custodial account agreement the provisions of which are applicable to all adopting employers, a trust or custodial account document.
Remedial Amendment/Approval Cycle (RAC) Rev. Proc. 2005-66 established a system of cyclical remedial amendment periods under IRC 401(b). Under this system, individually designed plans have a five-year RAC and pre-approved plans have a six-year RAC. The cycles stagger the submission of determination letter applications so that different plans are submitted at different times.
Specimen Plan A sample plan of a VS practitioner (rather than the actual plan of an employer). A specimen plan may include an adoption agreement.
Trust or Custodial Account Document The portion of an M&P plan or Specimen Plan that contains the trust agreement or custodial account agreement and includes provisions covering such matters as the powers and duties of trustees, investment authority and the kinds of investments that may be made.
Volume Submitter Plan Refers to either a specimen plan of a VS practitioner or a plan of a client of the VS practitioner that is substantially similar to the VS practitioner’s approved specimen plan.
Volume Submitter Practitioner Any person that (1) has an established place of business in the United States where it is accessible during every business day and (2) represents to the Service that it has at least 30 employer-clients each of which is reasonably expected to timely adopt a plan that is substantially similar to the VS practitioner’s specimen plan.
VS Mass Submitter Any person that (1) has an established place of business in the United States where it is accessible during every business day and (2) submits advisory letter applications on behalf of at least 30 unaffiliated practitioners each of which is sponsoring, on a word-for-word identical basis, the same specimen plan.


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