7.11.4 IRC 401(a) Pre-Approved Plans Program

Manual Transmittal

September 26, 2018

Purpose

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

Material Changes

(1) Updated and renamed IRM 7.11.4.1, Overview of the Pre-Approved Plans Program, to Program Scope and Objectives. Also added IRM 7.11.4.1.1, Authority, and IRM 7.11.4.1.2, Acronyms, as required by IRM 1.11.2.2.5.

(2) Updated the IRM to delete the distinction between the Master & Prototype and Volume Submitter Programs which are combined and replaced by a single Opinion Letter program involving two types of plans: Standardized Plans and Nonstandardized Plans. See Rev. Proc. 2017-41.

(3) Add new sections IRM 7.11.4.6.6, Assisting Management & Compliance Planning & Classification, and IRM 7.11.4.6.7, Providing Technical Assistance to Counsel.

(4) Changed all references in IRM from Rev. Proc. 2017-4 to Rev. Proc. 2018-4.

Effect on Other Documents

This supersedes IRM 7.11.4, dated May 31, 2017.

Audience

Tax Exempt and Government Entities
Employee Plans

Effective Date

(09-26-2018)

Catherine L. Jones
Acting Director, Employee Plans
Tax Exempt and Government Entities

Program Scope and Objectives

  1. Purpose: This IRM provides procedures and guidance to employees who process and review opinion letter applications from Pre-Approved Plan Providers.

  2. Audience:

    1. Pre-Approved Plans Program clerk (clerk)

    2. First and Second Level Reviewers who work Pre-Approved Plans

    3. Pre-Approved Plans Coordinators (coordinators)

    4. Manager, Pre-Approved Plans Program

  3. Policy Owner: Director, EP

  4. Program Owner: EP

  5. Program Goals: The goal of EP Determinations is to ensure that plans comply with the tax laws. We do this by reviewing applications for determination and opinion letters and to protect the public interest by applying the tax law with integrity and fairness to all.

Authority

  1. The Pre-Approved Plans Program, is described in Rev. Proc. 2017-41

    • Rev. Proc. 2017-41 modifies and supersedes Rev. Proc. 2015-36.

    • Rev. Proc. 2015-36 modifies and supersedes Rev. Proc. 2011-49.

  2. Rev. Proc. 2016-37 which clarifies, modifies, and supersedes Rev. Proc. 2007-44, gives additional information on this program.

  3. The program’s scope has certain limitations as described in Rev. Proc. 2017-41, section 6.

Acronyms

  1. These acronyms are used in this IRM:

    Acronym Term
    DB Defined Benefit
    DC Defined Contribution
    EIN Employer Identification Number
    EP Employee Plans
    LRM Listing of Required Modifications
    POA Power of Attorney
    POD Post of Duty
    RAC Remedial Amendment/Approval Cycle
    TRAC TE/GE Rulings and Agreements Control System
    WebETS Web-Based Employee Technical Time System

Submitting a Pre-Approved Plan

  1. Pre-Approved Plan Providers file Opinion letter requests on:

    • Form 4461, Application for Approval of Standardized or Nonstandardized Pre-Approved 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 Standardized or Nonstandardized Pre-Approved Plans (Mass Submitter Adopting Provider).

  2. Pre-Approved Plan Providers mail applications to the EP Determinations Pre-Approved Plans Program at:

    Mailing Address Express Mail or a delivery service
    Internal Revenue Service
    P.O. Box 2508
    Cincinnati, OH 45201
    Attn: Pre-Approved Plans Coordinator
    Room 5106, Group 7521
    Internal Revenue Service
    550 Main Street
    Cincinnati, OH 45202
    Attn: Pre-Approved Plans Coordinator
    Room 5106, Group 7521
  3. Pre-Approved Plans have a six-year remedial amendment/approval cycle (RAC) as explained in Rev. Proc. 2016-37, section 14. The IRS uses the second and third years of the six-year cycle to review the plans for their compliance with IRC 401(a). The general deadline to submit Pre-Approved Plans is January 31st of the calendar year after the particular defined contribution (DC) or defined benefit (DB) six-year RAC opens.

