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Ret plans - amendments required, incl. EGTRRA

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[Guidance Overview] Plan Sponsors of Cash Balance, PEP Plans and Certain Merged Retirement Plans Can Apply for an IRS Determination Letter, Starting September 1, 2019
"If the application is filed and the IRS identifies a document failure in a hybrid plan not related to the hybrid plan regulations, or if it identifies plan document failures in merged plans not related to the plan merger, the IRS will then impose a special sanction equal to the applicable [VCP] user fee that would have applied had the plan sponsor identified the failure and submitted the plan for consideration under the VCP, if either of [two] conditions apply[.]" (DLA Piper)
[Guidance Overview] Plan Problems: What's New With Self Correction and VCP?
"There are a few expanded opportunities provided under SCP and some clarification that certain activity will require correction through a VCP process.... The IRS has also issued clarification on some other items which, when corrected, should go through a VCP. The IRS has made accessing guidance on common failures, along with how to correct those failures very simple to find on their website. [This article] details some of the highlights on SCP, VCP, and where to locate the support you need." (WithumSmith+Brown, PC)
[Guidance Overview] IRS Expands Determination Letter Program for Certain Hybrid and Merged Plans
"[S]tatutory hybrid plans -- defined benefits plans (such as cash balance or pension equity plans) that typically express a participant's accumulated benefit as the current balance of a hypothetical account maintained for the participant or the current value of an accumulated percentage of the participant's final average compensation -- are permitted to submit an application for a determination letter during the 12-month period beginning September 1, 2019 and ending August 31, 2020.... IRS also will begin accepting determination letter applications from merged plans beginning September 1, 2019. Submissions from merged plans will be accepted on an ongoing basis during an eligibility window based on the date of the merger." (Slevin & Hart, P.C.)
[Guidance Overview] Updated EPCRS Expands Self-Correction Opportunities for Retirement Plan Sponsors
"Under the expanded program, self-correction can be used to correct operational failures by adopting retroactive plan amendments to conform the plan terms to the plan operations if: [1] the amendment would result in an increase of a benefit, right, or feature; [2] the increase is provided to all eligible employees under the plan; and [3] the increase is permitted under the code and satisfies the general correction principles of EPCRS." (Wilson Sonsini Goodrich & Rosati)
[Guidance Overview] The Art of Self-Correction: Retirement Plan Loan and Document Failures Under EPCRS
"Self-correction requires an analysis of the facts of a plan operational failure to determine whether self-correction is an option as well as the correction process. It is imperative ... to maintain the correction data and document the process taken to correct a mistake as evidence of the decision to self-correct and the manner in which the correction was made." (DLA Piper)
The IRS Determination Letter Program Reopens (a Little) for More Business
"The IRS clarifies in [Rev. Proc. 2019-20] that this determination letter opportunity cannot be used to avoid [VCP] user fees for any document failures discovered during the review.... If the failure meets a specific 'good faith' standard, it will only be subject to the reduced VCP sanctions. With respect to statutory hybrid plans, failures related to the final hybrid plan regulations are not subject to such sanctions. For merged plans, a failure related to the merger amendment itself is likewise not subject to sanctions." (Findley)
IRS Provides Welcome Relief from High VCP Fees
"In January 2018, the IRS announced a new VCP fee structure based on plan assets, rather than on the number of plan participants. This fee structure eliminated several exceptions -- including amendment or loan failures -- that used to carry a fixed or reduced general fee. As a result, many employers face significantly higher fees to correct operational failures under the VCP. But the IRS also allows more employers to fix plan failures through self-correction, perhaps as a result of the vigorous criticism about higher fees." (Ascensus)
IRS Expands Self-Correction Program for Retirement Plans (PDF)
"[A chart] summarizes the steps and conditions for correcting certain plan loan failures." (Milliman)
Present Law and Background Relating to Challenges in the Retirement System
