IRS Revenue Procedure
2002-6

Code Sec. NONE

Status: Modified by 2002-29, Modified by 2002-21


<<FULL TEXT>>

Status: Modified by Notice 2002-1


26 CFR 601.201: Rulings and determination letters.


REV. PROC. 2002-6

TABLE OF CONTENTS

SECTION 1. WHAT IS THE PURPOSE OF THIS REVENUE PROCEDURE?
.01 Purpose of revenue procedure
.02 Organization of revenue procedure

SECTION 2. WHAT CHANGES HAVE BEEN MADE TO THIS PROCEDURE?
.01 In general
.02 Announcement 2001-77
.03 EGTRRA and CRA
.04 Evidence of eligibility for extended remedial amendment period
.05 Clarification of the definition of a volume submitter plan
.06 Notice to interested parties


PART I. PROCEDURES FOR DETERMINATION LETTER REQUESTS

SECTION 3. ON WHAT ISSUES MAY TAXPAYERS REQUEST WRITTEN GUIDANCE UNDER
THIS PROCEDURE?
.01 Types of requests
.02 Areas in which determination letters will not be issued
.03 EGTRRA and CRA

SECTION 4. ON WHAT ISSUES MUST WRITTEN GUIDANCE BE REQUESTED UNDER
DIFFERENT PROCEDURES?
.01 Tax Exempt and Government Entities
.02 Chief Counsel's revenue procedure

SECTION 5. WHAT IS THE GENERAL SCOPE OF A DETERMINATION LETTER?
.01 Scope of this section
.02 Scope of determination letters
.03 Nondiscrimination in amount requirement
.04 Minimum coverage and section 401(a)(26) participation requirements
.05 Nondiscriminatory current availability requirement
.06 Other nondiscrimination requirements
.07 Reliance conditioned on retention of information
.08 Effective availability requirement
.09 Other limits on scope of determination letter
.10 Publication 794

SECTION 6. WHAT IS THE GENERAL PROCEDURE FOR REQUESTING DETERMINATION
LETTERS?
.01 Scope
.02 Qualified trusteed plans
.03 Qualified nontrusteed annuity plans
.04 Complete information required
.05 Complete copy of plan and trust required
.06 Section 9 of Rev. Proc. 2002-4 applies
.07 Separate application required for each single section 414(l) plan
.08 Coverage and nondiscrimination requirements
.09 Prior letters
.10 Reliance on section 19 of Rev. Proc. 2000-20
.11 User fees
.12 Interested party notification and comment
.13 Contrary authority must be distinguished
.14 Employer/employee relationship
.15 Incomplete applications returned
.16 Effect of failure to disclose material fact
.17 Data requirements
.18 Where to file request
.19 Withdrawal of requests
.20 Right to status conference
.21 How to request status conference

SECTION 7. INITIAL QUALIFICATION, ETC.
.01 Scope
.02 Forms
.03 Application for amendments must include copy of plan
.04 Restatements may be required
.05 Controlled groups, etc.

SECTION 8. EMPLOYER RELIANCE ON M&P AND VOLUME SUBMITTER PLANS
.01 Scope
.02 Standardized M&P plans
.03 Nonstandardized M&P plans and volume submitter plans
.04 Other limitations and conditions on reliance
.05 Reliance equivalent to determination letter

SECTION 9. ADVISORY LETTER AND DETERMINATION LETTER FILING PROCEDURES FOR
M&P AND VOLUME SUBMITTER PLANS
.01 Scope
.02 Description of volume submitter program
.03 Definition of volume submitter plan
.04 Incorporation by reference
.05 User fees
.06 Advisory letter for specimen plan
.07 Requests for information
.08 Determination letter for adoption of volume submitter plan
.09 Determination letter for adoption of M&P plan
.10 Required information
.11 Amended plan is treated as an individually designed plan
.12 Requests made prior to the issuance of opinion letter

SECTION 10. MULTIPLE EMPLOYER PLANS
.01 Scope
.02 Option to file for the plan only or for both the plan and
employers maintaining the plan
.03 Where to file
.04 Determination letter sent to each employer who files Form 5300
.05 Addition of employers

SECTION 11. MINOR AMENDMENT OF PREVIOUSLY APPROVED PLAN
.01 Scope
.02 Form 6406
.03 Additional information
.04 Minor amendment procedures may not be used for complex amendments
or GUST letter
.05 EP Determinations has discretion to determine whether use of minor
amendment procedure is appropriate

SECTION 12. TERMINATION OR DISCONTINUANCE OF CONTRIBUTIONS; NOTICE OF
MERGERS, CONSOLIDATIONS, ETC.
.01 Scope
.02 Forms
.03 Supplemental information
.04 Required demonstration of nondiscrimination requirements
.05 Compliance with Title IV of ERISA
.06 Termination prior to time for amending for change in law

SECTION 13. GROUP TRUSTS
.01 Scope
.02 Required information

SECTION 14. AFFILIATED SERVICE GROUPS; LEASED EMPLOYEES
.01 Scope
.02 Types of requests under section 414(m) and section 414(n)
.03 Employer must request the determination under section 414(m) or
section 414(n)
.04 Forms
.05 Employer is responsible for determining status under section
414(m) and section 414(n)
.06 Omission of material fact
.07 Service will indicate whether section 414(m) or section 414(n)
was considered
.08 M&P plans
.09 Required information for section 414(m) determination
.10 Required information for section 414(n) determination

SECTION 15. WAIVER OF MINIMUM FUNDING
.01 Scope
.02 Applicability of Rev. Proc. 94-41
.03 Waiver and determination letter request submitted to EP Technical
.04 Handling of the request
.05 Interested party notice and comment
.06 When waiver request should be submitted

SECTION 16. SECTION 401(h) AND SECTION 420 DETERMINATION LETTERS
.01 Scope
.02 Required information for section 401(h) determination
.03 Required information for section 420 determination


PART II. INTERESTED PARTY NOTICE AND COMMENT

SECTION 17. WHAT RIGHTS TO NOTICE AND COMMENT DO INTERESTED PARTIES HAVE?
.01 Rights of interested parties
.02 Comments by interested parties
.03 Requests for DOL to submit comments
.04 Right to comment if DOL declines to comment
.05 Confidentiality of comments
.06 Availability of comments
.07 When comments are deemed made

SECTION 18. WHAT ARE THE GENERAL RULES FOR NOTICE TO INTERESTED PARTIES?
.01 Notice to interested parties
.02 Time when notice must be given
.03 Content of notice
.04 Procedures for making information available to interested parties
.05 Information to be available to interested parties
.06 Special rules if there are less than 26 participants
.07 Information described in section 6104(a)(1)(D) should not be
included
.08 Availability of additional information to interested parties
.09 Availability of notice to interested parties


PART III. PROCESSING DETERMINATION LETTER REQUESTS

SECTION 19. HOW DOES THE SERVICE HANDLE DETERMINATION LETTER REQUESTS?
.01 Oral advice
.02 Conferences
.03 Determination letter based solely on administrative record
.04 Notice of final determination
.05 Issuance of the notice of final determination

SECTION 20. EXHAUSTION OF ADMINISTRATIVE REMEDIES
.01 In general
.02 Steps for exhausting administrative remedies
.03 Applicant's request for section 7805(b) relief
.04 Interested parties
.05 Deemed exhaustion of administrative remedies
.06 Service must act on appeal
.07 Service must act on section 7805(b) request
.08 Effect of technical advice request

SECTION 21. WHAT EFFECT WILL AN EMPLOYEE PLAN DETERMINATION LETTER HAVE?
.01 Scope of reliance on determination letter
.02 Effect of determination letter on minor plan amendment
.03 Sections 13 and 14 of Rev. Proc. 2002-4 applicable
.04 Effect of subsequent publication of revenue ruling, etc.
.05 Determination letter does not apply to taxability issues

SECTION 22. EFFECT ON OTHER REVENUE PROCEDURES

SECTION 23. EFFECTIVE DATE

SECTION 24. PAPERWORK REDUCTION ACT

DRAFTING INFORMATION

EXHIBIT

APPENDIX SECTIONS 401(h) AND 420 DETERMINATION LETTERS


SECTION 1. WHAT IS THE PURPOSE OF THIS REVENUE PROCEDURE?

PURPOSE OF REVENUE PROCEDURE

.01 This revenue procedure sets forth the procedures of the various
offices of the Internal Revenue Service for issuing determination letters
on the qualified status of pension, profit-sharing, stock bonus, annuity,
and employee stock ownership plans (ESOPs) under sections 401, 403(a), 409
and 4975(e)(7) of the Internal Revenue Code of 1986, and the status for
exemption of any related trusts or custodial accounts under section
501(a).


ORGANIZATION OF REVENUE PROCEDURE

.02 Part I of this revenue procedure contains instructions for
requesting determination letters for various types of plans and
transactions. Part II contains procedures for providing notice to
interested parties and for interested parties to comment on determination
letter requests. Part III contains procedures concerning the processing of
determination letter requests and describes the effect of a determination
letter.


SECTION 2. WHAT CHANGES HAVE BEEN MADE TO THIS PROCEDURE?

IN GENERAL

.01 This revenue procedure is a general update of Rev. Proc. 2001-6,
2001-1 I.R.B. 194, which contains the Service's general procedures for
employee plans determination letter requests. Most of the changes to Rev.
Proc. 2001-6 involve minor revisions, such as updating citations to other
revenue procedures.


ANNOUNCEMENT 2001-77

.02 In Announcement 2001-77, the Service described several changes to
simplify the employee plans determination letter application procedures.
One of the changes gives plan sponsors the flexibility to request a
determination letter that considers either the form of the plan only or
both the form of the plan and compliance with the minimum coverage and
nondiscrimination requirements. A second change enables adopters of
nonstandardized master and prototype (M&P) plans and volume submitter
specimen plans to rely on the M&P or volume submitter specimen plan's
favorable opinion or advisory letter without having to request individual
determination letters. A third change enables employers that maintain
multiple employer plans to rely on the favorable determination letter
issued for the plan without having to request individual determination
letters. Finally, Announcement 2001-77 provides certain transition rules
that allow plan sponsors to file determination letter applications using
the prior revision of the determination letter application forms.
Announcement 2001-122, 2001-51 I.R.B. 604, extended these transition rules
through March 31, 2002. The changes described in Announcement 2001-77 and
Announcement 2001-155 have been incorporated in this revenue procedure.


EGTRRA AND CRA

.03 The Economic Growth and Tax Relief Reconciliation Act of 2001
(EGTRRA), Pub. L. 107-16, which was enacted on June 7, 2001, includes
numerous changes to the qualified plan rules. Almost all of these changes
are effective in years beginning after December 31, 2001. While many of
the changes are not mandatory, a plan sponsor that chooses to implement an
optional provision of EGTRRA will have to amend its plan to conform plan
provisions to plan operation. Notice 2001-42, 2001-30 I.R.B. 70, provides
that good faith plan amendments for EGTRRA must be adopted no later than
the later of (1) the end of the plan year in which the amendments are
required to be, or are optionally, put into effect or (2) the end of the
GUST <<ENDNOTE 1>> remedial amendment period. Notice 2001-57, 2001-38
I.R.B. 279 provides sample amendments to assist plan sponsors in meeting
this requirement. Notice 2001-42 also provides that until further notice
determination, opinion and advisory letters will not consider and may not
be relied on with respect to the EGTRRA changes. However, an employer's
ability to rely on a favorable determination, opinion or advisory letter
will not be adversely affected by the timely adoption of good faith EGTRRA
plan amendments. Determination letters consider and may be relied on with
respect to the changes to the qualification requirements made by the
Community Renewal Tax Relief Act of 2000 (CRA), Pub. L. 106-554. Section 3
of this revenue procedure has been modified to incorporate this provision
of Notice 2001-42. Section 3 has also been modified to provide that
determination letters consider and may be relied on with respect to the
changes to the qualification requirements made by CRA.


EVIDENCE OF ELIGIBILITY FOR EXTENDED REMEDIAL AMENDMENT PERIOD UNDER
SECTION 19 OF REV. PROC. 2000-20

.04 Section 6 has been modified to require the submission of
appropriate evidence of eligibility for the extension of the remedial
amendment period under section 19 of Rev. Proc. 2000-20 in cases where the
determination letter application is filed after the time the period would
otherwise expire.


CLARIFICATION OF THE DEFINITION OF A VOLUME SUBMITTER PLAN

.05 Section 9.03 is clarified to reflect that the definition of a
volume submitter plan does not include a cash balance or similar defined
benefit plan.


NOTICE TO INTERESTED PARTIES

.06 Proposed amendments to section 1.7476-2 of the Income Tax
Regulations and section 601.201 of the Statement of Procedural Rules,
relating to notice to interested parties, were published in the Federal
Register on January 17, 2001, 66 F.R. 3954. The proposed regulations
provide greater flexibility in the manner in which the notice may be
provided, including use of electronic media. Because the regulations are
proposed to be effective with respect to applications made on or after the
date the regulations are published in the Federal Register as final
regulations, the provisions of this revenue procedure relating to notice
to interested parties have not been amended at this time. However, plan
sponsors may rely on the proposed regulations for guidance pending the
issuance of final regulations.


<<ENDNOTES>>

1/ The term "GUST" refers to the following:

* the Uruguay Round Agreements Act, Pub. L. 103-465;

* the Uniformed Services Employment and Reemployment Rights Act of
1994, Pub. L. 103-353;

* the Small Business Job Protection Act of 1996, Pub. L. 104-188;

* the Taxpayer Relief Act of 1997, Pub. L. 105-34;

* the Internal Revenue Service Restructuring and Reform Act of 1998,
Pub. L. 105-206; and

* the Community Renewal Tax Relief Act of 2000, Pub. L. 106-554.


PART I. PROCEDURES FOR DETERMINATION LETTER REQUESTS

SECTION 3. ON WHAT ISSUES MAY TAXPAYERS REQUEST WRITTEN GUIDANCE UNDER
THIS PROCEDURE?

