The Internal Revenue Service says it is plowing ahead with efforts to give defined benefit plan suppliers more confidence that their plans are structured properly.
The IRS will be issuing opinion and advisory letters for pre-approved “master and prototype” and “volume submitter” defined benefit plans that were restated to comply with changes in federal laws and IRS procedural guidelines, IRS officials write in Announcement 2010-20.
The IRS “expects to issue the letters on March 31, 2010, or, in some cases, as soon as possible thereafter,” officials write in the announcement.
Employers that get the favorable determination letters with respect to restatements for the Economic Growth and Tax Relief Reconciliation Act of 2001 and changes in IRS procedures will then have to adopt an EGTRRA-approved plan document by April 30, 2012, officials write.
The IRS “will accept applications for individual determination letters submitted by adopters of these pre-approved plans starting on May 1, 2010,” officials write.
The IRS told insurers, benefits consulting firms and other defined benefit plan service providers in 2007 that it would be giving them 2 years to adopt the newly approved plans once the procedures were in place, officials write.
“Adopting employers may apply for individual determination letters with respect to an EGTRRA-approved M&P or VS defined benefit plan beginning May 1,” officials write.
Officials say more information about the determination letter application process is available in IRS Revenue Procedure 2010-6 and in the frequently asked questions at Retirement Plans FAQs Regarding EGTRRA Determination Letter Program for Pre- Approved Plans.