5310 Notice to Interested Parties

[Guest medinael]

Plan Sponsor of a terminating 401(k) Plan sent out a notice to interested parties notifying participants of its intent to seek a determination letter on termination of the Plan. Notice was sent out 10/17. Notice must go out not less than 10 or more than 24 days prior to the day the 5310 application is made. Seems Plan Sponsor still can't get its hands on some data required to complete the 5310. If the 5310 application won't be filed within 24 days of giving notice, what happens? Do they send another notice and start the clock all over?

Thanks for any insight.

[jpod]

Doesn't the Notice state that the application will be filed on "Date X?" If so, won't you have a problem if you miss that date, even if you're still within the 24 days?

[Guest medinael]

Doesn't the Notice state that the application will be filed on "Date X?" If so, won't you have a problem if you miss that date, even if you're still within the 24 days?

Yes, a date was specified and it looks like they won't meet that date. Lesson learned, have the 5310 absolutely complete before you send out the NTIP. The question remains, though, can they send out a new or amended notice (once they've got the 5310 ready) and start the clock over?

[John Feldt ERPA CPC QPA]

Yes, they can send out a new notice. Explain that because the submission date has been changed, a new revised notice had to be issued.

[Mike Preston]

This is all informal, but it has helped me in the past, so I'll share it now. The IRS is concerned that the participants have the appropriate notice so that, if the participants wish, they can make comments within the applicable periods. This means that if one is up against a deadline of some sort (like filing with the IRS within a certain period of time pursuant to some outside obligation with the plan sponsor) it is possible to issue the notice and submit before the 10 days has elapsed. The IRS form asks for the date that the notices were provided and the IRS (and the DOL) use that information for purposes of determining whether comments received by the participants are timely. The information in the notice (such as the deadlines for making comments) is ignored by the IRS/DOL and the real dates are substituted.

I know the question posted was about the other end of the deadline spectrum (that is, having the 24 day period expire) and certainly the right thing to do is to re-issue. But once re-issued, it is not necessary that one hold the IRS submission to ensure it is no less than 10 days from notice to submission. Just disclose the actual date of the notice to the IRS and the IRS will then take an "early" submission and automatically extend the dates for receipt of comments accordingly.

[401 Chaos]

Mike,

Can you (or others) elaborate a bit on the procedure here. For various internal reasons plan sponsor would like to file a 5310 for a nonamender as part of a VCP application and would like to do this ASAP before giving 10 days notice.

Are there no potential penalties for failing to provide the notice within the required window period? Seems strange they would require that timeperiod if all they are really worried about is making sure that participants have appropriate time to respond.

In the case you describe, do you prepare the notice as if you are giving the 10 day notice period but then just go ahead and file immediately upon handing out the notice?

Many thanks.