Qualification question

[fiona1]

401(k) plan is in Cycle D. They filed Form 5300 to the IRS (application for a determination letter) by the 1-31-2010 deadline.

They just realized that they answered some questions incorrectly on the Form. Should they:

a) Wait for the IRS to send them a letter and then correct the Form?

b) Revise the Form and send a new Form 5300 to the IRS with a cover letter explaining the situation?

[kgr12]

If you have received the acknowledgment letter from the IRS with your document locator number on it, I probably would try first to call them (even if the 145 days has not elapsed) and see if it has been assigned to a specialist. It probably makes the most sense to explain the whole situation to the specialist rather than to someone processing it through the assignment system. Therefore, prior to actually reaching the specialist that has your case, I would simply describe the issue as you needing to submit additional information that is relevant to the specialist's review. If it has not been assigned and the person you speak with tells you how to go about submitting additional info, I would write a letter (making sure you include your document locator number) indicating the information changed from your original submission (and the corresponding line(s) on the form). I wouldn't submit a new 5300 with it, but offer in your letter to do so if that's what they want you to do.

[fiona1]

Great. Thanks for the info...

[Guest Sieve]

Normally, I'd say wait until you hear from the IRS--few are the times we have not heard form the IRS about a submission prior to the FDL issuance. However, if all your interim amendments are in order and you have a prior FDL (or you're using a prototype), then you may not hear from the IRS before issuance of a letter (we're getting our EGTRRA FDLs without prior contact from the IRS), so calling the assigned agent, as suggested, is probably a good approach.

But, as a failsafe, I'd include either an entire new 5300 or the specific pages which include the changes.

[fiona1]

Thanks Sieve. Let me run something else by you on the topic of determination letters.

If a plan sponsor wants to file a Form 5310 for qualificaiton of a plan termination - does it really matter when they file it? In other words...

a. Can they file it before the actual plan term date?

b. Can they file it after the plan term date but before money has been distributed?

c. Or are they required to only file it after all of the money has been distributed?

[Guest Sieve]

You certainly don't have to wait until all assets are distributed--in fact, I never do so, because that defeats the whole purpose of getting an FDL on termination. I always recommend to the client that no HCEs receive termination distributions until the FDL is received, and suggest that no distributions occur until the FDl is received

But I would wait until after the term date--although I don't think it's a requirement.

[fiona1]

Thanks much...

[Guest Not such a bad guy]

You certainly don't have to wait until all assets are distributed--in fact, I never do so, because that defeats the whole purpose of getting an FDL on termination. I always recommend to the client that no HCEs receive termination distributions until the FDL is received, and suggest that no distributions occur until the FDl is received

But I would wait until after the term date--although I don't think it's a requirement.

a. yes

b. yes

c. per rev proc 2007-44 "However, in no event can the application be filed later than

twelve months from the date of distribution of substantially all plan assets in

connection with the termination of the plan. See section 14 with respect to the

Service’s review of an application for a determination letter with respect to a

terminating plan." No,

Also 5310 applictions ave tobefiled within 12 motnhs of the proposed term date.