65 pages. "The Senate Committee on Finance has scheduled a public hearing on May 14, 2019, on Challenges in the Retirement System. This document ... provides a discussion of present law and data." Topics: [1] Present law: Tax-favored employer-sponsored retirement plans; Defined contribution plans; Individual Retirement Arrangements (IRAs); and Early distributions and required minimum distributions. [2] Data relating to retirement savings: Overview; General data on qualified retirement plan participation; Data related to Social Security benefits as a source of retirement income; and Assets held outside of qualified plans and IRAs. (Joint Committee on Taxation [JCT], U.S. Congress)
[Guidance Overview] IRS Expands Determination Letter Program to Hybrid and Merged Plans
"The window for hybrid plans provides an opportunity for plan sponsors of these plans to obtain a review of all provisions related to the final hybrid plan regulations, which were not fully addressed in the most recent remedial amendment cycle. Note that the scope of the IRS review of a merged plan will not be limited to the merger-related amendment, and the review of a hybrid plan will not be limited to review of the plan provisions impacted by the final hybrid plan regulations." (Stinson Leonard Street)
[Guidance Overview] IRS Reopens Determination Letter Program for Certain Plans
"For sponsors of individually designed cash balance and other statutory hybrid plans, [Rev. Proc. 2019-20] provides an important but time-limited opportunity to confirm whether their plan documents are fully compliant with the final cash balance regulations, including the IRS' requirements for using a 'market rate of return' for a plan's interest crediting rate.... Sponsors of traditional defined benefit plans that may be considering converting to a cash balance or other hybrid formula should consider whether it may make sense to effectuate the conversion on or before August 31, 2020, in order to take advantage of this limited opportunity from the IRS." (Groom Law Group)
Say Hello to the Expanded IRS Self-Correction Program
"In most cases, demographic and employer eligibility failures remain unavailable for SCP correction.... If [the] loan correction also requires a submission under the [DOL's] Voluntary Fiduciary Correction Program (VFCP) because, for example, the sponsor did not properly administer loan repayments, a no-action letter for a loan default failure corrected under VCP (not SCP) is still required by the DOL before it will issue its own VFCP no-action letter." (AllThingsERISA at FisherBroyles)
[Guidance Overview] IRS Cracks Open Determination Letter Program for Merged Plans and Hybrid (Cash Balance) Plans
"The transition period for coverage testing ends on the same date by which the plan merger must take place to file for a determination letter under this program. Under the coverage rules, the transition period would be cut short by a significant coverage change under the plan -- so a merger date that would allow the plan sponsor to request a determination letter under this program may cut the transition period short if benefit formula changes for either of the pre-merger groups are made effective on that date." (Buck)
[Guidance Overview] New Opportunity for Certain Retirement Plans to Obtain IRS Determination Letters
"[C]ertain merged plans resulting from a merger or acquisition of an unrelated entity may be filed at any time on an ongoing basis, beginning September 1, 2019.... Assuming calendar year plans, [1] Mergers or acquisitions that occurred in 2017, with plans merged in 2017 or 2018, can be filed no later than December 31, 2019. [2] Mergers or acquisitions that occurred in 2018, with plans merged in 2018 or 2019, can be filed no later than December 31, 2020." (Husch Blackwell)
IRS Rev. Proc. 2019-20 Expands Determination Letter Program
"Rev. Proc. 2019-20 ... [1] Extends, on a limited basis, the remedial amendment period ... under specified circumstances. [2] Provides special sanction structures that apply to certain plan document failures discovered by the IRS during the review of a statutory hybrid plan or a merged plan submitted for a determination letter." (Thomson Reuters Practical Law)
[Guidance Overview] IRS Determination Letter Program Expanded ... to a Limited Extent
"Most small to medium-sized companies use preapproved plan documents for their retirement plans. Nonetheless, there are times (particularly in relation to hybrid plans or the merger of plans) when the document must be more flexible than a preapproved document will permit. In that situation, the ability to obtain a new FDL in limited circumstances is a very welcome change." (Ferenczy Benefits Law Center)
[Guidance Overview] IRS Announces Limited Expansion of Its Determination Letter Program, But Questions Remain
"Although it is not entirely clear, it would appear that the one-year review period would be open to any defined benefit plan that has a hybrid benefit formula, even if the plan's hybrid formula applies only to a subset of the plan's participants.... At first glance, the merged plan review procedure appears relatively straight-forward. However, the guidance gives rise to a number of important issues: [1] Are sponsors required to submit merged plans for review? ... [2] Merging pre-approved plans into individually designed plans.... [3] Plan document failures from acquired plans.... [4] Pre-2017 transactions ... [5] Multiple plan mergers." (Proskauer's ERISA Practice Center)