    Exception:

    The on-cycle submission period for the third six-year remedial amendment cycle for DC plans was delayed to begin on October 2, 2017 per Rev. Proc. 2017-41, section 9.02 and end on December 31, 2018 per Rev. Proc. 2018-42.

  4. Pre-Approved Plan opinion letter applications must include:

    1. Applicable user fee per Rev. Proc. 2018-4, Appendix A, as adjusted annually

    2. Form 8717-A, User Fee for Employee Plan Opinion Letter Request

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

    4. Form 4461 series

    5. Attachment I (DC) or Attachment I-A (DB)

    6. Cover letter

    7. Plan document

    8. Adoption Agreement, if applicable

    9. Certification Regarding Interim Amendments

Late Submissions

  1. Pre-Approved Providers or Mass Submitters with valid opinion/advisory letters from the immediately preceding six-year cycle are expected to submit applications for each particular (DC or DB) six-year RAC on time. The same holds true for a new Provider or Mass Submitter unless that Provider or Mass Submitter didn’t exist during the particular general deadline to file.

  2. If Providers or Mass Submitters don't submit by the scheduled due date, it could result in a delay in processing the application and issuing a favorable letter.

  3. An employer adopting a late submitted Pre-Approved Plan could have less than the normal two year adoption period. See Rev. Proc. 2017-41, section 11, and Rev. Proc. 2016-37, section 21 for more details on off-cycle submissions.

  4. Once the two-year period starts for employers to adopt and possibly submit determination letter applications for a particular (DC or DB) six-year RAC, the Pre-Approved Plans Program doesn’t accept late submissions except for off-cycle word-for-word Identical Adopter plan applications (i.e., Forms 4461-B) described in Rev. Proc. 2017-41, section 11.

Impermissible Plan Types

  1. Rev. Proc. 2017-41, sections 6.02 and 6.03 discuss situations for which the IRS won’t issue opinion letters.

Issuance of Opinion Letters

  1. The IRS issues virtually all of their Opinion Letters at the same time for Pre-Approved Providers and Mass Submitters who file their plans timely.

  2. The IRS publishes an announcement with the date that adopting employers must adopt the newly approved plans.

  3. The date is a uniform date that applies to all adopting employers.

Expediting the Issuance of Opinion Letters in Certain Instances

  1. If a Provider or Mass Submitter wishes to expedite the issuance of an opinion letter for the situations described in IRM 7.11.4.8.2, Assumption of Sponsorship or IRM 7.11.4.2.1 (4), Late Submissions, they should submit user fees by a cashier's check or certified check made payable to the United States Treasury. Paying the user fee with a business or personal check will delay the IRS issuing the letter by approximately four to six weeks.

Minor Modification

  1. A minor modifier is a plan which only has a minor change to an otherwise identical word-for-word Mass Submitter’s Pre-Approved Plan. These plans don't require an in-depth technical review.

  2. For minor modifier plans: The Mass Submitter submits the Form 4461-B page 1 as a placeholder. When the Mass Submitter plan receives its preliminary notification (See IRM 7.11.4.6.5, Preliminary Notifications), they prepare a plan document for each minor modifier application and submit them to the IRS according to Rev. Proc. 2017-41, section 10.03(2).

  3. The first level reviewer, who reviewed the Mass Submitter lead plan, is assigned the minor modifier applications.

  4. The first level reviewer only reviews the changes that differ from the lead plan. If the reviewer determines the changes are not minor, he/she stops reviewing and offers the applicant the opportunity to file as a Provider..

