Close Close

Regulation and Compliance > Federal Regulation > IRS

IRS Speaks On Plan Funding Waiver Requests

Your article was successfully shared with the contacts you provided.

NU Online News Service, Feb. 24, 2004, 6:07 p.m. EST – The Internal Revenue Service has published a guide for employers that want to ask for waivers of minimum retirement plan funding requirements.[@@]

The guide, Revenue Procedure 2004-15, gives the address of the unit that handles the requests and also describes the information that employers should include with the requests.

The revenue procedure, which applies to sponsors of defined contribution plans as well as defined benefit plans, requires that an employer show that meeting the minimum funding requirement would cause “substantial business hardship” and be “adverse to the interest of plan participants in the aggregate,” according to John Heil, the IRS employee plans official who is listed as the principal author of the revenue procedure.

“What constitutes appropriate evidence will depend on the facts and circumstances of each case,” Heil writes.

The revenue procedure asks that an employer seeking a waiver provide a brief description and history of the company, financial reports for the employer and financial reports for the retirement plan.

The employer also should try to provide comparable financial reports for all other entities in its “controlled group,” detailed information about executive compensation arrangements, an explanation about why the employer is suffering a temporary business hardship, and information about other court, arbitration and regulatory proceedings.

The bulletin is on the Web at //