[Guidance Overview] Corrections Made Easier: IRS Expands the Self-Correction Program
"It is expected that the next two-year restatement window for defined contribution plans will run from mid-2020 to mid-2022. The related six-year cycle will end on January 31, 2023. Therefore, if a plan is not restated by January 31, 2023 ... the plan document may no longer be subject to an opinion letter for the most recently expired cycle (i.e., the cycle ended January 31, 2023). In that case, the failure may not be self-correctable, requiring a filing under VCP. Needless to say, this is an odd result, and we hope that it is simply an unintentional glitch caused by the procedure's wording. We hope the question will be clarified (favorably) by the IRS." (Ferenczy Benefits Law Center, via FIS Relius)
[Guidance Overview] IRS Expands Determination Letters for Hybrid, Merged Plans
"IRS will offer sanction relief for plan document defects discovered while reviewing a DL application submitted under this new revenue procedure: ... For statutory hybrid plans, IRS won't impose a sanction for any plan document failure due to a plan provision that doesn't comply with the final hybrid plan regulations in Treas. Reg. Sections 1.411(a)(13)-1 and 1.411(b)(5)-1.... For merged plans, IRS will impose no sanction for defective plan provisions included to implement the plan merger." (Mercer)
[Guidance Overview] IRS Expands Determination Letter Program
"Because the IRS's scope of review during a statutory hybrid plan's most recent remedial amendment cycle did not include provisions related to the final hybrid plan regulations, sponsors of statutory hybrid plans now have the opportunity ... during this one year submission window to verify their plans comply with the hybrid plan rules and to correct plan document failures related to these rules without having to pay a sanction.... Second, sponsors of individually-designed 'merged plans' may, on an ongoing basis, submit requests for determination letters." (The Wagner Law Group)
[Guidance Overview] IRS Expands Determination Letter Opportunities for Retirement Plans
"Since 2017, the determination letter program has been available only for new or terminating individually designed plans. Beginning on September 1, 2019, the determination letter program will be expanded [by Rev. Proc. 2019-20] to include [1] retirement plans that merge as the result of a corporate transaction, and [2] certain defined benefit plans." (Smith, Gambrell & Russell, LLP)
IRS Issues Retirement Plan 'Operational Compliance' Checklist for 2019
"The 2019 Operational Compliance List starts with some important caveats, including: [1] While the IRS intends to periodically update the list, it is not intended to be comprehensive. [2] A plan must be operated in compliance with all changes in qualification requirements from the respective effective date of each such change. [3] In order to be qualified, a plan must comply operationally with each relevant qualification requirement, even if the requirement is not included on the Operational Compliance List." (Michael Best)
[Official Guidance] Text of IRS Rev. Proc. 2019-20: Expanded Availability of Determination Letter Applications (PDF)
"This revenue procedure ... provides for a limited expansion of the determination letter program with respect to individually designed plans. Under this limited expansion, the [IRS] will accept determination letter applications for [1] individually designed statutory hybrid plans during a 12-month period beginning September 1, 2019, and [2] individually designed Merged Plans (as defined in section 5.01(2) of this revenue procedure) on an ongoing basis. As provided by Rev. Proc. 2016-37, a plan sponsor continues to be permitted to submit a determination letter application for initial plan qualification and for qualification upon plan termination. This revenue procedure also provides for a limited extension of the remedial amendment period under Section 401(b) of the Internal Revenue Code and Rev. Proc. 2016-37 under specified circumstances, and for special sanction structures that apply to certain plan document failures discovered by the IRS during the review of a plan submitted for a determination letter pursuant to this revenue procedure." (Internal Revenue Service [IRS])
[Guidance Overview] IRS Expands Plan Self-Correction Program
"Although the new guidance allows plan sponsors to correct plan document failures without formal IRS approval, they have a limited time period in which to do so. This underscores the importance of periodically reviewing plan documents and catching errors quickly.... Because operational failures based on a misunderstanding of plan document provisions can sometimes continue for extended periods of time, and SCP is available for long-term errors only if those errors are 'insignificant,' there may be additional pressure on the boundaries of that standard." (Eversheds Sutherland)