TYPES OF REQUESTS

.01 Determination letters may be requested on completed and proposed
transactions as set forth in the table below:

Rev. Proc.
Type of Request Forms Section
--------------- ----- ----------
1. INITIAL QUALIFICATION, ETC.
a. Initially-Designed Plans 5300, 7
including collectively Schedule Q (optional)
bargained plans)

b. ESOPs 5300, 5309 7
Schedule Q (optional)

c. Adoptions of Master & 5307, 8
Prototype Plans Schedule Q (optional)

d. Adoptions of Volume 5300, 7
Submitter Plans Schedule Q (optional)

e. Multiple Employer Plans 5300, 10
Schedule Q (optional)

f. Group Trusts Cover letter 13

2. MINOR AMENDMENTS 6406 11

3. TERMINATION
a. In general 5310, 6088, 12
Schedule Q (optional)

b. Multiemployer plan 5300, 6088, 12
covered by PBGC Schedule Q (optional)
insurance

Note: Form 5310-A, Notice of Plan Merger, Consolidation, Spinoff or
Transfer of Plan Assets or Liabilities-Notice of Qualified Separate Lines
of Business generally must be filed not less than 30 days before the
merger, consolidation or transfer of assets and liabilities. The filing of
Form 5310-A will not result in the issuance of a determination letter.

4. SPECIAL PROCEDURES
a. Affiliated Service Group 5300, 14
Status (section 414(m)), Schedule Q (optional)
Leased Employees
(section 414(n))

b. Minimum Funding Waiver 5300, 15
Schedule Q (optional)

c. Section 401(h) 5300, 16
Determination Letters Schedule Q (optional)

d. Section 420 5300, 16
Determination Letters Schedule Q (optional),
Including Other Matters Cover letter, Checklist
Under section 401(a)

e. Section 420 Cover letter, 16
Determination Letters Checklist
Excluding Other Matters
Under section 401(a)

<<END RULING>>



AREAS IN WHICH DETERMINATION LETTERS WILL NOT BE ISSUED

.02 Determination letters issued in accordance with this revenue
procedure do not include determinations on the following issues within the
jurisdiction of the Commissioner, TE/GE:

(1) Issues involving sections 72, 79, 105, 125, 127, 129, 402, 403
(other than 403(a)), 404, 409(l), 409(m), 412, 457, 511 through 515, and
4975 (other than 4975(e)(7)), unless these determination letters are
authorized under section 7 of Rev. Proc. 2002-4, page 127, this Bulletin.

(2) Plans or plan amendments for which automatic approval is granted
pursuant to section 8.05 below.

(3) Plan amendments described below (these amendments will, to the
extent provided, be deemed not to alter the qualified status of a plan
under section 401(a)).

(a) An amendment solely to permit a trust forming part of a plan to
participate in a pooled fund arrangement described in Rev. Rul. 81-100,
1981-1 C.B. 326;

(b) An amendment that merely adjusts the maximum limitations under
section 415 to reflect annual cost-of-living increases, other than an
amendment that adds an automatic cost-of-living adjustment provision to
the plan; and

(c) An amendment solely to include language pursuant to section
403(c)(2) of Title I of the Employee Retirement Income Security Act of
1974 (ERISA) concerning the reversion of employer contributions made as a
result of mistake of fact.


(4) This section applies to determination letter requests with respect
to plans that combine an ESOP (as defined in section 4975(e)(7) of the
Code) with retiree medical benefit features described in section 401(h)
(HSOPs).

(a) In general, determination letters will not be issued with respect
to plans that combine an ESOP with an HSOP with respect to:

(i) whether the requirements of section 4975(e)(7) are satisfied;

(ii) whether the requirements of section 401(h) are satisfied; or

(iii) whether the combination of an ESOP with an HSOP in a plan
adversely affects its qualification under section 401(a).


(b) A plan is considered to combine an ESOP with an HSOP if it contains
ESOP provisions and section 401(h) provisions.

(c) However, an arrangement will not be considered covered by section
3.02(4) of this revenue procedure if, under the provisions of the plan,
the following conditions are satisfied:

(i) No individual accounts are maintained in the section 401(h) account
(except as required by section 401(h)(6));

(ii) No employer securities are held in the section 401(h) account;

(iii) The section 401(h) account does not contain the proceeds
(directly or otherwise) of an exempt loan as defined in section
54.4975-7(b)(1)(iii) of the Pension Excise Tax Regulations; and

(iv) The amount of actual contributions to provide section 401(h)
benefits (when added to actual contributions for life insurance protection
under the plan) does not exceed 25 percent of the sum of: (1) the amount
of cash contributions actually allocated to participants' accounts in the
plan and (2) the amount of cash contributions used to repay principal with
respect to the exempt loan, both determined on an aggregate basis since
the inception of the section 401(h) arrangement.


EGTRRA AND CRA

.03 As provided in Notice 2001-42, until further notice, determination,
opinion and advisory letters will not consider and may not be relied on
with respect to whether a plan satisfies the qualification requirements of
the Code as amended by EGTRRA. However, an employer's ability to rely on a
favorable determination, opinion or advisory letter will not be adversely
affected by the timely adoption of good faith EGTRRA plan amendments.
Determination letters consider and may be relied on with respect to
whether a plan satisfies the qualification requirements of the Code as
amended by CRA.


SECTION 4. ON WHAT ISSUES MUST WRITTEN GUIDANCE BE REQUESTED UNDER
DIFFERENT PROCEDURES?

TE/GE

.01 Other procedures for obtaining rulings, determination letters,
opinion letters, etc., on matters within the jurisdiction of the
Commissioner, TE/GE are contained in the following revenue procedures:

(1) Employee Plans Technical (EP Technical) letter rulings, information
letters, etc.: See Rev. Proc. 2002-4.

(2) M&P plans: See Rev. Proc. 2000-20, as modified by Rev. Proc.
2000-27, Notice 2001-42, and Rev. Proc. 2001-55, 2001-49 I.R.B. 552.

(3) Technical advice requests: See Rev. Proc. 2002-5, page 173, this
Bulletin.


CHIEF COUNSEL'S REVENUE PROCEDURE

.02 For the procedures for obtaining letter rulings, determination
letters, etc., on matters within the jurisdiction of the Division
Counsel/Associate Chief Counsel (Tax Exempt and Government Entities), or
within the jurisdiction of other offices of Chief Counsel, see Rev. Proc.
2002-1, page 1, this Bulletin.


SECTION 5. WHAT IS THE GENERAL SCOPE OF A DETERMINATION LETTER?

SCOPE OF THIS SECTION

.01 This section delineates, generally, the scope of an employee plan
determination letter. It identifies certain qualification requirements,
relating to nondiscrimination, that are considered by the Service in its
review of a plan only at the election of the applicant. This section also
identifies certain qualification requirements that are not considered by
the Service in its review of a plan and with respect to which
determination letters do not provide reliance. This section applies to all
determination letters other than letters issued in response to an
application filed on Form 6406, Short Form Application for Determination
for Minor Amendment of Employee Benefit Plan; letters relating to the
qualified status of group trusts; and letters relating solely to the
requirements of section 420, regarding the transfer of assets in a defined
benefit plan to a health benefit account described in section 401(h). For
additional information pertaining to the scope of reliance on a
determination letter, see sections 9, 10 and 21 of this revenue procedure.


SCOPE OF DETERMINATION LETTERS

.02 In general, employee plans are reviewed by the Service for
compliance with the form requirements (that is, those plan provisions that
are required as a condition of qualification under section 401(a)). In
addition, as described below, certain nondiscrimination requirements are
considered if the applicant specifically requests that they be considered.
Unless otherwise stated, a plan is reviewed on the basis of the
requirements that apply to the plan as of the date the application is
received, except for terminating plans. For terminating plans, the
requirements are those that apply as of the date of termination.


NONDISCRIMINATION IN AMOUNT REQUIREMENTS

.03 Unless the applicant elects otherwise, a plan will not be reviewed
for, and a determination letter may not be relied on with respect to,
whether a plan satisfies one of the safe harbors or the general test for
nondiscrimination in amount of contributions or benefits requirements
under section 1.401(a)(4)-1(b)(2) of the Income Tax Regulations.


MINIMUM COVERAGE AND SECTION 401(a)(26) PARTICIPATION REQUIREMENTS

.04 Unless the applicant elects otherwise, a plan will not be reviewed
for, and a determination letter may not be relied on with respect to, the
minimum coverage requirements of section 410(b). If the applicant
demonstrates that the plan satisfies the coverage requirements of section
410(b), the determination letter may also be relied on with respect to the
participation requirements of section 401(a)(26).


NONDISCRIMINATORY CURRENT AVAILABILITY REQUIREMENT

.05 If the applicant demonstrates that the plan satisfies the coverage
requirements of section 410(b), the determination letter may also be
relied on as to whether the plan satisfies the nondiscriminatory current
availability requirements of section 1.401(a)(4)-4(b) with respect to
those benefits, rights, and features that are currently available (within
the meaning of section 1.401(a)(4)-4(b)(2)) to all employees in the plan's
coverage group. The plan's coverage group consists of those employees who
are treated as currently benefiting under the plan (within the meaning of
section 1.410(b)-3(a)) for purposes of demonstrating that the plan
satisfies the minimum coverage requirements of section 410(b).
Applications will not be reviewed for, and determination letters may not
be relied on with respect to, whether the plan satisfies the requirements
of section 1.401(a)(4)-4(b) with respect to any benefit, right, or feature
other than the ones described above, except those that are specified by
the applicant and for which the applicant has provided information
relevant to the determination.


OTHER NONDISCRIMINATION REQUIREMENTS

.06 An applicant may also ask that the review of its plan consider
certain other nondiscrimination requirements which are described in
Schedule Q (Form 5300), such as whether a definition of compensation
satisfies section 414(s).


RELIANCE CONDITIONED ON RETENTION OF INFORMATION

.07 A favorable determination letter may be relied on with respect to
whether a plan satisfies a coverage or nondiscrimination requirement only
if the application, demonstrations and other information submitted to the
Service in support of a favorable determination is retained by the
applicant.


EFFECTIVE AVAILABILITY REQUIREMENT

.08 In no event will any plan be reviewed to determine, and a
determination letter may not be relied on with respect to, whether any
benefit, right, or feature under the plan satisfies the effective
availability requirement of section 1.401(a)(4)-4(c).


OTHER LIMITS ON SCOPE OF DETERMINATION LETTER

.09 Determination letters may generally be relied on with respect to
whether the timing of a plan amendment (or series of amendments) satisfies
the nondiscrimination requirements of section 1.401(a)(4)-5(a) of the
regulations, unless the plan amendment is part of a pattern of amendments
that significantly discriminates in favor of highly compensated employees.
A favorable determination letter does not provide reliance for purposes of
section 404 and section 412 with respect to whether an interest rate (or
any other actuarial assumption) is reasonable. Furthermore, a favorable
determination letter will not constitute a determination with respect to
the use of the substantiation guidelines contained in Rev. Proc. 93-42,
1993-2 C.B. 540, e.g., a determination letter will not consider whether
data submitted with an application is substantiation quality. Lastly, a
favorable determination letter will not constitute a determination with
respect to whether any requirements of section 414(r), relating to whether
an employer is operating qualified separate lines of business, are
satisfied. However, if an employer is relying on section 414(r) to satisfy
the minimum coverage or section 401(a)(26) participation requirements, and
the applicant so requests, a determination letter will take into account
whether the plan satisfies the nondiscriminatory classification test of
section 410(b)(5)(B). In this case, if the requirements of section 410(b)
or section 401(a)(26) are to be applied on an employer-wide basis under
the special rules for employer-wide plans, a determination letter will
take into account whether the requirements of the applicable special rule
set forth in section 1.414(r)-1(c)(2)(ii) or section 1.414(r)-1(c)(3)(ii)
are met.


PUBLICATION 794

.10 Publication 794, Favorable Determination Letter, contains other
information regarding the scope of a determination letter, including the
requirement that all information submitted with the application be
retained as a condition of reliance. In addition, the specific terms of
each letter may further define its scope and the extent to which it may be
relied upon.


SECTION 6. WHAT IS THE GENERAL PROCEDURE FOR REQUESTING DETERMINATION
LETTERS?

SCOPE

.01 This section contains procedures that are generally applicable to
all determination letter requests. Additional procedures for specific
requests are contained in sections 7 through 16.


QUALIFIED TRUSTEED PLANS

.02 A trust created or organized in the United States and forming part
of a pension, profit-sharing, stock bonus or annuity plan of an employer
for the exclusive benefit of its employees or their beneficiaries that
meets the requirements of section 401 is a qualified trust and is exempt
from federal income tax under section 501(a) unless the exemption is
denied under section 502, relating to feeder organizations, or section
503, relating to prohibited transactions, if, in the latter case, the plan
is one described in section 503(a)(1)(B).


QUALIFIED NONTRUSTEED ANNUITY PLANS

.03 A nontrusteed annuity plan that meets the applicable requirements
of section 401 and other additional requirements as provided under section
403(a) and section 404(a)(2), (relating to deductions of employer
contributions for the purchase of retirement annuities), qualifies for the
special tax treatment under section 404(a)(2), and the other sections of
the Code, if the additional provisions of such other sections are also
met.


COMPLETE INFORMATION REQUIRED

.04 An applicant requesting a determination letter must file the
material required by this revenue procedure with the Employee Plans
Determinations manager (EP Determinations) at the address in section 6.18.
The filing of the application, when accompanied by all information and
documents required by this revenue procedure, will generally serve to
provide the Service with the information required to make the requested
determination. However, in making the determination, the Service may
require the submission of additional information. Information submitted to
the Service in connection with an application for determination may be
subject to public inspection to the extent provided by section 6104.


COMPLETE COPY OF PLAN AND TRUST INSTRUMENT REQUIRED

.05 Except in the case of applications involving master and prototype
plans filed on Form 5307, or minor amendments described in section 11, a
complete copy of the plan and trust instrument is required to be included
with the determination letter application. See sections 7.03 and 7.04 for
what must be included with applications involving plan amendments that are
not minor amendments.


SECTION 9 OF REV. PROC. 2001-4 APPLIES

.06 Section 9 of Rev. Proc. 2002-4 is generally applicable to requests
for determination letters under this revenue procedure.


SEPARATE APPLICATION FOR EACH SINGLE SECTION 414(l) PLAN

.07 A separate application is required for each single plan within the
meaning of section 414(l). This requirement does not pertain to
applications regarding the qualified status of group trusts.


COVERAGE AND NONDISCRIMINATION REQUIREMENTS

.08 An applicant may request that the plan be reviewed to determine
that the ratio percentage test of section 410(b)(1) is satisfied or that
the plan satisfies one of the design-based safe harbors under section
401(a)(4) by completing the appropriate elective lines on Form 5300 or
Form 5307. Schedule Q (Form 5300) may be filed with the application, other
than an application filed on Form 6406, to request consideration of the
general test under section 401(a)(4), the average benefit test of section
410(b)(2), or any of the other requirements described on Schedule Q. The
applicant must include with the application form the material and
demonstrations called for in the instructions to Form 5300 or Form 5307,
and, if applicable, Schedule Q.


