New Determination Letter Process for Tax-Qualified Employee Benefit Plans: Preparing for Massive Changes

In July 2016, the Internal Revenue Service issued Rev. Proc. 2016-37, announcing major changes to its determination letter program for tax-qualified retirement plans. Under the new program, determination letters will be significantly scaled back for both individually designed plans and pre-approved plans. The new program is scheduled to commence in 2017 and represents a significant challenge to benefits practitioners, as well as to CPAs who perform audits of plans.

The scope of the changes is massive. Due to resource restrictions, the Service is ending the familiar five-year remedial cycle for plan administrators to submit the plan for review. Plans assigned to the current cycle must be submitted to the IRS by Jan. 31, 2017, to receive a determination letter under the current program, and amendments to plans operating under a current favorable letter may not be relied upon as to the compliance of the amended provision.

The IRS just issued new EPCRS rules in response to the reduction of the determination letter program, with additional guidance to address questions such as whether a successor to another plan is deemed a “new” plan, when can form amendments be adopted, and other key concerns. Plan professionals and auditors dealing with employee plans need to fully grasp the new determination letter regulations in evaluating plan compliance.

Listen as our experienced panel provides a critical and thorough look at the new determination letter program for tax-qualified employee benefit plans.

1. Specific changes to employee benefit plan determination letter program
2. Elimination of determination letters for amendments to existing plans
3. Elimination of five-year amendment cycle after Jan. 31, 2017
4. ECPRS changes in conjunction with scaling-back of determination letter program
5. Impact of tax return due dates on plan contribution deadlines
6. Additional guidance

The panel will discuss these and other critical questions:

• How does the elimination of the five-year amendment cycle under the new regulations impact plan administrators in making amendments to existing plans?
• Under the new rules, what plans may submit determination letter applications?
• For plans covered by current five-year remedial plan Cycle A, what is the deadline for submitting a request for a determination letter?
• What transition steps and provisions has the Service established during the program transition?
• What additional guidance and changes to ECPRS has the Service made to assist plan professionals?
• What is the impact of the change in return due dates on employers who make their plan contributions by the due date?

Learning Objectives

After completing this course, you will be able to:

• Identify the specific changes to the employee benefit plan determination letter program
• Recognize the impact of the elimination of the five-year remedial cycle on determination letter requests
• Discern the impact of amendments to plans operating under a current determination letter
• Determine the impact of newly-announced changes to the ECPRS program adopted in the wake of the new determination letter process

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Prerequisites: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules, supervising other preparers/accountants. Specific knowledge and understanding of Section 401a tax qualified retirement plan structures, including plan amendment processes; familiarity with the current determination letter submittal process for employee benefit plans; familiarity with distinction between individually-designed employee plans and pre-approved plans

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IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).