  5. Typically, the minor modifiers don't go through the second or discretionary coordinator review process.

Duties of the Pre-Approved Plans Clerk (Clerk)

  1. The Pre-Approved Plans Program clerk helps manage the case flow.

  2. Clerk duties include:

    1. Establishing inventory records.

    2. Transmitting the user fee.

    3. Preparing tracking sheet and case file.

    4. Assigning/transferring cases.

Establishing the Record on TRAC (Clerk)

  1. As soon as you receive the application, create a record of it on the TE/GE Rulings and Agreements Control System (TRAC). Enter the following information into the system:

    1. Provider or Mass Submitter name and address

    2. Employer Identification Number (EIN)

    3. Applicable user fee year

    4. Fee type

    5. Check information

    6. Special comments, if any

    7. Plan name, plan number, plan form, and plan type

    8. Power of attorney (POA) info., if any

    9. Control date

Transmitting User Fee to Covington (Clerk)

  1. After inputting the information, print the TRAC screen and make one copy of each check.

  2. Prepare a Form 3210, Document Transmittal listing:

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

    2. Each check number and corresponding EIN.

  3. Create four copies of each Form 3210.

  4. Attach the actual checks and copies of the TRAC user fee screens to copies one and three of the Form 3210 and put this package into an envelope and seal it.

  5. Put the sealed envelope into an interdepartmental folder and mail it to Covington where the checks are processed and deposited:

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

  6. When Covington returns the Forms 3210, put them in the user fee master file binder.

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

  8. Put a copy of the check in the applicable Pre-Approved Plan case file with the banking information sanitized.

  9. Don’t hold checks unprocessed for more than three days.

Preparing Tracking Sheet (Clerk)

  1. Once the TRAC record and case number are created and the user fee is transmitted, prepare the tracking sheet (See IRM 7.11.4.5.3, Tracking Sheet) and attach it to the front of the case file.

  2. Write the TRAC case number on the outside of the case file. The case is now ready to be assigned to a first level reviewer.

Case Transfers/Assigning Cases (Clerk)

  1. Assign/transfer Pre-Approved Plan cases to reviewers and/or coordinators when necessary.

First Level Case Assignment (Clerk)
  1. When the coordinators are ready to assign the case to a first level reviewer, update the case record in TRAC indicating the first level reviewer's number and the "first level review" status code.

  2. Print the TRAC screen and place it in the case file. Mail (if reviewer’s Post of Duty (POD) isn’t Cincinnati) the case to the first level reviewer and email him/her notice of the case assignment.

Second Level Case Assignment (Clerk)
  1. When you receive a case file from a first level reviewer, acknowledge receipt by annotating the Form 3210 with the receipt date and initials. Return the original to the first level reviewer and update the TRAC record to the "awaiting assignment for second level review" status code. Print the TRAC screen and put the printout in the case file.

  2. File the case.

  3. When the coordinators are ready to assign the case to a second level reviewer, update the case record in TRAC indicating the second level reviewer's number and the "assigned to second level reviewer" status code. Print the TRAC screen and put it in the case file.

  4. Mail the case to the second level reviewer (if the reviewer’s POD isn’t Cincinnati) and email him/her notice of the case assignment.

Case Assigned Both First and Second Level (Clerk)
  1. Once a case file is assigned to both a first level reviewer and a second level reviewer, it’s not returned to the coordinators until it’s complete. The first and second level reviewers send the case back and forth to each other. When cases are moving back and forth between the first and second level reviewers, the applicable reviewer should notify the clerk in an email.

  2. Update the case record on TRAC to reflect the change in the current reviewer's number and indicate first or second level review status.

Review and Issuance of the Opinion Letter (Clerk)
  1. After review is complete, the second level reviewer returns the case to the coordinators for discretionary final review and eventual issuance of the opinion letter.

  2. Update the case on TRAC to reflect the case is in discretionary final review and put it in the coordinator’s TRAC number. Print the TRAC screen and insert it into the case file.