PRIOR LETTERS

.09 If the plan has received a favorable determination letter in the
past, the application must include a copy of the latest determination
letter, if available. If the letter is not available, an explanation must
be included with the application.


RELIANCE ON SECTION 19 OF REV. PROC. 2000-20

.10 In general, the remedial amendment period for GUST ends on the
later of February 28, 2002, or the last day of the first plan year
beginning on or after January 1, 2001. Section 19 of Rev. Proc. 2000-20,
as modified, provides an extension of the GUST remedial amendment period
for employers who, by the deadline described in the preceding sentence,
have adopted an M&P or volume submitter plan (a "pre-approved plan") or
certified their intent to adopt a pre-approved plan that has been restated
for GUST. If the requirements for the extension are satisfied, the GUST
remedial amendment period for the employer's plan will not end before the
later of the end of the 12th month beginning after the date on which the
Service issues a GUST opinion or advisory letter for the preapproved plan
or December 31, 2002. As a condition of the extension, a plan that is
eligible for the extension must request a determination letter by the end
of the extended period if a determination letter is required for reliance.
Most adopting employers of M&P plans and many adopting employers of volume
submitter plans will be entitled to at least limited reliance on their
plan's opinion or advisory letter pursuant to section 8 of this revenue
procedure and therefore will not have to request a determination letter as
a condition of the extension. If an employer files an application for the
initial GUST determination letter for a plan in reliance on section 19 of
Rev. Proc. 2000-20 (that is, after the later of February 28, 2002, or the
last day of the first plan year beginning on or after January 1, 2001),
the employer must include with the application evidence of eligibility for
the extension under Rev. Proc. 2000-20. That is, the employer must include
a copy of the prior plan or adoption agreement, including opinion,
advisory and or determination letters, or a copy of a timely completed
certification. The plan sponsor should describe any special circumstances
in a cover letter.


USER FEES

.11 The appropriate user fee, if applicable, must be paid according to
the procedures of Rev. Proc. 2002-8, page 252, this Bulletin. Form 8717,
User Fee for Employee Plan Determination Letter Request, must accompany
each determination letter request.


INTERESTED PARTY NOTIFICATION AND COMMENT

.12 Before filing an application, the applicant requesting a
determination letter must satisfy the requirements of section 3001(a) of
ERISA, and section 7476(b)(2) of the Code and the regulations thereunder,
which provide that an applicant requesting a determination letter on the
qualified status of certain retirement plans must notify interested
parties of such application. The general rules of the Service with respect
to notifying interested parties of requests for determination letters
relating to the qualification of plans involving sections 401 and 403(a)
are set out below in sections 17 and 18 of this revenue procedure.


CONTRARY AUTHORITY MUST BE DISTINGUISHED

.13 If the application for determination involves an issue where
contrary authorities exist, failure to disclose or distinguish such
significant contrary authorities may result in requests for additional
information, which will delay action on the application.


EMPLOYER/EMPLOYEE RELATIONSHIP

.14 The Service ordinarily does not make determinations regarding the
existence of an employer-employee relationship as part of its
determination of the qualification of a plan, but relies on the
applicant's representations or assumptions, stated or implicit, regarding
the existence of such a relationship. The Service will, however, make a
determination regarding the existence of an employer-employee relationship
when so requested by the applicant. In such cases, the application with
respect to the qualification of the plan should be filed in accordance
with the provisions of this revenue procedure, contain the information and
documents in the instructions to the application, and be accompanied by a
completed Form SS-8, Determination of Employee Work Status for Purposes of
Federal Employment Taxes and Income Tax Withholding, and any information
and copies of documents the organization deems appropriate to establish
its status. The Service may, in addition, require further information that
it considers necessary to determine the employment status of the
individuals involved or the qualification of the plan. After the
employer-employee relationships have been determined, EP Determinations
may issue a determination letter as to the qualification of the plan.


INCOMPLETE APPLICATIONS RETURNED

.15 If an applicant requesting a determination letter does not comply
with all the required provisions of this revenue procedure, EP
Determinations, in its discretion, may return the application and point
out to the applicant those provisions which have not been met. The failure
to provide information required by an application, including any
supplemental information required by the instructions for the application,
may result in the application being returned to the applicant as
incomplete. The request will also be returned pursuant to Rev. Proc.
2002-8 if the correct user fee is not attached. If such a request is
returned to the applicant, the 270-day period described in section
7476(b)(3) will not begin to run until such time as the provisions of this
section have been satisfied.


EFFECT OF FAILURE TO DISCLOSE MATERIAL FACT

.16 The Service may determine, based on the application form, the
extent of review of the plan document. A failure to disclose a material
fact or misrepresentation of a material fact on the application may
adversely affect the reliance which would otherwise be obtained through
issuance by the Service of a favorable determination letter. Similarly,
failure to accurately provide any of the information called for on any
form required by this revenue procedure may result in no reliance.


DATA REQUIREMENTS

.17 The applicant is responsible for the accuracy of any factual
representations and conclusions contained in the application. In some
circumstances, applicants may not be able to use precise data in preparing
demonstrations or schedules that may be required to be submitted with the
application. Therefore, the use of estimated data in these demonstrations
and schedules is not prohibited. In addition, the data used may be for a
prior plan year, provided the following conditions are satisfied: (1) the
data is the most recent data available, (2) there is no misstatement or
omission of material fact with respect to such prior year's data, (3)
there has been no material change in the facts (including a change in the
benefits provided under the plan and employee demographics) since such
prior plan year, (4) the same data is used throughout the application, (5)
the data is relevant to the operational effect of the plan provisions that
are under review, and (6) the applicant clearly discloses that prior
year's data is being submitted with the application. The use of estimated
or prior year's data is not a misrepresentation of material fact. A
determination letter that is based on estimated or prior year's data,
however, may not be relied upon to the extent that such data does not
satisfy the substantiation guidelines in Rev. Proc. 93-42. Regardless of
whether the data is actual or estimated, or whether it is for the current
or a prior year, data that is presented in a determination letter
application must reflect any changes in the law that are considered by the
Service in its determination of the plan's qualified status.


WHERE TO FILE REQUEST

.18 Requests for determination letters are to be addressed to EP
Determinations at the following address:

Internal Revenue Service
P.O. Box 192
Covington, KY 41012-0192


Requests shipped by Express Mail or a delivery service should be sent
to:

Internal Revenue Service
201 West Rivercenter Blvd.
Attn: Extracting Stop 312
Covington, KY 41011


WITHDRAWAL OF REQUESTS

.19 The applicant's request for a determination letter may be withdrawn
by a written request at any time prior to the issuance of a final adverse
determination letter. If an appeal to a proposed adverse determination
letter is filed, a request for a determination letter may be withdrawn at
any time prior to the forwarding of the proposed adverse action to the
chief, appeals office. In the case of a withdrawal, the Service will not
issue a determination of any type. A failure to issue a determination
letter as a result of a withdrawal will not be considered a failure of the
Secretary or his delegate to make a determination within the meaning of
section 7476. However, the Service may consider the information submitted
in connection with the withdrawn request in a subsequent examination.
Generally, the user fee will not be refunded if the application is
withdrawn.


RIGHT TO STATUS CONFERENCE

.20 An applicant for a determination letter has the right to a have a
conference with the EP Determinations manager concerning the status of the
application if the application has been pending at least 270 days. The
status conference may be by phone or in person, as mutually agreed upon.
During the conference, any issues relevant to the processing of the
application may be addressed, but the conference will not involve
substantive discussion of technical issues. No tape, stenographic, or
other verbatim recording of a status conference may be made by any party.
Subsequent status conferences may also be requested if at least 90 days
have passed since the last preceding status conference.

HOW TO REQUEST STATUS CONFERENCE

.21 A request for a status conference with the EP Determinations
manager is to be made in writing and is to be sent to the specialist
assigned to review the application or, if the applicant does not know who
is reviewing the application, to the EP Determinations manager at the
address in section 6.18. If, pursuant to section 15, the application for a
determination letter has been submitted to Employee Plans Technical (EP
Technical) together with a request for a waiver of minimum funding, the
request for a status conference should be sent to the actuary assigned to
review the application or to the Actuarial manager, at the address in
section 15.03. In this case, the right to a status conference will be with
the EP Technical Manager.



SECTION 7. INITIAL QUALIFICATION, ETC.

SCOPE

.01 This section contains the procedures for requesting determination
letters for individually-designed defined contribution and defined benefit
plans including employee stock ownership plans in the following
circumstances:

(1) Initial qualification.

(2) Amendment (other than minor amendments described in section 11
below for which Form 6406 is appropriate).

(3) Restatement of plan.

(4) Qualification of a plan in the event of a partial termination.

(5) Change in scope of determination letter. This means that the
applicant has previously received a favorable determination letter for the
plan and now wishes to modify the scope of the letter, for example, by
requesting the Service to review the plan for certain nondiscrimination
requirements that were not within the scope of the earlier letter.

(6) Other circumstances (excluding plan termination) such as a change
in the demographics of the employer or a change in the method of testing
the plan that was used in a demonstration submitted in support of an
earlier application.


FORMS

.02 A determination letter request for the items listed in section 7.01
is made by filing the appropriate form according to the instructions to
the form and any prevailing revenue procedures, notices, and
announcements.

(1) Form 5300, Application for Determination for Employee Benefit Plan,
must be filed to request a determination letter for individually designed
plans, including collectively bargained plans.

(2) Form 5309, Application for Determination of Employee Stock
Ownership Plan, must be filed as an attachment with a Form 5300 (if the
ESOP is collectively bargained), in order to request a determination
whether the plan is an ESOP under section 409 or section 4975(e)(7).

(3) Schedule Q, (Form 5300), Elective Determination Requests, may be
filed as an attachment with Form 5300 and Form 5303.


APPLICATION FOR AMENDMENTS MUST INCLUDE COPY OF PLAN

.03 Because a plan amendment, other than a minor amendment described in
section 11, may affect other portions of a plan so as to cause plan
disqualification, a determination letter issued on such an amendment to a
plan will express an opinion on the entire plan, as amended. Therefore,
the determination letter application must include a copy of the plan and
trust instrument plus all plan amendments made to the date of the
application. The application must also include a statement explaining how
any amendments made since the last determination letter affect the plan or
any other plan maintained by the employer.


RESTATEMENTS MAY BE REQUIRED

.04 A restated plan is required to be submitted if four or more
amendments (excluding amendments making only non-substantive changes) have
been made since the last restated plan was submitted. In addition, the
Service may require restatement of a plan or submission of a working copy
of the plan in a restated format when considered necessary. For example,
restatement may be required when there have been major changes in law. A
restated plan or a working copy of the plan in a restated format generally
must be submitted for a plan that has not previously received a
determination letter that takes into account all requirements of GUST.
However, see section 3.04 of Rev. Proc. 2000-27 for exceptions to this
requirement.


CONTROLLED GROUPS, ETC.

.05 For a controlled group of corporations as defined in section
414(b), trades or businesses under common control as defined in section
414(c), an affiliated service group within the meaning of section 414(m),
and entities utilizing the services of leased employees within the meaning
of section 414(n), the coverage items on the application forms referred to
in this revenue procedure must be completed as though the controlled
group, commonly controlled trades or businesses, affiliated service group,
etc., constitutes a single entity. Leased employees within the meaning of
section 414(n) must be included as employees of the recipient entity
(except in the case of a safe-harbor plan described in section 414(n)(5)).


SECTION 8. EMPLOYER RELIANCE ON M&P AND VOLUME SUBMITTER PLANS

SCOPE

.01 This section describes the conditions under which, and the extent
to which, adopting employers of M&P and volume submitter plans may rely on
favorable opinion or advisory letters without having to request individual
determination letters. Rev. Proc. 2000-20 describes the requirements that
apply to M&P plans and the procedures for requesting opinion letters on
M&P plans. Section 9 of this revenue procedure describes the requirements
that apply to volume submitter plans and the procedures for requesting
advisory letters on volume submitter plans. Section 9 also describes the
procedures for requesting determination letters on M&P and volume
submitter plans for adopting employers who need to obtain a determination
letter in order to have reliance or who otherwise wish to obtain a
determination letter, for example to expand the scope of reliance.


STANDARDIZED M&P PLANS

.02 An employer adopting a standardized or paired M&P plan may rely on
that plan's opinion letter, except as provided in section 8.02(1) through
(3) and section 8.04 below, if the sponsor of such plan or plans has a
currently valid favorable opinion letter, the employer has followed the
terms of the plan(s), and the coverage and contributions or benefits under
the plan(s) are not more favorable to highly compensated employees (as
defined in section 414(q)) than for other employees.

(1) Except in the case of a combination of paired plans, an employer
may not rely on an opinion letter for a standardized plan with respect to
the requirements of sections 415 and 416, without obtaining a
determination letter, if the employer maintains at any time, or has
maintained at any time, another plan, including a standardized plan, that
was qualified or determined to be qualified covering some of the same
participants. For this purpose, a plan that has been properly replaced by
the adoption of a standardized plan is not considered another plan. The
plan that has been replaced and the standardized plan must be of the same
type (e.g., both money purchase pension plans) in order for the employer
to be able to rely on the standardized plan with respect to the
requirements of sections 415 and 416 without obtaining a determination
letter. In addition, an employer that adopts a standardized defined
contribution plan will not be considered to have maintained another plan
merely because the employer has maintained another defined contribution
plan(s), provided such other plan(s) has been terminated prior to the
effective date of the standardized plan and no annual additions have been
credited to the account of any participant under such other plan(s) as of
any date within a limitation year of the standardized plan. Likewise, an
employer that adopts a standardized defined contribution plan that is
first effective on or after the effective date of the repeal of section
415(e) will not be considered to have maintained another plan merely
because the employer has maintained a defined benefit plan(s), provided
the defined benefit plan(s) has been terminated prior to the effective
date of the standardized defined contribution plan.

(2) An employer that has adopted a standardized defined benefit plan
may rely on an opinion letter with respect to the requirements of section
401(a)(26) only if the plan satisfies the requirements of section
401(a)(26) with respect to its prior benefit structure or is deemed to
satisfy section 401(a)(26) under the regulations. However, an employer may
request a determination letter if the employer wishes to have reliance as
to whether the plan satisfies section 401(a)(26) with respect to its prior
benefit structure.