[Guidance Overview] Corrections Made Easier: IRS Expands the Self-Correction Program
"While it considers loan problems corrected under VCP to be fully corrected for ERISA purposes, the [DOL] does not give that same deference to self-correction under EPCRS. Therefore, if the plan sponsor or participant wants to be sure that the loan does not represent a prohibited transaction or that excise taxes are not accruing, a separate filing under the DOL's Voluntary Fiduciary Correction Program will be required.... The new procedure allows self-correction by amendment in many more situations.... [In] order to self-correct these issues, the correction must be done before the end of the second year following the year in which the error occurred." (Ferenczy Benefits Law Center)
[Guidance Overview] IRS Makes Significant Improvements to EPCRS in Rev. Proc. 2019-19
"[O]perational mistakes can result in participants receiving higher benefits than were called for under the terms of the plan. If the plan sponsor is willing to provide for the higher benefit, this type of mistake can now be corrected through a retroactive conforming amendment." (Trucker Huss)
IRS Updates EPCRS and Expands Self-Correction Program
"The user fee for a VCP submission currently ranges from $1,500 to $3,500, depending on total plan assets. The SCP expansion should reduce the number of VCP submissions that plan sponsors must make, thereby saving the time and expense involved in preparing a submission. As participant loans are a frequent source of errors in 401(k) plans, plan sponsors should pay particular attention to the loan changes. Even with the changes, not all loan failures can be self-corrected." (Thomson Reuters Practical Law)
IRS Expands Self-Correction Program for Retirement Plan Errors
"Effective immediately, [Rev. Proc. 2019-19] provides plan sponsors and practitioners long-desired participant loan correction relief, as well as greatly expands the types of failures that can be corrected by retroactive amendment through the Self-Correction Program (SCP)." (Holland & Hart LLP)
[Official Guidance] Text of IRS Rev. Proc. 2019-19: Updates to Employee Plans Compliance Resolution System (PDF)
128 pages. "This revenue procedure modifies and supersedes Rev. Proc. 2018-52 ... published primarily to expand SCP eligibility to permit correction of certain Plan Document Failures and certain plan loan failures, and also to provide an additional method of correcting Operational Failures by plan amendment under SCP ... [b]eginning April 19, 2019 ... SCP is available to correct certain plan loan failures.... Reporting of deemed distributions ... Plan loan statutory failures.... Failure to obtain spousal consent for a plan loan.... Expanding SCP to correct certain plan loan failures by plan amendment.... [T]he Treasury Department and the IRS received comments on permitting the correction of Overpayments under SCP, and are currently developing guidance on these issues." (Internal Revenue Service [IRS])
One Year to Go Until the 403(b) Restatement Deadline
"Not-for-profit organizations have an opportunity during the restatement period to align their retirement plan procedures with their written plan documents to help ensure that their retirement plans are following best practices. Changes may need to be made to the operations of the plan, the provisions in the plan documents or both." (CBIZ)
VCP Submissions Must Be Submitted Electronically Beginning April 1
"To submit a VCP application on or after April 1, 2019, the applicant must [1] create an account at ... [2] complete a Form 8950 using the website ... [3] documents relating to the VCP submission such as a description of failures, Form 14568 (Model VCP Compliance Statement), applicable schedules and other relevant items must be converted into a single PDF file and uploaded to ... [4] pay the applicable user fee via the website." (Greensfelder)
[Official Guidance] Text of IRS-Authored Operational Compliance List, Updated for 2019
"The Operational Compliance List is provided ... to help plan sponsors and practitioners achieve operational compliance by identifying changes in qualification requirements effective during a calendar year.... Effective in 2019: [1] Changes relating to hardship distributions: Bipartisan Budget Act of 2018, Sections 41113 and 41114.... Proposed regulations regarding hardship withdrawals ... Relief for victims of hurricanes Florence and Michael ... [2] Extension of temporary nondiscrimination relief for closed defined benefit pension plans (Notice 2018-69)." (Internal Revenue Service [IRS])
IRS Correction Program Now More Efficient
"The IRS introduced the most recent EPCRS transformation in September 2018, through Revenue Procedure 2018-52, which becomes effective next month, on April 1, 2019. The biggest change is to the VCP submission procedures. The IRS will no longer accept VCP submissions through the mail-in hard-copy form; instead, Plan Sponsors must use the website for VCP submissions." (Jackson Lewis P.C.)
