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CCH® PENSION AND BENEFITS — 10/19/06

IRS provides updated guidance on staggered remedial amendment periods

The IRS Employee Plans group has made publicly available two recent Quality Assurance Bulletins (QABs) dealing with the staggered remedial amendment period system. Under the current IRS system, applications for favorable determination, advisory, and opinion letters must comply with the submission dates for remedial amendment periods. Submission dates for pre-approved plans are generally on a six-year cycle and submission dates for individually-designed plans (IDPs) are generally on a five-year cycle.

QAB FY-2006 No. 2 revises an earlier version of the QAB issued in January 2006. The QAB provides guidance to an employer that changes from a pre-approved plan to an individually-designed plan (IDP) or that amends out of prototype status. On-cycle and off-cycle filing of determination letters are discussed in the QAB, as well as interim amendments and applications filed in connection with a terminating plan. A flow chart is provided illustrating the EGTRRA remedial amendment period for individually designed plans. The revisions to the QAB clarify that a parent-subsidiary organization may make a controlled group election to use either Cycle A (the first of five periods) or the parent’s EIN to determine the cycle.

QAB FY-2006 No. 4 provides guidance and caveats for IDPs under the staggered remedial amendment period system. The QAB addresses on-cycle and off-cycle filing of determination letters, interim and discretionary amendments, the use of Form 5621, and closing actions.

For more information on this and related topics, consult the CCH Pension Plan Guide.

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