Case Closing (Clerk)
  1. After the coordinators review the case file and send a notification giving preliminary approval (See IRM 7.11.4.6.5, Preliminary Notifications), update the case in TRAC:

    1. Change the status code.

    2. Enter the preliminary notification date.

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

  2. Print the TRAC screen and put it in the case file. Hold the case and wait for the opinion letter to be issued.

Case Processing Procedures

  1. Applications for Pre-Approved Plans are worked by specialists selected by management.

    1. Generally, only grade 12 and 13 EP specialists from EP Determinations are selected.

    2. All lead plans go through a first level of review with a specialist and then a second level of review with another specialist.

    3. All grade 12 specialists work as first level reviewers and all grade 13 specialists perform first or second level review at the direction of the Manager, Pre-Approved Plans Program.

  2. To ensure consistency, all of the same Provider’s or Mass Submitter’s lead plans are assigned to one reviewer.

  3. The first and second level reviewers email the coordinators when they need work. The coordinators assign all work.

First Level Review Process

  1. First Level Reviewer: When you physically receive the case(s) from the clerk, complete the following as part of your initial review:

    1. Update the 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 Provider or Mass Submitter. See the Pre-Approved folder on the shared server for a template of the letter. Update the letter to list your name and contact information.

    3. Complete Form 5464-A, Case Chronology Record. You can complete one Form 5464-A for each case file or one master Form 5464-A for the entire Provider’s or Mass Submitter’s case files. Include your name and phone number. Under the section "Topics Discussed, Information Requested or Other Action Taken," enter "assigned for first level review" as the first entry. If more than one page, number each page accordingly.

    4. Complete your review using the applicable Cumulative List and the applicable Listing of Required Modifications (LRMs). Your review must include: Form 4461 series application, the cover letter, any plan documents, and adoption agreements. Complete the applicable Alert Guidelines when the plan doesn’t follow the LRM.

    5. When you complete all case files for a certain Provider or Mass Submitter, prepare a draft Letter 1196 to request any additional information. Clearly explain each change request or comment and provide the appropriate authoritative citation.

    6. When you complete the draft Letter 1196: prepare a Form 3210 with the notation "case is ready for assignment to a second level reviewer," transfer the files to the clerk (mail if outside of Cincinnati), send an email to the clerk informing them of the transfer and include in the email the plans’ names and the TRAC case numbers.

  2. Clerk: Upon receipt of the case files, acknowledge receipt by annotating the Form 3210 with the receipt date and initials. Return the original to the first level reviewer and forward the cases to the second level reviewer.

  3. Second level reviewer: Begin your review of the case(s) as described in IRM 7.11.4.4.2, Second Level Review Process. When you are done, return the case(s) to the first level reviewer to continue working the case.

  4. First level reviewer:

    1. When you receive the case(s) back from the second level reviewer, review the second level comments and appropriately incorporate them into the draft 1196 letter.

    2. Discuss any disagreements or questions about the comments with the second level reviewer by phone or email.

    3. Once all comments are agreed upon, finalize the 1196 letter and mail it to the Mass Submitter/Provider with a 30 day response period. You may, at your discretion, grant an extension of the response time.

    4. Keep the case files until the plan is perfected (ready to be closed in your opinion). You may need to create and send a 1955 letter as a follow up when additional items are needed after the initial request.

    5. Secure a final clean copy of the plan upon finalization of all amendments.

    6. When the plan is perfected, send the case(s) back to the second level reviewer with a Form 3210.

    7. Update the tracking sheet to reflect that the case(s) are being sent for final second level review and email the clerk and the second level reviewer with the case name(s) and the TRAC case number(s) informing them of movement.

Second Level Review Process

  1. Second level reviewer: You receive your case(s) from the clerk after the first level reviewer completes his/her initial review. When you physically receive the case(s), complete the following as part of your initial review:

    1. Update the 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 Provider or Mass Submitter. See the Pre-Approved folder on the shared server for a template of the letter. Update the letter to list your name and contact information.