(3) An employer that adopts a standardized plan may not rely on an
opinion letter with respect to: (a) whether the timing of any amendment to
the plan (or series of amendments) satisfies the nondiscrimination
requirements of section 1.401(a)(4)-5(a), except with respect to plan
amendments granting past service that meet the safe harbor described in
section 1.401(a)(4)-5(a)(3) and are not part of a pattern of amendments
that significantly discriminates in favor of highly compensated employees;
or (b) whether the plan satisfies the effective availability requirement
of section 1.401(a)(4)-4(c) with respect to any benefit, right, or
feature. An employer that adopts a standardized plan as an amendment to a
plan other than a standardized plan may not rely on an opinion letter with
respect to whether a benefit, right, or feature that is prospectively
eliminated satisfies the current availability requirements of section
1.401(a)(4)-4 of the regulations. Such an employer may request a
determination letter if the employer wishes to have reliance as to whether
the prospectively eliminated benefit, right, or feature satisfies the
current availability requirements.


NONSTANDARDIZED M&P PLANS AND VOLUME SUBMITTER PLANS

.03 An employer adopting a nonstandardized M&P or volume submitter plan
may rely on that plan's opinion or advisory letter as described below if
the employer's plan is identical to an approved M&P or specimen plan with
a currently valid favorable opinion or advisory letter, the employer has
chosen only options permitted under the terms of the approved plan, and
the employer has followed the terms of the plan. These employers can
forego filing Form 5307 and rely on the plan's favorable opinion or
advisory letter with respect to the qualification requirements, except as
provided in section 8.03(1) through (4) and section 8.04 below.

(1) Except as provided in section 8.03(2) and (3), adopting employers
of nonstandardized M&P plans and volume submitter plans may not rely on a
favorable opinion or advisory letter with respect to the requirements of:

(a) sections 401(a)(4), 401(a)(26), 401(l), 410(b) or 414(s); or

(b) if the employer maintains or has ever maintained another plan
covering some of the same participants, sections 415 or 416.


For this purpose, whether an employer maintains or has ever maintained
another plan will be determined using principles consistent with section
8.02(1) above.

(2) Adopting employers of nonstandardized M&P plans and volume
submitter plans may rely on the opinion or advisory letter with respect to
the requirements of sections 410(b) and 401(a)(26) (other than the section
401(a)(26) requirements that apply to a prior benefit structure) if 100
percent of all nonexcludable employees benefit under the plan.

(3) Nonstandardized M&P plans must give adopting employers the option
to elect a safe harbor allocation or benefit formula and a safe harbor
compensation definition. Adopting employers of nonstandardized M&P plans
that elect a safe harbor allocation or benefit formula and a safe harbor
compensation definition may rely on an opinion letter with respect to the
nondiscriminatory amounts requirement under section 401(a)(4). Adopting
employers of nonstandardized M&P plans that are section 401(k) and/or
section 401(m) plans may rely on an opinion letter with respect to whether
the form of the plan satisfies the actual deferral percentage test of
section 401(k)(3) or the actual contribution percentage test of section
401(m)(2) if the employer elects to use a safe harbor definition of
compensation in the test. Adopting employers of nonstandardized M&P plans
described in section 401(k)(11) and/or section 401(m)(12) may rely on an
opinion letter with respect to whether the form of the plan satisfies
these requirements unless the plan provides for the safe harbor
contribution to be made under another plan.

(4) Adopting employers of nonstandardized safe harbor M&P plans (which
require adopting employers to elect a safe harbor allocation or benefit
formula) are entitled to the same reliance as adopting employers of
nonstandardized plans except that they have automatic reliance with
respect to the nondiscriminatory amounts requirement if they elect a safe
harbor definition of compensation.


OTHER LIMITATIONS AND CONDITIONS ON RELIANCE

.04 The following conditions and limitations apply with respect to
standardized and nonstandardized M&P plans as well as volume submitter
plans.

(1) An adopting employer of an M&P or volume submitter plan can rely on
a favorable opinion or advisory letter only if the letter has taken into
account the requirements of GUST and the plan has been amended to the
extent necessary to comply with the requirements of section 314(e) of CRA,
relating to changes to the definition of compensation under sections
414(s) and 415(c)(3). In addition, if the opinion or advisory letter is a
"GUST I" letter (as defined in Rev. Proc. 2000-27, 2000-26 I.R.B. 1272),
the plan must have been amended to the extent necessary to comply with the
requirements of GUST that are effective after 1998.

(2) An adopting employer can rely on a favorable opinion or advisory
letter for a plan that amends or restates a plan of the employer only if
the plan that is being amended or restated satisfies the qualification
requirements as in effect prior to GUST and the operational compliance
requirements of GUST, and the GUST amendments are retroactively effective
to the extent required.

(3) An adopting employer cannot rely on an opinion or advisory letter
for a plan if the repealed family aggregation rules continued to apply
under the plan after 1996 or if the repealed section 415(e) limits
continued to apply under the plan after 1999. The continued application of
these rules and limits in years following their repeal could cause a plan
to fail to satisfy one or more requirements of section 401(a).

(4) An adopting employer cannot rely on an advisory letter issued after
the date the employer adopts the GUST-amended plan.

(5) An adopting employer can rely on an opinion or advisory letter only
if the employer has not added any terms to the approved M&P or volume
submitter plan document and has not modified or deleted any terms of the
document other than choosing options permitted under the document or, in
the case of an M&P plan, amending the document as permitted under sections
5.07 and 5.11 of Rev. Proc. 2000-20. Thus, for example, in the case of a
volume submitter plan, the employer's plan must be identical to the
approved specimen plan except as the result of the employer's selection
among options that are permitted under the terms of the approved specimen
plan.

(6) An adopting employer cannot rely on an opinion or advisory letter
if the adopting employer has modified the terms of the plan's approved
trust in a manner that would cause the plan to fail to be qualified.


RELIANCE EQUIVALENT TO DETERMINATION LETTER

.05 If an employer can rely on a favorable opinion or advisory letter
pursuant to this section, the opinion or advisory letter shall be
equivalent to a favorable determination letter. For example, the favorable
opinion or advisory letter shall be treated as a favorable determination
letter for purposes of section 21 of this revenue procedure, regarding the
effect of a determination letter, and section 5.01(4) of Rev. Proc.
2001-17, 2001-7 I.R.B. 589, regarding the definition of "favorable letter"
for purposes of the Employee Plans Compliance Resolution System.


SECTION 9. ADVISORY LETTER AND DETERMINATION LETTER FILING PROCEDURES FOR
M&P AND VOLUME SUBMITTER PLANS

SCOPE

.01 This section contains procedures for requesting advisory letters
and determination letters for volume submitter plans and determination
letters for M&P plans.


DESCRIPTION OF VOLUME SUBMITTER PROGRAM

.02 Under the volume submitter program, a practitioner who qualifies
may request the Service to issue an advisory letter regarding a volume
submitter specimen plan. A specimen plan is a sample plan of a
practitioner (rather than the actual plan of an employer) that contains
provisions that are identical or substantially similar to the provisions
in plans that such practitioner's clients have adopted or are expected to
adopt. Once the Service has approved the specimen plan, employers who
adopt the same plan and meet the conditions described in section 8 of this
revenue procedure will be able to rely on the advisory letter to the
extent provided in section 8. In addition, the practitioner will be able
to file determination letter requests on behalf of employers adopting
substantially similar plans who need a determination letter to have
reliance or who otherwise desire a determination letter.


DEFINITION OF VOLUME SUBMITTER PLAN

.03 A volume submitter plan is a profit-sharing plan (without a section
401(k) arrangement), a profit-sharing plan (with a section 401(k)
arrangement), a money purchase pension plan, or a defined benefit plan
that is submitted under the procedures described in this section 9 for
filing requests for volume submitter advisory letters (with respect to the
specimen plan) and requests for determination letters (with respect to an
employer's adoption of a plan that is substantially similar to an approved
specimen plan). The Service will not accept volume submitter requests with
respect to ESOPs or other stock bonus plans or cash balance or similar
defined benefit plans.


INCORPORATION BY REFERENCE

.04 Incorporation by reference in a volume submitter plan is subject to
the limits described in sections 5.18 and 8.03 of Rev. Proc. 2000-20.


USER FEES

.05 Rev. Proc. 2002-8 provides reduced user fees for requests under the
volume submitter program if certain requirements are satisfied. For
adopting employers to be entitled to file a request for a determination
letter with the lower fees, the volume submitter practitioner must certify
at the time of filing a request for an advisory letter for the specimen
plan that at least 30 employers are expected to adopt plans that are
substantially similar in form to the specimen plan. Also, the volume
submitter practitioner must be a representative of the employer when the
employer's determination letter application is filed. Although the volume
submitter is not required to submit a list of adopting employers, the
Service reserves the right to request such a list. Reduced user fees also
apply to advisory letter applications for volume submitter specimen plans
that are identical to volume submitter lead specimen plans. See section
17.02 of Rev. Proc. 2000-20.


ADVISORY LETTER FOR SPECIMEN PLAN

.06 With respect to advisory letters for volume submitter specimen
plans:

(1) A request for approval of a volume submitter specimen plan must be
sent to the volume submitter coordinator for EP Determinations at the
following address:

Internal Revenue Service
P.O. Box 2508
Cincinnati, OH 45201
Attn: VSC Coordinator
Room 5106


A request shipped by Express Mail or a delivery service should be sent
to:

Internal Revenue Service
550 Main Street
Cincinnati, OH 45202
Attn: VSC Coordinator
Room 5106


(2) The request for approval must include the following:

(a) A copy of the specimen plan and any related specimen trust
instrument;

(b) A cover letter requesting approval that includes the certification
described in section 9.05 above and indicates the type of plan for which
approval is being requested;

(c) The required user fee submitted with Form 8717, User Fee for
Employee Plan Determination Letter Request; and

(d) An index/table of contents listing the location of all variable
sections.


(3) For procedures regarding volume submitter lead specimen plans, see
section 17.02 of Rev. Proc. 2000-20.


REQUESTS FOR INFORMATION

.07 The Service may, at its discretion, require any additional
information it considers necessary to the issuance of a favorable advisory
letter. If a letter requesting changes to the specimen plan is sent to the
volume submitter practitioner or authorized representative, the changes
must be received no later than 30 days from the date of the letter. If the
changes are not received within 30 days, the advisory letter application
may be considered withdrawn. An extension of the 30-day time limit will
only be granted for reasonable cause.


DETERMINATION LETTER FOR ADOPTION OF VOLUME SUBMITTER PLAN

.08 With respect to determination letters for volume submitter plans:

(1) A request for a determination letter for an employer's adoption of
an approved volume submitter plan must be sent to the address provided in
section 6.18.

(2) The request for a determination letter must include the following:

(a) Form 5307, Application for Determination for Adopters of Master or
Prototype or Volume Submitter Plans (Schedule Q is optional);

(b) Written authorization allowing the volume submitter practitioner to
act as a representative of the employer with respect to the request for a
determination letter;

(c) A copy of the advisory letter for the practitioner's volume
submitter specimen plan;

(d) A copy of the plan and trust instrument and a written
representation made by the volume submitter practitioner which:

(i) states whether the plan and trust instrument are word-for-word
identical to the approved specimen plan;

(ii) if the plan and trust are not word-for-word identical to the
approved specimen plan, explains how the plan and trust instrument differ
from the approved specimen plan, describing the location, nature and
effect of each deviation from the language of the approved specimen plan;
and

(iii) if the latest advisory letter for the approved specimen plan does
not consider all the changes made by GUST and the determination letter
application is for a complete GUST letter, states that the plan satisfies
all requirements of GUST, including those first effective in plan years
beginning after December 31, 1998, and identifies those deviations from
the language of the approved specimen plan that are intended to satisfy
specific GUST requirements;


(e) A copy of the plan's latest favorable determination letter, if
applicable; and

(f) Any other information or material that may be required by the
Service.


(3) Deviations from the language of the approved specimen plan will be
evaluated based on the extent and complexities of the changes. If the
changes are determined not to be compatible with the volume submitter
program, the Service may require the applicant to file Form 5300 and pay
the higher user fee.

(4) An employer will not be treated as having adopted a volume
submitter plan if the employer has signed or otherwise adopted the plan
prior to the date on the volume submitter specimen plan's advisory letter.
In this case, the determination letter application for the employer's plan
may not be filed on Form 5307 and will not be eligible for a reduced user
fee. A determination letter application for a volume submitter plan must
be based on the approved volume submitter specimen plan with any
applicable modifications.


DETERMINATION LETTER FOR ADOPTION OF M&P PLAN

.09 Form 5307 must be filed to request a determination letter for the
adoption of an M&P plan. Schedule Q may be filed as an attachment to Form
5307.


REQUIRED INFORMATION

.10 The determination letter request must include the following:

(1) An adoption agreement showing which elections the employer is
making with respect to the elective provisions contained in the plan;

(2) A copy of the plan's most recent opinion letter; and

(3) In the case of a determination letter request for an M&P plan that
uses a separate trust or custodial account, a copy of the employer's trust
or custodial account document.


AMENDED PLAN IS TREATED AS AN INDIVIDUALLY-DESIGNED PLAN

.11 An employer that amends any provision of an M&P plan or its
adoption agreement (other than to choose among the options offered by the
sponsor if the plan permits or contemplates such options), or an employer
that chooses to discontinue participation in such a plan as amended by its
sponsor and does not substitute another approved plan referred to in this
section is considered to have adopted an individually-designed plan. The
requirements stated in this revenue procedure relating to the issuance of
determination letters for individually-designed plans will then apply to
such plan.


REQUESTS MADE PRIOR TO THE ISSUANCE OF OPINION LETTER

.12 An application submitted by an employer with respect to an M&P plan
will be treated as an application for an individually-designed plan if it
is submitted prior to the time the M&P plan is approved.


SECTION 10. MULTIPLE EMPLOYER PLANS

SCOPE

.01 This section contains procedures for applications filed with
respect to plans described in section 413(c).


OPTION TO FILE FOR THE PLAN ONLY OR FOR BOTH THE PLAN AND EMPLOYERS
MAINTAINING THE PLAN

.02 A determination letter applicant for a multiple employer plan can
request either (1) a letter for the plan or (2) a letter for the plan and
a letter for each employer maintaining the plan with respect to whom a
separate Form 5300 is filed.

(1) An applicant requesting a letter for the plan submits one Form 5300
application for the plan, filed on behalf of one employer, omitting the
optional minimum coverage questions and Schedule Q and either including or
omitting the design-based safe harbor questions. The user fee for a single
employer plan will apply. An employer maintaining a multiple employer plan
can rely on a favorable determination letter issued for the plan without
having to request its own determination letter except with respect to the
requirements of sections 401(a)(4), 401(a)(26), 401(l), 410(b) and 414(s),
and, if the employer maintains or has ever maintained another plan,
sections 415 and 416.

