Determination for Termination on a Volume Submitter Plan

[Guest sugar daddy]

We are submitting a DB for a letter of determination upon termination. The plan was established in 1967 and they have used volume submitter plans as far back as I can tell. Line 3c of Form 5310 asks "has the plan ever received a letter of determination". The plan has the letters for the volume submitter plans but not a specific letter for the plan. In this context will the IRS accept the volume submitter letter as a letter of determination for the plan? Otherwise Line 3c instructions say you have to go all the way back to either the original document or the last time the plan ever received a letter of determination and submit all subsequent amendments and restatements which may not be available. Would a VCP filing be the appropriate course of action in this case? I know our records only go back about 10 years or so on this plan.

[David MacLennan]

Based on my experience with DL's, the IRS will not accept the VS opinion letters for a DL. It has happened once or twice to me that the reviewer asked for all documents since inception which meant going back to TEFRA DEFRA REA. Ultimately the IRS reviewer accepted the documents from the past 10 or so years (I just told him earlier documents were not available and it was unreasonalbe to require them).

[Guest sugar daddy]

I guess the plan sponsor could opt to go through VCP or take their chances and opt not to file for determination.

[Kevin C]

Are you sure the plan wasn't ever submitted for a letter? The reason I ask is that VS reliance on the opinion letter is a fairly new thing. I think it may have started with the GUST documents. Prior to that, VS documents were normally submitted for determination letters.

The last filing I did that needed a copy of the determination letter, the client could not locate it. I requested and received a copy of the latest determination letter from the IRS. From the IRS website:

How do I obtain a copy of my prior determination letter?

Call the Employee Plans toll-free telephone number at 1-877-829-5500, and provide:

The Document Locator Number (DLN) or the Employer Identification Number (EIN),

Plan number,

Form number, and

Plan sponsor's name.

NOTE: A copy of a prior letter is available to the public if the plan has more than 25 participants.

Determination letters for plans with 25 or fewer participants may only be disclosed to plan participants, authorized representatives of plan participants, the plan sponsor and/or the sponsor's power of attorney.

[Guest sugar daddy]

Thank you Kevin C. I will check that number. The actuaries always handled the document preparation. I would think that the plan was submitted at some point, but it may have been years ago and I believe our files only go back to the 2000 plan year.

[Guest sugar daddy]

Kevin C.

FYI

We called that number and they stated that we would have to put in a written request at our Local Disclosure Office.

[Kevin C]

I think that is what they had me do, too. I faxed the request and they sent a copy of the most recent letter to our client in about 2 weeks.

[Guest sugar daddy]

The plan filed and received a DL back in 1994. The current actuary is not wanting to file for determination for Termination, the previous actuary stated the plan did not have to file for a DL in 2002 when it went to a Volume Submitter doc. The previous actuary does not have any of the old files either as they were shredded a few weeks ago. The current actuary thinks it is safer not to file as the plan was a multiple employer plan with one spun off and terminated last year. That plan sponsor elected not to file. The buyer of the current sponsor is wanting to file, however the current actuary thinks that post termination audit is very slim and it takes about a year to get a DL letter on termination. I am tending to agree with them. Ultimately the plan sponsor will decide or the buyer of the p.s. If the p.s. insisted on filing and the IRS finds something, what sort of sanctions may be assessed?