IRS Requires Electronic VCR Applications Beginning April 1
"Beginning April 1, 2019, applicants seeking to resolve employee benefit tax qualification issues via the Voluntary Compliance Resolution (VCR) program must submit applications electronically through Any paper VCP submissions sent to the IRS with a postmark after March 31, 2019, will be returned to the applicant." (Solutions Law Press)
403(b) Plan Remedial Period Closing Less Than Year from Now
"While the March 31, 2020 deadline may seem far off, the correction process requires significant time. Since amendments to the plan document must be retroactive to January 1, 2010 (or the plan's effective date, if later), a review must be done to evaluate both [1] all amendments made to the plan since that date, and [2] whether the plan has in fact been administered consistently with the plan document since that date." (Sheppard Mullin)
Time to Review 403(b) Plans for Compliance with IRS Requirements
"The IRS has established a pre-approved plan program under which a plan sponsor has until March 31, 2020, to retroactively adopt a plan document which the IRS has already opined complies with the requirements of Internal Revenue Code section 403(b). A plan sponsor should analyze whether a pre-approved plan document works administratively and structurally with its objectives. The IRS has indicated that it does not intend to establish a determination letter program for individually designed section 403(b) plans." (Miller Canfield)
[Official Guidance] VCP Submission Kit: Failure to Have Adopted a New Pre-Approved Defined Contribution Plan by the April 30, 2016 Deadline
"Plan sponsors may use this Voluntary Correction Program (VCP) Submission Kit if they: didn't adopt an updated pre-approved defined contribution (DC) plan for the Pension Protection Act (PPA) by April 30, 2016, and want to correct this failure by adopting an updated pre-approved DC retirement plan to bring their plans back into compliance.... As a plan sponsor, you'll need to take additional steps to correct any other failures." (Internal Revenue Service [IRS])
#10YearChallenge for 403(b) Plans
"The restatement deadline is an opportunity to retroactively restate the plan document (generally, to January 1, 2010) to correct any defects in the terms of the plan documents, such as missed plan amendments. It is also the last chance for tax-exempt employers with individually designed plan documents to restate onto a pre-approved document, as the IRS does not now, and does not intend to, issue approval letters for individually designed 403(b) plans" (E is for ERISA)
No VCP Fee Relief in Updated Rev. Proc.; Some Fees Increased
"Unlike prior years, the 2018 VCP fee was determined by reference to net plan assets with no reduced fees for minimum distribution, participant loan, or plan amendment failures.... The revised schedule drew some criticism from trade groups that advocated for a return to some of the reduced fees for common failures.... The updated procedure for 2019 in [Rev. Proc. 2019-04] does not budge on the VCP fees[.]" (Buck)
[Official Guidance] Text of IRS Rev. Proc. 2019-4: Revised Procedures for Determination Letters and Letter Rulings
"This revenue procedure is a general update of Rev. Proc. 2018-4 ...

"[4] Section 8.03(1) is modified to add Section 414(b), (c) and (m) to the list of sections for which a determination is not made when a determination letter is issued in accordance with this revenue procedure.

"[5] Section 9.03 is modified to clarify that in order for a plan to be reviewed for, and a determination letter relied upon with respect to, whether the terms of the plan satisfy one of the design-based safe harbors in Sections 1.401(a)(4)-2(b) and 1.401(a)(4)-3(b) ... the plan document must provide a definition of compensation that satisfies Section 1.414(s)-1(c)....

"[8] Section 24.03 is modified to provide that Employee Plans Rulings and Agreements will consider a request for an extension of time for making an election ... to recharacterize annual contributions made to a Roth IRA. Employee Plans Rulings and Agreements will also consider recharacterization requests ... that relate to a conversion or rollover contribution to a Roth IRA but only if the rollover or conversion was made prior to January 1, 2018.

"[9] Section 24.03 is modified to clarify that SB/SE Exam will be notified if a request for an extension of time for making an election or other application for relief under Section 301.9100-1 is submitted when the return is under examination....

"[11] Section 30.07(2) is modified to provide that beginning April 1, 2019, VCP submissions and the applicable user fees must be made using Section 30.07(3) is modified to clarify that the payment of user fees for pre-approved plan submissions and letter ruling requests may not be made using and that such requests must still be accompanied by a check in the amount of the applicable user fee....

