The IRS is planning to make significant reductions in its employee plans determination letter program for qualified plans.
According to Announcement 2015-19, effective Jan. 1, 2017, the IRS will eliminate the staggered 5-year determination letter remedial amendment cycles for individually designed plans and will limit the scope of the determination letter program for individually designed plans to initial plan qualification and qualification upon plan termination.
As a result of the elimination of the 5-year remedial amendment cycles, the extension of the remedial amendment period provided in Section 5.03 of Revenue Procedure (Rev. Proc.) 2007-44 will not be available after Dec. 31, 2016, and the remedial amendment period definition in Treas. Reg. §1.401(b)-1 will apply. However, the IRS intends to extend the remedial amendment period for individually designed plans to a date that is expected to end no earlier than Dec. 31, 2017.
Announcement 2015-19 also says that, effective July 21, 2015 and through Dec. 31, 2016, the IRS will not accept determination letter applications that are submitted off-cycle, except as except for determination letter applications for new plans, as defined in section 14.02(2) of Rev. Proc. 2007-44, and for terminating plans.
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