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CCH® PENSION — 07/21/11

IRS works to expedite determination letter process for ESOPs

The IRS's Employee Plans (EP) Determinations has taken steps to expedite and improve its determination letter process for ESOPs, including "forming a cadre of determination letter specialists dedicated to reviewing these plans," according to the latest issue of Employee Plans News.

The IRS is changing some procedures for reviewing ESOPs submitted on Form 5300, Applications for Determinations for Employee Benefit Plan, during Cycles C, D, and E for filers who submitted applications for multiple ESOPs. In addition, plan sponsors may use a new IRS worksheet.

Multiple ESOP applications

Practitioners who have submitted applications for multiple ESOPs, and who receive a letter from a determination specialist requesting plan amendments to a particular plan, may determine the applicability of that request to all other plans filed by the practitioner's firm and submit a single response that would apply to some or all of the amendments to the firm's pending ESOP Form 5300 applications. Practitioners should include the letter from the determination specialist requesting the amendment(s) and provide a separate copy of the amendment to each affected plan, identifying the plans to which the proposed amendments apply.

New worksheet developed

EP Determinations has developed a revised, streamlined worksheet to review ESOPs in their initial review stage. The worksheet lists 18 requirements that ESOPs must satisfy. Plan sponsors and practitioners may use the worksheet as a tool to design ESOP plan documents.

Source: IRS Employee Plans News, Issue 2011-5, June 22, 2011.

For more information, visit http://www.wolterskluwerlb.com/rbcs.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer's Benefits Reports.

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