(2) An applicant requesting a letter for the plan and an employer must
submit the filing required in (1) above and a separate Form 5300
application, completed through line 8, for each employer requesting a
separate letter. Each employer may elect to respond to the Form 5300
questions regarding minimum coverage and design-based safe harbors and to
file Schedule Q to request a determination on the average benefit test,
the general test or any other nondiscrimination requirement addressed by
the Schedule Q. The user fee for the application will be determined under
the user fee schedules for multiple employer plans in section 6.06 of Rev.
Proc. 2002-8, treating the entire application as a general test or average
benefit test application if any employer requests a determination on
either of these tests.

(3) Rules similar to the rules in section 8 of this revenue procedure
above also apply in the case of an employer maintaining a multiple
employer plan.



WHERE TO FILE

.03 The complete application, including all Forms 5300 (and, if
applicable, adoption agreements) for employers maintaining the plan who
request separate letters must to be filed as one package submission with
EP Determinations. The application is to be sent to the address in section
6.18


DETERMINATION LETTER SENT TO EACH EMPLOYER WHO FILES FORM 5300

.04 The Service will mail a determination letter to each employer
maintaining the plan for whom a separate Form 5300 has been filed.


ADDITION OF EMPLOYERS

.05 An employer may continue to rely on a favorable determination
letter after another employer commences participation in the plan,
regardless of whether the first employer's reliance is based on its own
letter or the letter issued for the plan and regardless of whether an
application for a determination letter for the new employer is filed. An
application for a determination letter that takes into account the
addition of such other employer should include a completed Form 5300 for
the plan in the name of the controlling member on the Form 5300 filed
pursuant to section 10.02 above, and a supplemental Form 5300 and optional
Schedule Q (and, if applicable, adoption agreement) for each new employer
who desires a separate determination letter. The Service will send the the
determination letter only to the applicant and the new employers.


SECTION 11. MINOR AMENDMENT OF PREVIOUSLY APPROVED PLAN

SCOPE

.01 This section contains procedures for requesting determination
letters on the effect of a minor plan amendment.


FORM 6406

.02 Form 6406, Short Form Application for Determination for Minor
Amendment of Employee Benefit Plan, may be filed to request a
determination letter on a minor plan amendment. This form may be used for
minor amendments of individually-designed plans (including volume
submitter plans, multiemployer plans and multiple employer plans) or
permitted changes to adoption agreement elections in master or prototype
plans, provided the changes constitute minor amendments. The Service may
also designate other specific amendments which may be submitted using Form
6406.


ADDITIONAL INFORMATION

.03 All applications must be accompanied by a copy of the new
amendments, a statement as to how the amendments affect or change the plan
or any other plan maintained by the employer, and a copy of the latest
determination letter. In the case of a master or prototype or volume
submitter plan, a copy of the opinion or advisory letter should also be
included. A copy of the plan or trust instrument should not be filed with
the Form 6406.


MINOR AMENDMENT PROCEDURES MAY NOT BE USED FOR COMPLEX AMENDMENTS OR
GUST LETTER

.04 Since determination letters issued on minor amendments express an
opinion only as to whether the amendments, in and of themselves, affect
the qualification of employee plans under section 401 or 403(a), the minor
amendment procedures cannot be used for complex amendments that may affect
other portions of the plan so as to cause plan disqualification. Thus, the
minor amendment procedures may not be used for an amendment to add a
section 401(k) or an ESOP provision to a plan, or to restate a plan. The
minor amendment procedures also may not be used to obtain a determination
letter on plan amendments involving plan mergers or consolidations,
transfers of assets or liabilities, or plan terminations (including
partial terminations). In addition, the minor amendment procedures may not
be used for an amendment that involves a significant change to plan
benefits or coverage. Except as provided in section 3.05 of Rev. Proc.
2000-27, the minor amendment procedures may not be used to obtain a GUST
determination letter.


EP DETERMINATIONS HAS DISCRETION TO DETERMINE WHETHER USE OF MINOR
AMENDMENT PROCEDURES IS APPROPRIATE

.05 EP Determinations has discretion to determine whether a plan
amendment may be submitted as a minor plan amendment and may request
additional information, including the filing of a Form 5300 series
application if it determines that the application and the attachments
filed under the minor amendment procedures do not contain sufficient
information, or that the Form 6406 is inappropriate.


SECTION 12. TERMINATION OR DISCONTINUANCE OF CONTRIBUTIONS; NOTICE OF
MERGERS, CONSOLIDATIONS, ETC.

SCOPE

.01 This section contains procedures for requesting determination
letters involving plan termination or discontinuance of contributions.
This section also contains procedures regarding required notice of merger,
consolidation, or transfer of assets or liabilities.


FORMS

.02 Required Forms

(1) Form 5310, Application for Determination for Terminating Plan, is
filed by plans other than multiemployer plans covered by the insurance
program of the Pension Benefit Guaranty Corporation (PBGC).

(2) Form 5300, Application for Determination of Employee Benefit Plan,
is filed in the case of a multiemployer plan covered by PBGC insurance.

(3) Schedule Q, Elective Determination Requests, may be filed as an
attachment to Form 5310 or Form 5300.

(4) Form 6088, Distributable Benefits from Employee Pension Benefit
Plans, is also required of a sponsor or plan administrator of a defined
benefit plan or an underfunded defined contribution plan who files only an
application for a determination letter regarding plan termination. For
collectively bargained plans, a Form 6088 is required only if the plan
benefits employees who are not collectively bargained employees within the
meaning of section 1.410(b)-6(d). A separate Form 6088 is required for
each employer employing such employees.

(5) Form 5310-A, Notice of Plan Merger or Consolidation, Spinoff, or
Transfer of Plan Assets or Liabilities-Notice of Qualified Separate Lines
of Business, if required, generally must be filed not later than 30 days
before merger, consolidation or transfer of assets and liabilities. The
filing of Form 5310-A will not result in the issuance of a determination
letter.


SUPPLEMENTAL INFORMATION

.03 The application for a determination letter involving plan
termination must also include any supplemental information or schedules
required by the forms or form instructions. For example, the application
must include copies of all records of actions taken to terminate the plan
(such as a board of director's resolution) and a schedule providing
certain information regarding employees who separated from vesting service
with less than 100% vesting.


REQUIRED DEMONSTRATION OF NONDISCRIMINATION REQUIREMENTS

.04 An applicant requesting a determination letter upon termination may
not decline to elect that the plan be reviewed for the minimum coverage
requirements or the nondiscrimination in amount requirement, as otherwise
permitted, unless the following conditions are satisfied:

(1) With respect to the coverage requirements, in the year of
termination the plan must use the average benefit test and the plan must
have received a prior favorable determination letter that stated that the
plan satisfied the requirements of the test;

(2) With respect to the nondiscrimination in amount requirement, in the
year of termination the plan must use either a nondesign-based safe harbor
or the general test for nondiscrimination in amount and the plan must have
received a prior favorable determination letter that stated that the plan
satisfied the requirements of either a nondesign-based safe harbor or the
general test;

(3) The favorable determination letter was issued during the
immediately preceding three plan years; and

(4) There has been no material change in the facts (including benefits
provided under the plan and employee demographics) or law upon which the
determination was based.


COMPLIANCE WITH TITLE IV OF ERISA

.05 In the case of plans subject to Title IV of ERISA, a favorable
determination letter issued in connection with a plan's termination is
conditioned on approval that the termination is a valid termination under
Title IV of ERISA. Notification by PBGC that a plan may not be terminated
will be treated as a material change of fact.


TERMINATION PRIOR TO TIME FOR AMENDING FOR CHANGE IN LAW

.06 A plan that terminates after the effective date of a change in law,
but prior to the date that amendments are otherwise required, must be
amended to comply with the applicable provisions of law from the date on
which such provisions become effective with respect to the plan. Because
such a terminated plan would no longer be in existence by the required
amendment date and therefore could not be amended on that date, such plan
must be amended in connection with the plan termination to comply with
those provisions of law that become effective with respect to the plan on
or before the date of plan termination. (Such amendments include any
amendments made after the date of plan termination that were required in
order to obtain a favorable determination letter.) In addition, annuity
contracts distributed from such terminated plans also must meet all the
applicable provisions of any change in law.


SECTION 13. GROUP TRUSTS

SCOPE

.01 This section provides special procedures for requesting a
determination letter on the qualified status of a group trust under Rev.
Rul. 81-100.


REQUIRED INFORMATION

.02 A request for a determination letter on the status of a group trust
as described in Rev. Rul. 81-100 is made by submitting a written request
demonstrating how the group trust satisfies the five criteria listed in
Rev. Rul. 81-100, together with the trust instrument and related
documents.


SECTION 14. AFFILIATED SERVICE GROUPS; LEASED EMPLOYEES

SCOPE

.01 This section provides procedures for determination letter requests
on affiliated service group status under section 414(m), and the effect of
leased employees on a plan's qualified status.


TYPES OF REQUESTS UNDER SECTION 414(m) AND SECTION 414(n)

.02 In accordance with section 7.01, an employer that is subject to
section 414(m) or (n) may request a determination letter under the
following circumstances: (1) with respect to the initial qualification of
its plan, (2) on a plan amendment, and (3) in certain circumstances, even
though the plan has not been amended (for example, where there has been a
change in membership in the affiliated service group or where the employer
did not previously have reliance).


EMPLOYER MUST REQUEST THE DETERMINATION UNDER SECTION 414(m) OR SECTION
414(n)

.03 Generally, a determination letter will cover section 414(m) or
section 414(n) only if the employer requests such determination, and
submits with the determination letter application the information
specified in section 14.09 or section 14.10 below.


FORMS

.04 Form 5300 (with Schedule Q optional) is submitted for a request on
affiliated service group status or leased employee status. Form 5307
cannot be used for this purpose.


EMPLOYER IS RESPONSIBLE FOR DETERMINING STATUS UNDER SECTION 414(m) AND
SECTION 414(n)

.05 An employer is responsible for determining at any particular time
whether it is a member of an affiliated service group and, if so, whether
its plan(s) continues to meet the requirements of section 401(a) after the
effective date of section 414(m), including section 414(m)(5). An employer
or plan administrator is also responsible for taking action relative to
the employer's qualified plan if that employer becomes, or ceases to be, a
member of an affiliated service group. An employer that is the recipient
of services of leased employees within the meaning of section 414(n) is
also responsible for determining at any particular time whether a leased
employee is deemed to be an employee of the recipient for qualified plan
purposes.


OMISSION OF MATERIAL FACT

.06 Failure to properly indicate that there is or may be an affiliated
service group and to provide the information specified in section 14.09 of
this revenue procedure, or failure to properly indicate that an employer
is utilizing the services of leased employees and to provide the
information specified in section 14.10, is an omission of a material fact.
The failure of the employer to follow the procedures in this section will
result in the employer being unable to rely on any favorable determination
letter concerning the effect of section 414(m) or section 414(n) on the
qualified status of the plan.


SERVICE WILL INDICATE WHETHER SECTION 414(m) OR SECTION 414(n) WAS
CONSIDERED

.07 If the Service considers whether the plan of an employer satisfies
the requirements of section 414(m) or section 414(n), the determination
letter issued to the employer will state that questions arising under
section 414(m) or section 414(n) have been considered, and that the plan
satisfies qualification requirements relating to that section. Absent such
a statement pertaining to section 414(m) or section 414(n), a
determination letter does not apply to any qualification issue arising by
reason of such provisions.


M&P PLANS

.08 An employer that has adopted an M&P plan (including a standardized
plan) and wants a determination as to the effect of section 414(m) or
section 414(n) on the qualified status of its plan must attach the
information required by section 14.09 or section 14.10 of this revenue
procedure to Form 5300 and submit the information, Form 5300, and any
other materials necessary to make a determination.


REQUIRED INFORMATION FOR SECTION 414(m) DETERMINATION

.09 A determination letter issued with respect to a plan's
qualification under section 401(a), 403(a), or 4975(e)(7) will be a
determination as to the effect of section 414(m) upon the plan's qualified
status only if the application includes:

(1) A description of the nature of the business of the employer,
specifically whether it is a service organization or an organization whose
principal business is the performance of management functions for another
organization, including the reasons therefor;

(2) The identification of other members (or possible members) of the
affiliated service group;

(3) A description of the business of each member (or possible member)
of the affiliated service group, describing the type of organization
(corporation, partnership, etc.) and indicating whether the member is a
service organization or an organization whose principal business is the
performance of management functions for the other group member(s);

(4) The ownership interests between the employer and the members (or
possible members) of the affiliated service group (including ownership
interests as described in section 414(m)(2)(B)(ii) or section
414(m)(6)(B));

(5) A description of services performed for the employer by the members
(or possible members) of the affiliated service group, or vice versa
(including the percentage of each member's (or possible member's) gross
receipts and service receipts provided by such services, if available, and
data as to whether such services are a significant portion of the member's
business) and whether, as of December 13, 1980, it was not unusual for the
services to be performed by employees of organizations in that service
field in the United States;

(6) A description of how the employer and the members (or possible
members) of the affiliated service group associate in performing services
for other parties;

(7) In the case of a management organization under section 414(m)(5):

(a) A description of the management functions, if any, performed by the
employer for the member(s) (or possible member(s)) of the affiliated
service group, or received by the employer from any other members (or
possible members) of the group (including data explaining whether the
management functions are performed on a regular and continuous basis) and
whether or not it is unusual for such management functions to be performed
by employees of organizations in the employer's business field in the
United States;

(b) If management functions are performed by the employer for the
member (or possible members) of the affiliated service group, a
description of what part of the employer's business constitutes the
performance of management functions for the member (or possible member) of
the group (including the percentage of gross receipts derived from
management activities as compared to the gross receipts from other
activities);


(8) A brief description of any other plan(s) maintained by the members
(or possible members) of the affiliated service group, if such other
plan(s) is designated as a unit for qualification purposes with the plan
for which a determination letter has been requested;

(9) A description of how the plan(s) satisfies the coverage
requirements of section 410(b) if the members (or possible members) of the
affiliated service group are considered part of an affiliated service
group with the employer;

(10) A copy of any ruling issued by the headquarters office on whether
the employer is an affiliated service group; a copy of any prior
determination letter that considered the effect of section 414(m) on the
qualified status of the employer's plan; and, if known, a copy of any such
ruling or determination letter issued to any other member (or possible
member) of the same affiliated service group, accompanied by a statement
as to whether the facts upon which the ruling or determination letter was
based have changed.