"[15] Appendix A .06(1)(c) is modified to reflect that the user fee for Form 5310 will increase from $2,300 to $3,000 for submissions postmarked on or after July 1, 2019." (Internal Revenue Service [IRS])

[Guidance Overview] Puerto Rico Qualified Plans Must Adopt Hurricane Maria Tax Relief Provisions by December 31, 2018
"Although the amendment is not considered a 'qualification amendment,' and therefore, it does not have to be filed with the Puerto Rico Treasury Department for an updated determination letter, it must be timely adopted to ratify the tax relief benefits granted on such eligible distributions and loans." (McConnell Valdes)
IRS Releases 2018 Required Amendments List for Qualified Retirement Plans
"Certain annual, monthly, or other periodic changes to amounts and items are considered to be included on the RA List for the year in which the changes are effective, even if not directly referenced on the RA List.... [T]he IRS expects that few plans have provisions that need to be amended for these changes." (Findley)
2018 End of Year Plan Sponsor 'To Do' List: Qualified Retirement Plans
Action Items for: [1] All qualified plans; [2] Section 401(k) plans; [3] Defined contribution plans (other than Section 401(k) plans); [4] Defined benefit plans; and [5] Section 403(b) plans. (Snell & Wilmer)
[Official Guidance] Text of IRS FAQs on 403(b) Pre-Approved Plan Program: Eligible Adopting Employers and Reliance on Letters
"Who can adopt a 403(b) prototype or volume submitter specimen plan? ... What is an IRS opinion or advisory letter for a 403(b) pre-approved plan? ... To what extent can an adopting employer rely on a 403(b) prototype plan's opinion letter? ... To what extent can an adopting employer rely on a 403(b) volume submitter plan's advisory letter?" (Internal Revenue Service [IRS])
[Guidance Overview] IRS Issues Proposed Regs for Hardship Distributions
"[1] Clarification of Code Section 165 casualty loss deduction ... [2] Additional safe harbor for certain disasters ... [3] Extension of relief for victims of Hurricanes Florence and Michael ... [4] Elimination of six-month suspension period ... [5] Elimination of requirement that participant take all available plan loans ... [6] Expansion of available sources ... [7] Elimination of 'facts and circumstances' test ... [8] Plan amendment deadlines." (Ice Miller LLP)
Year-End Considerations for Retirement Plans, Part 2
"Plan sponsors may use forfeitures to fund QMACs and QNECs ... Plan sponsors may expand 401(k) and 403(b) hardship provisions ... Plan limits ... PBGC premium increases." (Morgan Lewis)
[Official Guidance] Text of IRS Form 4461: Application for Approval of Standardized or Nonstandardized Pre-Approved Defined Contribution Plans (PDF)
Rev. Nov. 2018. "Form 4461 is used to apply for approval of standardized or nonstandardized pre-approved defined contribution plans.... A provider or mass submitter of a pre-approved defined contribution plan may file a Form 4461." (Internal Revenue Service [IRS])
[Official Guidance] Text of IRS Form 4461-B: Application for Approval of Standardized or Nonstandardized Pre-Approved Plans (PDF)
Rev. Nov. 2018. "Use Form 4461-B to apply for approval of a plan submitted by a mass submitter on behalf of an adopting provider, which is based on a plan submitted by the mass submitter.... Only mass submitters may file this form." (Internal Revenue Service [IRS])
Year-End Considerations for Retirement Plans, Part 1: Closing Out 2018
"[1] The IRS Required Amendment list ... [2] Qualified 2016 disaster distributions ... [3] Safe harbor 401(k) plans ... [4] Claims and appeals rules regarding disability benefits.... [5] Participant notices." (Morgan Lewis)
IRS Reminder: Pre-Approved Filing Deadline Rapidly Approaching
"The on-cycle filing deadline for third cycle pre-approved defined contribution plans ends December 31, 2018. Please note the changes to the mailing address and shortened response times for follow-up requests for third cycle applications." (Internal Revenue Service [IRS])
[Official Guidance] Text of IRS Notice 2018-91: 2018 Required Amendments List for Qualified Retirement Plans (PDF)
"[The] RA List does not include guidance issued or legislation enacted after the list has been prepared and also does not include: [1] Statutory changes in qualification requirements for which the Treasury Department and the IRS expect to issue guidance ... [2] Changes in qualification requirements that permit (but do not require) optional plan provisions.... [3] Changes in the tax laws affecting qualified plans that do not change the qualification requirements under Section 401(a) ... There are no entries listing changes in qualification requirements on the 2018 RA List." (Internal Revenue Service [IRS])
