IRS Issues 2019 Procedures for Retirement Plan Determination Letters, Rulings, Other Guidance

Procedures for Retirement Plan Determination Letters, Rulings, Other Guidan

Rev. Proc. 2019-4 contains annual updates to IRS procedures for requesting determination letters, private letter rulings, and other tax advice on employee plan matters. Here are highlights of some key changes to last year's procedures. 

Determination letters

The updated procedures include these changes for determination letters applications:

  • Availability of determination letters. Section 8.02 now reflects that plan sponsors may request determination letters regarding not only initial plan qualification and termination (by submitting Form 5300), but also "other circumstances" permitted by IRS. Last year, IRS requested input on what other circumstances might warrant broadening the determination letter program.
  • No determinations of controlled-group status. Section 8.03 adds controlled-group and affiliated service-group status under Code Sections 414(b), (c) and (m) to the list of provisions for which IRS won’t issue a determination letter.
  • Nondiscriminatory compensation for design-based safe harbor plans. Section 9.03 states that IRS won’t determine whether a plan satisfies a design-based nondiscrimination safe harbor under Treas. Reg. Section 1.401(a)(4)-2(b) or 1.401(a)(4)-3(b) unless the plan uses a nondiscriminatory definition of compensation that satisfies Treas. Reg. Section 1.414(s)-1(c).
  • Reference list dropped. Section 10 no longer includes a paragraph encouraging applicants to include a reference list identifying the location in their plan documents for items on any applicable Required Amendments (RA) List or Cumulative List.

Other changes

Notable changes for other requests include:

  • Voluntary closing agreements. Section 4 reflects IRS's practice of considering voluntary requests for closing agreements to resolve certain income or excise tax issues that are ineligible for resolution under the Employee Plans Compliance Resolution System (EPCRS).
  • No faxed requests for letter rulings. Requests for letter rulings may no longer be submitted by fax. Former Section 6.03(4)(b), which used to permit requests by fax, has been deleted.
  • VCP submissions. Section 30.07(2) states that starting April 1, sponsors must submit Voluntary Correction Program (VCP) applications under EPCRS and the applicable user fees through However, user fees for preapproved plan submissions and letter ruling requests still must be paid by check enclosed with the application.
  • July user fee hike. Appendix A.06(1)(c) reflects that the user fee for a terminating plan’s determination letter will increase to $3,000 (from $2,300) for submissions postmarked on or after July 1.
Margaret Berger
by Margaret Berger

Principal, Mercer’s Law & Policy Group

Brian Kearney
by Brian Kearney

Principal, Mercer’s Law & Policy Group

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