REQUIRED INFORMATION FOR SECTION 414(n) DETERMINATION

.10 Unless the plan provides that all leased employees within the
meaning of section 414(n)(2) are treated as common law employees for all
purposes under the plan, a determination letter issued with respect to the
plan's qualification under section 401(a), 403(a), or 4975(e)(7) will be a
determination as to the effect of section 414(n) upon the plan's qualified
status only if the application includes:

(1) A description of the nature of the business of the recipient
organization;

(2) A copy of the relevant leasing agreement(s);

(3) A description of the function of all leased employees within the
trade or business of the recipient organization (including data as to
whether all leased employees are performing services on a substantially
full-time basis);

(4) A description of facts and circumstances relevant to a
determination of whether such leased employees' services are performed
under primary direction or control by the recipient organization
(including whether the leased employees are required to comply with
instructions of the recipient about when, where, and how to perform the
services, whether the services must be performed by particular persons,
whether the leased employees are subject to the supervision of the
recipient, and whether the leased employees must perform services in the
order or sequence set by the recipient); and

(5) If the recipient organization is relying on any qualified plan(s)
maintained by the employee leasing organization for purposes of
qualification of the recipient organization's plan, a description of such
plan(s) (including a description of the contributions or benefits provided
for all leased employees which are attributable to services performed for
the recipient organization, plan eligibility, and vesting).


SECTION 15. WAIVER OF MINIMUM FUNDING

SCOPE

.01 This section provides procedures with respect to defined
contribution plans for requesting a waiver of the minimum funding standard
account and requesting a determination letter on any plan amendment
required for the waiver.


APPLICABILITY OF REV. PROC. 94-41

.02 The procedures of Rev. Proc. 94-41, 1994-1 C.B. 711, apply to the
request for a waiver of the minimum funding requirement.


WAIVER AND DETERMINATION LETTER REQUEST SUBMITTED TO EP TECHNICAL

.03 Under this section, both the request for a waiver ruling and the
request for a determination letter on the effect of any amendment
necessary to satisfy section 3 of Rev. Rul. 78-223, 1978-1 C.B. 125, must
be submitted by the taxpayer to EP Technical where it will be treated as a
mandatory request for technical advice. The request that is submitted to
EP Technical must include the following:

(1) All the procedural requirements described in section 3 of Rev.
Proc. 94-41 must be satisfied;

(2) The submission must include a completed Form 5300 and all necessary
documents, plan amendments, and information required by the Form 5300 and
by this revenue procedure for approval of the plan amendments; and

(3) The request and the applicable user fee (required by Rev. Proc.
2002-8) for both the waiver request and the determination letter request
should be sent to:

Internal Revenue Service
Tax Exempt and Government Entities Division
Attention: T:EP:RA
P.O. Box 27063
McPherson Station
Washington, DC 20038


Additional information sent after the initial request should be sent
to:

Manager, Actuarial
T:EP:RA:T:A
Internal Revenue Service
1111 Constitution Ave., NW.
Washington, DC 20224


HANDLING OF THE REQUEST

.04 The waiver request will be handled by EP Technical as follows:

(1) The waiver request and supporting documents will be forwarded to
Actuarial, T:EP:RA:T:A, which will treat the request as a technical advice
on the qualification issue with respect to the plan provisions necessary
to satisfy section 3 of Rev. Rul. 78-223.

(2) EP Determinations will be notified of the request. In order not to
delay the processing of the request, all materials relating to the
determination letter request will be forwarded by EP Technical to EP
Determinations for consideration while the technical advice request is
completed.

(3) EP Technical will consider both the application for a funding
waiver and the proposed plan amendment. If a waiver is to be granted and
if EP Technical believes that qualification of the plan is not adversely
affected by the plan amendment, the mandatory technical advice memorandum
will be issued to EP Determinations. EP Determinations must decide within
10 working days from the date of the technical advice memorandum either to
furnish the applicant with the technical advice memorandum and with a
favorable advance determination letter, or to ask for reconsideration of
the technical advice memorandum. This request must be in writing. An
initial written notice of an intent to make this request may be submitted
within 10 working days of the date of the technical advice memorandum and
followed by a written request within 30 working days from the date of such
written notice. If EP Determinations does not ask for reconsideration of
the technical advice memorandum within 10 working days, Actuarial will
issue the waiver ruling. This ruling will not contain the caveat described
in section 3.02 of Rev. Proc. 94-41.


INTERESTED PARTY NOTICE AND COMMENT

.05 The notice and comment requirements for interested parties provided
in sections 17 and 18 of this revenue procedure must be satisfied.
Comments are to be forwarded to EP Determinations. With respect to the
waiver request, the notice requirements applicable to waiver requests
found in Rev. Proc. 94-41 must be satisfied.


WHEN WAIVER REQUEST SHOULD BE SUBMITTED

.06 In the case of a plan other than a multiemployer plan, no waiver
may be granted under section 412(d) with respect to any plan for any plan
year unless an application therefor is submitted to the Service not later
than the 15th day of the third month beginning after the close of such
plan year. The Service may not extend this deadline. A request for a
waiver with respect to a multiemployer plan generally must be submitted no
later than the close of the plan year following the plan year for which
the waiver is requested.

In seeking a waiver with respect to a plan year which has not yet
ended, the applicant may have difficulty in furnishing sufficient current
evidence in support of the request. For this reason it is generally
advisable that such advance request be submitted no earlier than 180 days
prior to the end of the plan year for which the waiver is requested.



SECTION 16. SECTION 401(h) AND SECTION 420 DETERMINATION LETTERS

SCOPE

.01 This section provides procedures for requesting determination
letters (i) with respect to whether the requirements of section 401(h) are
satisfied in a plan with retiree medical benefit features and (ii) on plan
language that permits, pursuant to section 420, the transfer of assets in
a defined benefit plan to a health benefit account described in section
401(h).


REQUIRED INFORMATION FOR SECTION 401(h) DETERMINATION

.02 EP Determinations will issue a determination letter that considers
whether the requirements of section 401(h) are satisfied in a plan with
retiree medical benefit features only if the plan sponsor's application
includes, in addition to the application forms and any other material
required by this revenue procedure, a cover letter that requests
consideration of section 401(h). The cover letter must specifically state
that consideration is being requested with regard to section 401(h) in
addition to other matters under section 401(a) and must specifically state
the location of plan provisions that satisfy the requirements of section
401(h). Part I of the checklist in the Appendix of this revenue procedure
may be used to identify the location of relevant plan provisions. Form
6406 may not be used to request a determination letter that considers
section 401(h).


REQUIRED INFORMATION FOR SECTION 420 DETERMINATION

.03 EP Determinations will consider the qualified status of plan
language designed to comply with section 420 only if the plan sponsor
requests such consideration in a cover letter. The cover letter must
specifically state (i) whether consideration is being requested only with
regard to section 420, or (ii) whether consideration is being requested
with regard to section 420 in addition to other matters under section
401(a). (If consideration of other matters under section 401(a) is being
requested, the application forms and other material required by this
revenue procedure must also be submitted. Form 6406 may not be used for
this purpose.) The cover letter must specifically state the location of
plan provisions that satisfy each of the following requirements. Parts I
and II of the checklist in the Appendix of this revenue procedure may be
used to identify the location of relevant plan provisions.

(1) The plan must include a health benefits account as described in
section 401(h).

(2) The plan must provide that transfers shall be limited to transfers
of "excess assets" as defined in section 420(e)(2).

(3) The plan must provide that only one transfer may be made in a
taxable year. However, for purposes of determining whether the rule in the
preceding sentence is met, a plan may provide that a transfer will not be
taken into account if it is a transfer that:

(a) Is made after the close of the taxable year preceding the
employer's first taxable year beginning after December 31, 1990, and
before the earlier of (i) the due date (including extensions) for the
filing of the return of tax for such preceding year, or (ii) the date such
return is filed; and

(b) Does not exceed the expenditures of the employer for qualified
current retiree health liabilities for such preceding taxable year.


(4) The plan must provide that the amount transferred shall not exceed
the amount which is reasonably estimated to be the amount the employer
will pay out (whether directly or through reimbursement) of the health
benefit account during the taxable year of the transfer for "qualified
current retiree health liabilities", as defined in section 420(e)(1).

(5) The plan must provide that no transfer will be made after December
31, 2005.

(6) The plan must provide that any assets transferred, and any income
allocable to such assets, shall be used only to pay qualified current
retiree health liabilities for the taxable year of transfer.

(7) The plan must provide that any amounts transferred to a health
benefits account (and income attributable to such amounts) which are not
used to pay qualified current retiree health liabilities shall be
transferred back to the defined benefit portion of the plan.

(8) The plan must provide that the amounts paid out of a health
benefits account will be treated as paid first out of transferred assets
and income attributable to those assets.

(9) The plan must provide that the accrued pension benefits for
participants and beneficiaries must become nonforfeitable as if the plan
had terminated immediately prior to the transfer (or in the case of a
participant who separated during the 1-year period ending on the date of
transfer immediately before such separation). In the case of a transfer
described in section 420(b)(4) that relates to a prior year, the plan must
provide that the accrued benefit of a participant who separated from
service during the taxable year to which such transfer relates will be
recomputed and treated as nonforfeitable immediately before such
separation.

(10) The plan must provide that a transfer will be permitted only if
each group health plan or arrangement under which health benefits are
provided contains provisions satisfying section 420(c)(3). The plan must
define "applicable employer cost", "cost maintenance period", and "benefit
maintenance period", as applicable, consistent with section 420(c)(3), as
amended by the Tax Relief Extension Act of 1999, Pub. L. 106-170 (TREA
'99). If applicable, the provisions of the plan must also reflect the
transition rule in section 535(c)(2) of TREA '99. The plan may provide
that section 420(c)(3) is satisfied separately with respect to individuals
eligible for benefits under Title XVIII of the Social Security Act at any
time during the taxable year and with respect to individuals not so
eligible.

(11) The plan must provide that transferred assets cannot be used for
key employees (as defined in section 416(i)(1)).


PART II. INTERESTED PARTY NOTICE AND COMMENT

SECTION 17. WHAT RIGHTS TO NOTICE AND COMMENT DO INTERESTED PARTIES HAVE?

RIGHTS OF INTERESTED PARTIES

.01 Persons who qualify as interested parties under section
1.7476-1(b), have the following rights:

(1) To receive notice, in accordance with section 18 below, that an
application for an advance determination will be filed regarding the
qualification of plans described in sections 401, 403(a), 409 and/or
4975(e)(7);

(2) To submit written comments with respect to the qualification of
such plans to the Service;

(3) To request the Department of Labor to submit a comment to the
Service on behalf of the interested parties; and

(4) To submit written comments to the Service on matters with respect
to which the Department of Labor was requested to comment but declined.


COMMENTS BY INTERESTED PARTIES

.02 Comments submitted by interested parties must be received by EP
Determinations by the 45th day after the day on which the application for
determination is received by EP Determinations. (However, see sections
17.03 and 17.04 for filing deadlines where the Department of Labor has
been requested to comment.) Such comments must be in writing, signed by
the interested parties or by an authorized representative of such parties
(as provided in section 9.02(11) of Rev. Proc. 2002-4), addressed to EP
Determinations at the address in section 6.18, and contain the following
information:

(1) The names of the interested parties making the comments;

(2) The name and taxpayer identification number of the applicant for a
determination;

(3) The name of the plan, the plan identification number, and the name
of the plan administrator;

(4) Whether the parties submitting the comment are:

(a) Employees eligible to participate under the plan,

(b) Employees with accrued benefits under the plan, or former employees
with vested benefits under the plan,

(c) Beneficiaries of deceased former employees who are eligible to
receive or are currently receiving benefits under the plan,

(d) Employees not eligible to participate under the plan.


(5) The specific matters raised by the interested parties on the
question of whether the plan meets the requirements for qualification
involving sections 401 and 403(a), and how such matters relate to the
interests of the parties making the comment; and

(6) The address of the interested party submitting the comment (or if a
comment is submitted jointly by more than one party, the name and address
of a designated representative) to which all correspondence, including a
notice of the Service's final determination with respect to qualification,
should be sent. (The address designated for notice by the Service will
also be used by the Department of Labor in communicating with the parties
submitting a request for comment.) The designated representative may be
one of the interested parties submitting the comment or an authorized
representative. If two or more interested parties submit a single comment
and one person is not designated in the comment as the representative for
receipt of correspondence, a notice of determination mailed to any
interested party who submitted the comment shall be notice to all the
interested parties who submitted the comment for purposes of section
7476(b)(5) of the Code.


REQUESTS FOR DOL TO SUBMIT COMMENTS

.03 A request to the Department of Labor to submit to EP Determinations
a comment pursuant to section 3001(b)(2) of ERISA must be made in
accordance with the following procedures.

(1) The request must be received by the Department of Labor by the 25th
day after the day the application for determination is received by EP
Determinations. However, if the parties requesting the Department to
submit a comment wish to preserve the right to comment to EP
Determinations in the event the Department declines to comment, the
request must be received by the Department by the 15th day after the day
the application for determination is received by EP Determinations.

(2) The request to the Department of Labor to submit a comment to EP
Determinations must:

(a) Be in writing;

(b) Be signed as provided in section 17.02 above;

(c) Contain the names of the interested parties requesting the
Department to comment and the address of the interested party or
designated representative to whom all correspondence with respect to the
request should be sent. See also section 17.02(6) above;

(d) Contain the information prescribed in section 17.02(2), (3), (4),
(5) and (6) above;

(e) Indicate that the application was or will be submitted to EP
Determinations at the address in section 6.18;

(f) Contain a statement of the specific matters upon which the
Department's comment is sought, as well as how such matters relate to the
interested parties making the request; and

(g) Be addressed as follows:

Deputy Assistant Secretary
Pension and Welfare Benefits Administration
U.S. Department of Labor,
200 Constitution Avenue, NW.,
Washington, DC 20210
Attention: 3001 Comment Request


RIGHT TO COMMENT IF DOL DECLINES TO COMMENT

.04 If a request described in 17.03 is made and the Department of Labor
notifies the interested parties making the request that it declines to
comment on a matter concerning qualification of the plan which was raised
in the request, the parties submitting the request may still submit a
comment to EP Determinations on such matter. The comment must be received
by the later of the 45th day after the day the application for
determination is received by EP Determinations or the 15th day after the
day on which notification is given by the Department that it declines to
submit a comment on such matter. (See section 17.07 for the date of
notification.) In no event may the comment be received later than the 60th
day after the day the application for determination was received. Such a
comment must comply with the requirements of section 17.02 and include a
statement that the comment is being submitted on matters raised in a
request to the Department upon which the Department declined to comment.