[Official Guidance] Text of IRS Form 8717-A: User Fee for Employee Plan Opinion Letter Request (PDF)
Rev. Sept. 2018. "What's New: Specific user fee amounts are no longer listed on Form 8717-A. You must now enter the appropriate user fee when completing line 5." [Also available as a fillable PDF form.] (Internal Revenue Service [IRS])
2019 Planning for ERISA Single-Employer Defined Contribution Plan Operations (PDF)
"[This calendar] will help you set up your own schedule of activities to address as the year progresses so that you do not miss important deadlines for your qualified plans.... [The companion] Reporting and Disclosure Guide will help you identify and address other activities that are event-based and participant-specific.... [This article also discusses] several key issues for you to consider (along with the calendar deadlines) as we head into 2019." (Buck)
Significant Changes in VCP Fees Affect Small Benefit Plans
"For plans with 1‑50 participants that would have paid a VCP fee of $500-$750, ... effective January 2, 2018 ... Rev. Proc. 2018‑4 ...upended the VCP fee schedule in favor of a model based on assets with a minimum fee of $1,500 that doubled or tripled what they would have paid even one day earlier.... [T]he transition of VCP fees is summarized [in chart form]." (Belfint Lyons Shuman)
[Guidance Overview] IRS Announces Submission Extension for Cycle 3 Pre-Approved Defined Contribution Plans (PDF)
"Among the issues that the IRS [still] needs to address are: [1] Clarifications on the extent of reliance on an opinion letter; [2] The new requirement to exclude the trust provisions from a pre-approved plan document; [3] Issues relating to interim amendments; [4] The need for updated submission forms; [5] Guidance on Church Plan provisions. Without clarification from the IRS, these issues will make Cycle 3 plan document submissions uncertain and more time consuming for document drafters and adopters." (ASC)
Affected Parties Suggest Reasons, Methods for Expanding IRS Determination Letter Program
"The circumstances believed to warrant determination letter applications included: [1] Significant legislative and regulatory changes; [2] Significant plan design changes; and [3] Mergers and acquisitions.... Under one suggested approach for obtaining an IRS stamp of approval, the agency would establish or provide official recognition of a third-party certification system to fill the void left when it contracted the determination letter program -- an idea that the IRS raised years ago in a 2001 White Paper." (HR Daily Advisor)
Stakeholders Propose Ideas for Expanding the Determination Letter Program
"The main themes in comments from employee benefits trade organizations ... included: [1] Significant legislative and regulatory changes ... [2] Significant plan design changes ... [3] Mergers and acquisitions ... The comments also included recommendations on other avenues for obtaining the IRS stamp of approval[:] Third-party certification ... Letter rulings ... [and] Limited scope reviews." (Conduent)
[Guidance Overview] IRS Umbrella Closing Agreement Program Available to Correct Missed Deadlines
"Financial institutions and providers can still make corrections through the Voluntary Correction Program. However, with the umbrella closing agreement option, there does not have to be a system-wide error. Instead, this allows the financial institution to seek correction across a group of employers. An umbrella closing agreement correction can be more cost-effective and simpler for providers looking to make group corrections." (Butterfield Schechter LLP)
IRS Appears Likely to Expand Determination Letter Program in 2019
"The end of the [cycle-based program in 2017] left plan sponsors with no way to obtain a confirmation from the IRS that their plans continued to satisfy the formal requirements for qualification after multiple amendments and changes to the law. Based on recent IRS announcements, however, it appears that individually designed plans will have restored access to the program, possibly as soon as next year." (Verrill Dana LLP)
[Official Guidance] Text of IRS Form 14568-B: Model VCP Compliance Statement -- Schedule 2: Other Nonamender Failures and Failure to Adopt a 403(b) Plan Timely (PDF)
"The plan identified above was not amended to comply with the applicable provisions of the following legislative and regulatory requirements by the applicable deadlines in accordance with Internal Revenue Code (IRC) Section 401(b) and the regulations thereunder[.]" [Rev. June 2018] (Internal Revenue Service [IRS])
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