    3. Complete a Form 5464-A, Case Chronology Record. You can complete one Form 5464-A for each case file or one master Form 5464-A for the entire Provider’s or Mass Submitter’s case files. Your Form 5464-A should be separate from the first level reviewer’s Form 5464-A. Include your name and phone number. Under the section "Topics Discussed, Information Requested or Other Action Taken," enter "assigned for second level review" as the first entry. If more than one page, number each accordingly.

    4. For your review, include the same items reviewed by first level and also the items identified on the draft 1196 letter.

    5. When you complete your review, prepare a typed write-up of any needed additional amendments, clarifications, and/or comments. Clearly explain each change request or comment and provide the appropriate authoritative citation. Your comments should note which are required and which are suggestions.

    6. Send the case files back to the first level reviewer with a Form 3210.

    7. Email the clerk and the first level reviewer informing him/her of the mailing and include the plans’ names and the TRAC case number(s).

  2. First level reviewer: Complete your review of the case(s) per IRM 7.11.4.4.1 (4) and return the case(s) to the second level reviewer.

  3. Second level reviewer:

    1. When the first level reviewer returns the case files for a final second level review, compare the final version of the plan with the 1196 and 1955 letters.

    2. If you determine that the plan needs additional amendments, prepare a typed list of comments and discuss with the first level reviewer. If you both agree changes are still needed, generally the second level reviewer secures the remaining changes.

    3. If you determine the plan is finished and ready for approval, send the case file to the coordinators with a Form 3210 stating the case file is ready for a discretionary final review (See IRM 7.11.4.6.4, Discretionary Coordinator Review) and email the clerk and the first level reviewer informing them of the movement.

Administrative Procedures

  1. Pre-Approved Plans reviewers should also follow these miscellaneous administrative procedures during their review:

    1. Mailing Cases

    2. Use Pen

    3. Tracking Sheet

    4. Monthly Report

    5. Case File Assembly

Mailing Cases

  1. Reviewers who are in a POD other than Cincinnati receive cases via mail. Reviewers must notify the coordinators if their POD has special mailing procedures. Attach a completed Form 3210 (listing the name of the case and the TRAC case number) to the case.

Use Pen

  1. All completed Pre-Approved Plan case files are scanned into the computer. To avoid damaging the scanning equipment, prepare all forms, Alert Guidelines, other worksheets and any supporting notes on the computer or use pen. Do not use pencil.

Tracking Sheet

  1. The tracking sheet is used to show the movement dates of the case between the first and second level reviewers and their case time at each point in time. Once the record is created on TRAC, (See IRM 7.11.4.3.1, Establishing the Record on TRAC (Clerk) the clerk prints the screen (Tracking Sheet) and attaches it to the front of the case file.

  2. When the case is ready to be sent to the coordinators for discretionary final review, the second level reviewer totals the first level reviewer’s and the second level reviewer’s hours and lists each total on the tracking sheet.

Monthly Report

  1. At the end of each WebETS cycle, reviewers email a case status report to the:

    1. Coordinators

    2. Manager of the Pre-Approved Plans Program

    3. Group manager of the reviewer

  2. Include on the monthly report:

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

    2. Case name

    3. Form of plan (for example, AA (adoption agreement) or SD (single document))

    4. Date of assignment

    5. Comments on the status of the case

    6. Date of last contact with the Provider or Mass Submitter

    7. Number of hours on the case to date

    8. Estimated date of completion (agreed upon between the first and second level reviewers)

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

Case File Assembly

  1. When first and second level review is complete, assemble the case file in this order:

    Left Side (Top to Bottom) Right Side (Top to Bottom)
    Pre-Approved Plan Tracking Sheet with first and second level hours totaled at bottom Form 8717-A, User Fee for Employee Plan Opinion 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**  

Coordinators' Duties

  1. There are two Pre-Approved Plans Coordinators. Reviewers may contact either coordinator with questions.

  2. The coordinators' duties include:

    1. Developing and conducting training.

    2. Assigning cases to reviewers.

    3. Assisting with the technical aspects of a case.

    4. Conducting the discretionary final review.

    5. Sending Preliminary Notifications.

    6. Assisting management and Compliance, Planning, & Classification as needed.

    7. Providing technical assistance to Counsel as needed.

Developing and Conducting Training

  1. The Pre-Approved Plans submitted for each six-year cycle must satisfy the Cumulative List of Qualification Changes for that particular six-year cycle.

