Determination Letter Requirement When Correcting with Retroactive Amendment

[401 Chaos]

I'm confused by the EPCRS discussion / instructions regarding the potential determination letter requirement (and available exemptions) when correcting an operational failure by adoption of a retroactive amendment.

If you have an operational failure that doesn't come within the limited items permitting correction by retroactive amendment in SCP and the plan is maintained on a volume submitter, do you potentially have to file for a determination letter? In this case, the error is not being solved by adopting a volume submitter plan or an IRS model amendment but would include the adoption of an "optional amendment" to the existing volume submitter plan document. Is that enough to avoid any possible Determination Letter obligation? (The amendment would be to provide for full vesting of all accounts as of a prior date. TPA erroneously coded all accounts as 100% vested. Plan sponsor is fine with giving full vesting as only 2 NHCEs were impacted, amounts were small, and plan is now frozen.)

[Lou S.]

I thought the IRS had a Rev Proc last year (forget the number) that cleared up the issue that don't need an Individual DL if the amendment doesn't take you out of reliance on the Opinion/Advisory letter of the the VS or Prototype.

[401 Chaos]

Thanks! Rev. Proc. 2015-27 does appear to address this in changes to Section 6.05 of 2013-12.

https://www.irs.gov/irb/2015-16_IRB/ar06.html

[AMDG]

I thought so, too (that you don't need to file) , but others disagreed with my conclusion. Call your local irs district office. Maybe they can help.

[Mike Preston]

LOL

[401 Chaos]

AMDG,

Thanks very much. Do you recall the basis for others disagreeing with you? Although the revised guidance is still not as clear as it might be, it does seem to suggest a pass for general amendments to prototypes. Seems like too with the demise of the 5-year submission cycle, etc. that this would be a logical read as well.

I'll be sure to ask my local district office as well when they return my call regarding a VCR question from several years ago.