CONFIDENTIALITY OF COMMENTS

.05 For rules regarding the confidentiality of contents of written
comments submitted by interested parties to the Service pursuant to
section 17.02 or 17.04, see section 601.201(o)(5) of the Statement of
Procedural Rules.


AVAILABILITY OF COMMENTS

.06 For rules regarding the availability to the applicant of copies of
all comments on the application submitted pursuant to section 17.01(1),
(2), (3) and (4) of this revenue procedure, see section 601.201(o)(5) of
the Statement of Procedural Rules.


WHEN COMMENTS ARE DEEMED MADE

.07 An application for an advance determination, a comment to EP
Determinations, or a request to the Department of Labor shall be deemed
made when it is received by EP Determinations, or the Department.
Notification by the Department that it declines to comment shall be deemed
given when it is received by the interested party or designated
representative. The notice described in section 18.01 below shall be
deemed given when it is given in person, posted as prescribed in the
regulations under section 7476, or received through the mail or a private
delivery service that has been designated under section 7502(f). In the
case of an application, comment, request, notification, or notice that is
sent by mail or designated private delivery service, the date as of which
it shall be deemed received will be determined under section 7502.
However, if such an application, comment, request, notification, or notice
is not received within a reasonable period from the date determined under
section 7502, the immediately preceding sentence shall not apply.


SECTION 18. WHAT ARE THE GENERAL RULES FOR NOTICE TO INTERESTED PARTIES?

NOTICE TO INTERESTED PARTIES

.01 Notice that an application for an advance determination regarding the
qualification of a plan described in sections 401, 403(a), 409 and
4975(e)(7) is to be made must be given to all interested parties in the
manner set forth in section 1.7476-2(c) and in accordance with the
requirements of this section.


TIME WHEN NOTICE MUST BE GIVEN

.02 When the notice referred to in section 18.01 is given by posting or
in person, such notice must be given not less than 7 days nor more than 21
days prior to the day the application for a determination is made. When
the notice is given by mailing or designated private delivery service, it
should be given not less than 10 days nor more than 24 days prior to the
day the application for a determination is made. If, however, an
application is returned to the applicant for failure to adequately satisfy
the notification requirements with respect to a particular group or class
of interested parties, the applicant need not cause notice to be given to
those groups or classes of interested parties with respect to which the
notice requirement was already satisfied merely because, as a result of
the resubmission of the application, the time limitations of this
subsection would not be met.


CONTENT OF NOTICE

.03 The notice referred to in section 18.01 shall be in writing and
shall contain the following information:

(1) A brief description identifying the class or classes of interested
parties to whom the notice is addressed (e.g., all present employees of
the employer, all present employees eligible to participate);

(2) The name of the plan, the plan identification number, and the name
of the plan administrator;

(3) The name and taxpayer identification number of the applicant for a
determination;

(4) That an application for a determination as to the qualified status
of the plan is to be made to the Service at the address in section 6.18,
and stating whether the application relates to an initial qualification, a
plan amendment, termination, or a partial termination;

(5) A description of the class of employees eligible to participate
under the plan;

(6) Whether or not the Service has issued a previous determination as
to the qualified status of the plan;

(7) A statement that any person to whom the notice is addressed is
entitled to submit, or request the Department of Labor to submit, to EP
Determinations, a comment on the question of whether the plan meets the
requirements of section 401 or 403(a); that two or more such persons may
join in a single comment or request; and that if such persons request the
Department of Labor to submit a comment and the Department of Labor
declines to do so with respect to one or more matters raised in the
request, the persons may still submit a comment to EP Determinations with
respect to the matters on which the Department declines to comment. The
Pension Benefit Guaranty Corporation (PBGC) may also submit comments. In
every instance where there is either a final adverse termination or a
distress termination, the Service formally notifies the PBGC for comments;

(8) The specific dates by which a comment to EP Determinations or a
request to the Department of Labor must be received in order to preserve
the right of comment (see section 17 above);

(9) The number of interested parties needed in order for the Department
of Labor to comment; and

(10) Except to the extent that the additional informational material
required to be made available by sections 18.05 through 18.09 are included
in the notice, a description of a reasonable procedure whereby such
additional informational material will be available to interested parties
(see section 18.04). (Examples of notices setting forth the above
information, in a case in which the additional information required by
sections 18.05 through 18.09 will be made available at places accessible
to the interested parties, are set forth in the Exhibit attached to this
revenue procedure.)


PROCEDURES FOR MAKING INFORMATION AVAILABLE TO INTERESTED PARTIES

.04 The procedure referred to in section 18.03(10), whereby the
additional informational material required by sections 18.05 through 18.09
will (to the extent not included in the notice) be made available to
interested parties, may consist of making such material available for
inspection and copying by interested parties at a place or places
reasonably accessible to such parties, or supplying such material in
person or by mail, or by a combination of the foregoing, provided such
procedure is immediately available to all interested parties, is designed
to supply them with such additional informational material in time for
them to pursue their rights within the time period prescribed, and is
available until the earlier of: 1) the filing of a pleading commencing a
declaratory judgment action under section 7476 with respect to the
qualification of the plan; or 2) the 92nd day after the day the notice of
final determination is mailed to the applicant. Reasonable charges to
interested parties for copying and/or mailing such additional
informational material are permissible.


INFORMATION TO BE AVAILABLE TO INTERESTED PARTIES

.05 Unless provided in the notice, or unless section 18.06 applies,
there shall be made available to interested parties under a procedure
described in section 18.04:

(1) An updated copy of the plan and the related trust agreement (if
any); and

(2) The application for determination.


SPECIAL RULES IF THERE ARE LESS THAN 26 PARTICIPANTS

.06 If there would be less than 26 participants in the plan, as
described in the application (including, as participants, former employees
with vested benefits under the plan, beneficiaries of deceased former
employees currently receiving benefits under the plan, and employees who
would be eligible to participate upon making mandatory employee
contributions, if any), then in lieu of making the materials described in
section 18.05 available to interested parties who are not participants (as
described above), there may be made available to such interested parties a
document containing the following information:

(1) A description of the plan's requirements respecting eligibility for
participation and benefits and the plan's benefit formula;

(2) A description of the provisions providing for nonforfeitable
benefits;

(3) A description of the circumstances which may result in
ineligibility, or denial or loss of benefits;

(4) A description of the source of financing of the plan and the
identity of any organization through which benefits are provided;

(5) A description of any optional forms of benefits described in
section 411(d)(6) which have been reduced or eliminated by plan amendment;
and

(6) Whether the applicant is claiming in the application that the plan
meets the requirements of section 410(b)(1)(A), and, if not, the coverage
schedule required by the application in the case of plans not meeting the
requirements of such section.


However, once an interested party or designated representative receives
a notice of final determination, the applicant must, upon request, make
available to such interested party (whether or not the plan has less than
26 participants) an updated copy of the plan and related trust agreement
(if any) and the application for determination.


INFORMATION DESCRIBED IN SECTION 6104(a)(1)(D) SHOULD NOT BE INCLUDED

.07 Information of the type described in section 6104(a)(1)(D) should
not be included in the application, plan, or related trust agreement
submitted to the Service. Accordingly, such information should not be
included in any of the material required by section 18.05 or 18.06 to be
available to interested parties.


AVAILABILITY OF ADDITIONAL INFORMATION TO INTERESTED PARTIES

.08 Unless provided in the notice, there shall be made available to
interested parties under a procedure described in section 18.04, any
additional document dealing with the application which is submitted by or
for the applicant to the Service, or furnished by the Service to the
applicant; provided, however, if there would be less than 26 participants
in the plan as described in the application (including, as participants,
former employees with vested benefits under the plan, beneficiaries of
deceased former employees currently receiving benefits under the plan, and
employees who would be eligible to participate upon making mandatory
employee contributions, if any), such additional documents need not be
made available to interested parties who are not participants (as
described above) until they, or their designated representative, receive a
notice of final determination. The applicant may also withhold from such
inspection and copying information described in section 6104(a)(1)(C)
and (D) which may be contained in such additional documents.


AVAILABILITY OF NOTICE TO INTERESTED PARTIES

.09 Unless provided in the notice, there shall be made available to all
interested parties under a procedure described in section 18.04 the
material described in sections 17.02 through 17.07 above.


PART III. PROCESSING DETERMINATION LETTER REQUESTS

SECTION 19. HOW DOES THE SERVICE HANDLE DETERMINATION LETTER REQUESTS?

ORAL ADVICE

.01 Oral advice.

(1) The Service does not issue determination letters on oral requests.
However, personnel in EP Determinations ordinarily will discuss with
taxpayers or their representatives inquiries regarding: substantive tax
issues; whether the Service will issue a determination letter on
particular issues; and questions relating to procedural matters about
submitting determination letter requests. Any discussion of substantive
issues will be at the discretion of the Service on a time available basis,
will not be binding on the Service, and cannot be relied upon as a basis
of obtaining retroactive relief under the provisions of section 7805(b). A
taxpayer may seek oral technical assistance from a taxpayer service
representative when preparing a return or report, under established
procedures. Oral advice is advisory only, and the Service is not bound to
recognize it in the examination of the taxpayer's return.

(2) The advice or assistance furnished, whether requested by personal
appearance, telephone, or correspondence will be limited to general
procedures, or will direct the inquirer to source material, such as
pertinent Code provisions, regulations, revenue procedures, and revenue
rulings that may aid the inquirer in resolving the question or problem.


CONFERENCES

.02 EP Determinations may grant a conference upon written request from
a taxpayer or his representative, provided the request shows that a
substantive plan, amendment, etc., has been developed for submission to
the Service, but that special problems or issues are involved, and EP
Determinations concludes that a conference would be warranted in the
interest of facilitating review and determination when the plan, etc., is
formally submitted. See section 6.20 and 6.21 regarding the right to a
status conference on applications pending for at least 270 days.



DETERMINATION LETTER BASED SOLELY ON ADMINISTRATIVE RECORD

.03 Administrative Record

(1) In the case of a request for a determination letter, the
determination of EP Determinations or the appeals office on the
qualification or non-qualification of the retirement plan shall be based
solely upon the facts contained in the administrative record. The
administrative record shall consist of the following:

(a) The request for determination, the retirement plan and any related
trust instruments, and any written modifications or amendments made by the
applicant during the proceedings within the Service;

(b) All other documents submitted to the Service by, or on behalf of,
the applicant with respect to the request for determination;

(c) All written correspondence between the Service and the applicant
with respect to the request for determination and any other documents
issued to the applicant from the Service;

(d) All written comments submitted to the Service pursuant to sections
17.01(2), (3), and (4) above, and all correspondence relating to comments
submitted between the Service and persons (including PBGC and the
Department of Labor) submitting comments pursuant to sections 17.01(2),
(3), and (4) above; and

(e) In any case in which the Service makes an investigation regarding
the facts as represented or alleged by the applicant in the request for
determination or in comments submitted pursuant to sections 17.01(2), (3),
and (4) above, a copy of the official report of such investigation.


(2) The administrative record shall be closed upon the earlier of the
following events:

(a) The date of mailing of a notice of final determination by the
Service with respect to the application for determination; or

(b) The filing of a petition with the United States Tax Court seeking a
declaratory judgment with respect to the retirement plan.


(3) Any oral representation or modification of the facts as represented
or alleged in the application for determination or in a comment filed by
an interested party, which is not reduced to writing shall not become a
part of the administrative record and shall not be taken into account in
the determination of the qualified status of the retirement plan by EP
Determinations or the appeals office.


NOTICE OF FINAL DETERMINATION

.04 In the case of final determination, the notice of final
determination:

(1) Shall be the letter issued by EP Determinations or the appeals
office which states that the applicant's plan satisfies the qualification
requirements of the Code. The favorable determination letter will be sent
by certified or registered mail where either an interested party, the
Department of Labor, or the PBGC has commented on the application for
determination.

(2) Shall be the letter issued, by certified or registered mail, by EP
Determinations or the appeals office subsequent to a letter of proposed
determination, stating that the applicant's plan fails to satisfy the
qualification requirements of the Code.


ISSUANCE OF THE NOTICE OF FINAL DETERMINATION

.05 EP Determinations or the appeals office will send the notice of
final determination to the applicant, to the interested parties who have
previously submitted comments on the application to the Service (or to the
persons designated by them to receive such notice), to the Department of
Labor in the case of a comment submitted by the Department, and to PBGC if
it has filed a comment.


SECTION 20. EXHAUSTION OF ADMINISTRATIVE REMEDIES

IN GENERAL

.01 For purposes of section 7476(b)(3), a petitioner shall be deemed to
have exhausted the administrative remedies available within the Service
upon the completion of the steps described in sections 20.02, 20.03,
20.04, or 20.05 subject, however, to sections 20.06 and 20.07. If
applicants, interested parties, or the PBGC do not complete the applicable
steps described below, they will not have exhausted their respective
available administrative remedies as required by section 7476(b)(3) and
will, thus, be precluded from seeking declaratory judgment under section
7476 except to the extent that section 20.05 or 20.08 applies.


STEPS FOR EXHAUSTING ADMINISTRATIVE REMEDIES

.02 In the case of an applicant, with respect to any matter relating to
the qualification of a plan, the steps referred to in section 20.01 are:

(1) Filing a completed application with EP Determinations pursuant to
this revenue procedure;

(2) Complying with the requirements pertaining to notice to interested
parties as set forth in this revenue procedure and section 1.7476-2 of the
regulations; and,

(3) Appealing to the appropriate appeals office pursuant to paragraph
601.201(o)(6) of the Statement of Procedural Rules, in the event a notice
of proposed adverse determination is issued by EP Determinations.


APPLICANT'S REQUEST FOR SECTION 7805(b) RELIEF

.03 Consideration of relief under section 7805(b) will be included as
one of the applicant's steps in exhausting administrative remedies only if
the applicant requests EP Determinations to seek technical advice from EP
Technical on the applicability of such relief. The applicant's request
must be made in writing according to the procedures for requesting
technical advice (see section 19 of Rev. Proc. 2002-5).