  2. To ensure a quality and consistent review, the reviewers receive training for each new six-year cycle. The training enables the reviewers to understand:

    1. What is expected of them.

    2. The statutory and regulatory changes the Pre-Approved Plans must satisfy.

Assigning Cases to Reviewers

  1. The coordinators are responsible for assigning cases to the first and second level reviewers. The reviewers email the program coordinators when they need work. The program coordinators select the cases from the unassigned inventory and send a list to the clerk who updates TRAC.

Assisting with Technical Aspects of Case

  1. The coordinators provide technical guidance, conduct SABA sessions, and help to resolve new and emerging issues.

Discretionary Coordinator Review

  1. The coordinators (or one of their delegates) at their discretion conduct a final review of Pre-Approved Plan applications. The final review is completed after the first and second level reviewers agree that an application has been perfected.

  2. The purpose of the final review is to ensure certain key issues were addressed and consistently applied.

  3. After they complete the final review, the coordinators either:

    1. Issue a preliminary notification. See IRM 7.11.4.6.5, Preliminary Notifications.

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

    3. Secure additional information/amendments from the Provider or Mass Submitter.

Preliminary Notifications

  1. A preliminary notification is a notification that the coordinators send to the Provider or Mass Submitter notifying him/her that the IRS has reviewed their Pre-Approved Plan.

  2. The preliminary notification only assures the Provider/Mass Submitter that the coordinators believe the plan appears to meet the applicable Cumulative List qualification requirements used to review the plan as of the date of the notification. It doesn’t constitute an official Opinion letter.

  3. The coordinators prepare and send the notification to the Provider or Mass Submitter and send a copy to the first and second level reviewers. At this time, the first and second level reviewers can close the case off of their WebETS time sheets and monthly reports.

Assisting Management & Compliance Planning & Classification

  1. The Coordinators prepare monthly and interim reports detailing the status of the pre-approved inventory at various stages.

Providing Technical Assistance to Counsel

  1. The Coordinators are consulted for input on various forms of guidance related to the EP determination function.

Manager, Pre-Approved Plans Program

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

Processing Plans Involving Special Circumstances

  1. Some situations may arise while processing Pre-Approved Plan applications that require additional attention.

  2. Common situations involve:

    1. Withdrawal of a Pre-Approved Plan application.

    2. Assumption of sponsorship.

    3. Name and/or address changes.

    4. 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.

Withdrawing a Pre-Approved Plan

  1. A Provider or Mass Submitter may wish to withdraw his/her Pre-Approved Plan application.

  2. Specialists take the following steps when a Provider/Mass Submitter notifies them that they want to withdraw:

    1. Notify the Pre-Approved Plans Coordinators immediately.

    2. Inform the Provider/Mass Submitter that the IRS must receive an official letter of withdrawal.

    3. Inform the Provider/Mass Submitter that the user fee is non-refundable.

  3. Upon receipt of the official letter of withdrawal, the coordinators consider the case withdrawn and issue a letter to the Provider/Mass Submitter confirming the withdrawal.

  4. If the withdrawal is of a submission of an Identical Adopter of a Mass Submitter plan, the IRS refunds the user fee if the request is made before IRS issues the Opinion letter.

  5. If the withdrawal is of a submission of a Minor Modification of a Mass Submitter plan, the IRS refunds the user fee unless we’ve started our review.

  6. If an Identical Adopter of a Mass Submitter requests a switch of its submission to another Mass Submitter, no additional user fee is due if the request is made before IRS issues the Opinion letter.

Assumption of Sponsorship

  1. In some instances, another entity may assume sponsorship of an existing Pre-Approved Plan.

  2. If requested, the IRS reissues an opinion 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 new sponsor pays the required fee. See Rev. Proc. 2018-4 (revised annually).

    4. The new entity submits any other documentation evidencing the assumption of sponsorship as the IRS requests.

  3. The reissued opinion letter is dated based on either:

    • The postmark date when the new sponsor pays with a certified or cashier’s check.

    • A later date, after the check clears, when the new sponsor pays with a regular check.

Name and/or Address Changes

  1. A request for an updated Opinion letter for only an address change must include a cover letter indicating the change. No user fee is required.

  2. A request for an updated Opinion letter for a name change must include a cover letter and an updated application. No user fee is required.

Grossly Deficient Plans and Innovative Plan Designs

  1. The IRS won't rule on grossly deficient plans and innovative plan designs.

  2. A grossly deficient Pre-Approved Plan is a plan that is either:

    1. Substantially out of compliance with the applicable Cumulative List and other qualification requirements.

    2. So deficient that the IRS can’t review it in a reasonable amount of time.

  3. If you find a grossly deficient plan, 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 you discovered.

  4. If the coordinators agree that the plan is grossly deficient, the plan will be returned to the Provider/Mass Submitter giving him/her 30 days to resubmit a substantially compliant document. The coordinators closely analyze any re-submission for compliance before assigning it for review.

  5. The Pre-Approved Plans Program is meant for traditional plan designs; therefore innovative plan designs aren’t accepted in the program. If you encounter something in a Pre-Approved Plan that you don't recognize or for which you can’t find clear supportive IRS guidance (excluding private letter rulings), stop your review and contact the Pre-Approved Plans Coordinators immediately.

Definitions

The following table lists several definitions used in this IRM:

Term Definition
Adoption Agreement The part of the plan that lists the options an adopting employer may select.
Basic Plan Document The part of a plan containing all the non-elective provisions applicable to all adopting employers. The basic plan document may not have any options.
Identical Adopter Any person that has an established place of business in the U.S. where it is accessible during every business day who sponsors a plan as a word for word identical adopter of a Mass Submitter, regardless of the number of employers that are expected to adopt the plan.
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 Providers, each of which is offering, on a word-for-word identical basis, the same plan document.
Minor Modification A minor change to an otherwise word-for-word identical Pre-Approved Plan of the Mass Submitter that the IRS determines does not require an in-depth technical review.
Opinion letter A written statement issued by the IRS to a Provider or Mass Submitter as to the qualification in form of a plan under IRC 401, IRC 403(a), or both IRC 401 and IRC 4975(e)(7).
Pre-Approved Plan May be an Adoption Agreement Plan or a single plan document.
An Adoption Agreement Plan consists of a Basic Plan Document and an Adoption Agreement.
The single plan document consists of a single plan document offered by a Provider without an adoption agreement.
Provider Any person (including, if applicable, a Mass Submitter) 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 IRS in its application for an Opinion Letter that it has at least 15 employer-clients, each of which is reasonably expected to adopt the same Pre-Approved Plan of the Provider.
Remedial Amendment/Approval Cycle (RAC) Rev. Proc. 2005-66, which was later modified and superseded by Rev. Proc. 2007-44 and later clarified, modified, and superseded by Rev. Proc. 2016-37, established a system of cyclical remedial amendment periods under IRC 401(b). Under this system, Pre-Approved Plans have a six-year RAC. The cycles stagger the submission of Opinion letter applications so that defined benefit and defined contribution plans are submitted at different times.
Trust or Custodial Account Document The separate portion of a plan that contains the trust agreement or custodial account agreement and includes provisions covering matters such as the powers and duties of trustees, investment authority and the kinds of investments that the plan sponsor may make.

Note:

The trust agreement or custodial account agreement must be in a document separate from the rest of the plan. Copies of trusts or other funding mediums should not be submitted. The IRS will not review for, and the Opinion letter will not cover, any provisions included in trust documents.