INTERESTED PARTIES

.04 In the case of an interested party or the PBGC, the steps referred
to in section 20.01 are, with respect to any matter relating to the
qualification of the plan, submitting to EP Determinations a comment
raising such matter in accordance with section 17.01(2) above, or
requesting the Department of Labor to submit to EP Determinations a
comment with respect to such matter in accordance with section 17.01(3)
and, if the Department of Labor declines to comment, submitting the
comment in accordance with section 17.01(4) above, so that it may be
considered by the Service through the administrative process.


DEEMED EXHAUSTION OF ADMINISTRATIVE REMEDIES

.05 An applicant, an interested party, or the PBGC shall in no event be
deemed to have exhausted administrative remedies prior to the earlier of:

(1) The completion of those steps applicable to each as set forth in
sections 20.01, 20.02, 20.03 or 20.04, which constitute their
administrative remedies; or,

(2) The expiration of the 270-day period described in section
7476(b)(3), which period shall be extended in a case where there has not
been a completion of all the steps referred to in section 20.02 and the
Service has proceeded with due diligence in processing the application for
determination.


SERVICE MUST ACT ON APPEAL

.06 The step described in section 20.02(3) will not be considered
completed until the Service has had a reasonable time to act upon the
appeal.


SERVICE MUST ACT ON SECTION 7805(b) REQUEST

.07 Where the applicant has requested EP Determinations to seek
technical advice on the applicability of section 7805(b) relief, the
applicant's administrative remedies will not be considered exhausted until
EP Technical has had a reasonable time to act upon the request for
technical advice.


EFFECT OF TECHNICAL ADVICE REQUEST

.08 The step described in section 20.02(3) will not be available or
necessary with respect to any issue on which technical advice has been
obtained from EP Technical.


SECTION 21. WHAT EFFECT WILL AN EMPLOYEE PLAN DETERMINATION LETTER HAVE?

SCOPE OF RELIANCE ON DETERMINATION LETTER

.01 A determination letter issued pursuant to this revenue procedure
contains only the opinion of the Service as to the qualification of the
particular plan involving the provisions of sections 401 and 403(a) and
the status of a related trust, if any, under section 501(a). Such a
determination letter is based on the facts and demonstrations presented to
the Service in connection with the application for the determination
letter and may not be relied upon after a change in material fact or the
effective date of a change in law, except as provided. The Service may
determine, based on the application form, the extent of review of the plan
document. Failure to disclose a material fact or misrepresentation of a
material fact may adversely affect the reliance which would otherwise be
obtained through the issuance by the Service of a favorable determination
letter. Similarly, failure to accurately provide any of the information
called for on any form required by this revenue procedure may result in no
reliance. Applicants are advised to retain copies of all demonstrations
and supporting data submitted with their applications. Failure to do so
may limit the scope of reliance.


EFFECT OF DETERMINATION LETTER ON MINOR PLAN AMENDMENT

.02 Determination letters issued on minor amendments to plans and
trusts under this revenue procedure will merely express an opinion whether
the amendment, in and of itself, affects the existing status of the plan's
qualification and the exempt status of the related trust. In no event
should such a determination letter be construed as an opinion on the
qualification of the plan as a whole and the exempt status of the related
trust as a whole.


SECTIONS 13 AND 14 OF REV. PROC. 2002-4 APPLICABLE

.03 Except as otherwise provided in this section, determination letters
referred to in sections 21.01 and 21.02 are governed, generally, by the
provisions of sections 13 and 14 of Rev. Proc. 2002-4.


EFFECT OF SUBSEQUENT PUBLICATION OF REVENUE RULING, ETC.

.04 The prior qualification of a plan as adopted by an employer will
not be considered to be adversely affected by the publication of a revenue
ruling, a revenue procedure, or an administrative pronouncement within the
meaning of section 1.6661-3(b)(2) of the regulations where:

(1) The plan was the subject of a favorable determination letter and
the request for that letter contained no misstatement or omission of
material facts;

(2) The facts subsequently developed are not materially different from
the facts on which the determination letter was based;

(3) There has been no change in the applicable law; and

(4) The employer that established the plan acted in good faith in
reliance on the determination letter.


However, all such plans must be amended to comply with the published
revenue ruling for subsequent years. Unless specifically stated otherwise
in the revenue ruling or in other published guidance of general
applicability, the conforming amendment to an individually-designed plan
must be adopted before the end of the first plan year that begins after
the revenue ruling, revenue procedure, or administrative pronouncement is
published in the Internal Revenue Bulletin and must be effective, for all
purposes, not later than the first day of the first plan year beginning
after the revenue ruling is published. For the rule as to the conforming
amendment to an M&P plan, see section 12 of Rev. Proc. 2000-20.


DETERMINATION LETTER DOES NOT APPLY TO TAXABILITY ISSUES

.05 While a favorable determination letter may serve as a basis for
determining deductions for employer contributions thereunder, it is not to
be taken as an indication that contributions are necessarily deductible as
made. This latter determination can be made only upon an examination of
the employer's tax return, in accordance with the limitations, and subject
to the conditions of section 404.


SECTION 22. EFFECT ON OTHER REVENUE PROCEDURES

Rev. Proc. 2001-6 is superseded. Rev. Proc. 2000-20 is modified to
provide that an employer that adopts a nonstandardized M&P plan may rely
on a favorable opinion letter for the plan without having to request a
determination letter, to the extent provided in section 8 of this revenue
procedure.


SECTION 23. EFFECTIVE DATE

This revenue procedure is effective January 7, 2002. However, with
regard to determination letter application filing requirements, plan
sponsors may follow the transitional rules in section I.G of Announcement
2001-77, as provided, and for the period specified, in Announcement
2001-122, 2001-51 I.R.B. 604.


SECTION 24. PAPERWORK REDUCTION ACT

The collections of information contained in this revenue procedure have
been reviewed and approved by the Office of Management and Budget in
accordance with the Paperwork Reduction Act (44 U.S.C. 3507) under control
number 1545-1520.

An agency may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless the collection of
information displays a valid control number.

The collections of information in this revenue procedure are in
sections 6.17, 6.19, 6.20, 6.21, 7.04, 9.08, 13, 14, 15, 16, 19.02, and
21.04. This information is required to determine plan qualification. This
information will be used to determine whether a plan is entitled to
favorable tax treatment. The collections of information are mandatory. The
likely respondents are business or other for-profit institutions.

The estimated total annual reporting and/or recordkeeping burden is
163,186 hours.

The estimated annual burden per respondent/recordkeeper varies from 1
hour to 40 hours, depending on individual circumstances, with an estimated
average of 2.02 hours. The estimated number of respondents and/or
recordkeepers is 80,763.

The estimated annual frequency of responses (used for reporting
requirements only) is once every three years.

Books or records relating to a collection of information must be
retained as long as their contents may become material in the
administration of any internal revenue law. Generally tax returns and tax
return information are confidential, as required by 26 U.S.C. 6103.


DRAFTING INFORMATION

The principal author of this revenue procedure is James Flannery of the
Employee Plans, Tax Exempt and Government Entities Division. For further
information regarding this revenue procedure, please contact the Employee
Plans' taxpayer assistance telephone service at 1-877-829-5500 (a
toll-free number), between the hours of 8:00 a.m. and 6:30 p.m. Eastern
Time, Monday through Friday. Mr. Flannery may be reached at 1-202-283-9888
(not a toll-free number).


EXHIBIT: SAMPLE NOTICE TO INTERESTED PARTIES

The Exhibit set forth below, may be used to satisfy the requirements of
section 18 of this revenue procedure.

EXHIBIT: SAMPLE NOTICE TO INTERESTED PARTIES

1. Notice To: ____ [describe class or classes of interested parties]

An application is to be made to the Internal Revenue Service for an
advance determination on the qualification of the following employee
pension benefit plan:

2. ____
(name of plan)

3. ____
(plan number)

4. ____
(name and address of applicant)

5. ____
(applicant EIN)

6. ____
(name and address of plan administrator)

7. The application will be filed on ____ for an advance determination as
to whether the plan meets the qualification requirements of section 401 or
403(a) of the Internal Revenue Code of 1986, with respect to the plan's
____ [initial qualification, amendment, termination, or partial
termination]. The application will be filed with:

EP Determinations
Internal Revenue Service
P.O. Box 192
Covington, KY 41012-0192


8. The employees eligible to participate under the plan are: ____

9. The Internal Revenue Service ____ [has/has not] previously issued a
determination letter with respect to the qualification of this plan.


RIGHTS OF INTERESTED PARTIES

10. You have the right to submit to EP Determinations, at the above
address, either individually or jointly with other interested parties,
your comments as to whether this plan meets the qualification requirements
of the Internal Revenue Code.

You may instead, individually or jointly with other interested parties,
request the Department of Labor to submit, on your behalf, comments to EP
Determinations regarding qualification of the plan. If the Department
declines to comment on all or some of the matters you raise, you may,
individually, or jointly if your request was made to the Department
jointly, submit your comments on these matters directly to EP
Determinations.


REQUESTS FOR COMMENTS BY THE DEPARTMENT OF LABOR

11. The Department of Labor may not comment on behalf of interested
parties unless requested to do so by the lessor of 10 employees or 10
percent of the employees who qualify as interested parties. The number of
persons needed for the Department to comment with respect to this plan is
____. If you request the Department to comment, your request must be in
writing and must specify the matters upon which comments are requested,
and must also include:

(1) the information contained in items 2 through 5 of this Notice; and

(2) the number of persons needed for the Department to comment.


A request to the Department to comment should be addressed as follows:

Deputy Assistant Secretary
Pension and Welfare Benefits Administration
ATTN: 3001 Comment Request
U.S. Department of Labor,
200 Constitution Avenue, NW.
Washington, D.C. 20210


COMMENTS TO THE INTERNAL REVENUE SERVICE

12. Comments submitted by you to EP Determinations must be in writing and
received by him by ____. However, if there are matters that you request
the Department of Labor to comment upon on your behalf, and the Department
declines, you may submit comments on these matters to EP Determinations to
be received by them within 15 days from the time the Department notifies
you that it will not comment on a particular matter, or by ____, whichever
is later, but not after ____. A request to the Department to comment on
your behalf must be received by it by ____ if you wish to preserve your
right to comment on a matter upon which the Department declines to
comment, or by ____ if you wish to waive that right.


ADDITIONAL INFORMATION

13. Detailed instructions regarding the requirements for notification of
interested parties may be found in sections 17 and 18 of Rev. Proc.
2002-6. Additional information concerning this application (including,
where applicable, an updated copy of the plan and related trust; the
application for determination; any additional documents dealing with the
application that have submitted to the Service; and copies of section 17
of Rev. Proc. 2002-6 are available at ____ during the hours of ____ for
inspection and copying. (There is a nominal charge for copying and/or
mailing.


APPENDIX

CHECKLIST

As part of a section 401(h) or section 420 determination letter request
described in section 16 of this revenue procedure the following checklist
may be completed and attached to the determination letter request. If the
request relates to section 401(h) but not to section 420, complete Part I
only. If the request relates to section 420, complete Parts I and II.


PART I

CIRCLE SECTION
------- -------
1. Does the Plan contain a medical benefits account Yes No ____
within the meaning of section 401(h) of the Code?
If the medical benefits account is a new
provision, items "a" through "h" should be
completed.

a. Does the medical benefits account specify the Yes No ____
medical benefits that will be available and
contain provisions for determining the amount
which will be paid?

b. Does the medical benefits account specify who Yes No ____
will benefit?

c. Does the medical benefits account indicate Yes No ____
that such benefits, when added to any life
insurance protection in the Plan, will be
subordinate to retirement benefits? (This
requirement will not be satisfied unless the
amount of actual contributions to provide
section 401(h) benefits (when added to
actual contributions for life insurance
protection under the Plan) does not exceed
25 percent of the total actual contributions
to the Plan (other than contributions to fund
past service credits), determined on an
aggregate basis since the inception of the
section 401(h) arrangement.)

d. Does the medical benefits account maintain Yes No ____
separate accounts with respect to
contributions to key employees (as defined in
section 416(i)(1) of the Code) to fund such
benefits?

e. Does the medical benefits account state that Yes No ____
amounts contributed must be reasonable and
ascertainable?

f. Does the medical benefits account provide for Yes No ____
the impossibility of diversion prior to
satisfaction of liabilities (other than item
"7" below)?

g. Does the medical benefits account provide for Yes No ____
reversion upon satisfaction of all
liabilities (other than item "7" below)?

h. Does the medical benefits account provide Yes No ____
that forfeitures must be applied as soon as
possible to reduce employer contributions to
fund the medical benefits?


PART II

2. Does the Plan limit transfers to "Excess Assets" Yes No ____
as defined in section 420(e)(2) of the Code?

3. Does the Plan provide that only one transfer may Yes No ____
be made in a taxable year (except with regard to
transfers relating to prior years pursuant to
section 420(b)(4) of the Code)?

4. Does the Plan provide that the amount Yes No ____
transferred shall not exceed the amount
reasonably estimated to be paid for qualified
current retiree health liabilities?

5. Does the Plan provide that no transfer will be Yes No ____
made after December 31, 2005?

6. Does the Plan provide that transferred assets Yes No ____
and income attributable to such assets shall be
used only to pay qualified current retiree
health liabilities for the taxable year of
transfer?

7. Does the Plan provide that any amounts Yes No ____
transferred (plus income) that are not used to
pay qualified current retiree health liabilities
shall be transferred back to the defined benefit
portion of the Plan?

8. Does the Plan provide that amounts paid out of a Yes No ____
health benefits account will be treated as paid
first out of transferred assets and income
attributable to those assets?

9. Does the Plan provide that participants' accrued Yes No ____
benefits become nonforfeitable on a termination
basis (i) immediately prior to transfer, or (ii)
in the case of a participant who separated
within 1 year before the transfer, immediately
before such separation?

10. In the case of transfers described in section Yes No ____
420(b)(4) of the Code relating to 1990, does
the Plan provide that benefits will be
recomputed and become nonforfeitable for
participants who separated from service in
such prior year as described in section
420(c)(2)?

11. Does the Plan provide that transfers will be Yes No ____
permitted only if each group health plan or
arrangement contains provisions satisfying
section 420(c)(3) of the Code, as amended by
TREA '99?

12. Does the Plan define "applicable employer Yes No ____
cost", "cost maintenance period" and "benefit
maintenance period", as needed, consistently
with section 420(c)(3) of the Code, as amended
by TREA '99?

13. Do the Plan's provisions reflect the transition Yes No ____
rule in section 535(c)(2) of TREA '99, if
applicable?

14. Does the Plan provide that transferred assets Yes No ____
cannot be used for key employees?

<<END RULING>>


 

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