IRS Favorable Determination Letter Program

August 19, 2015

The IRS for decades had a "favorable determination letter" program under which employers could get confirmation that their individually designed qualified plans such as 401(k) plans and the like met the IRS' requirements for a tax qualified plan. The IRS now has announced that this program will not be available after 2016 for individually designed "ongoing plans" except for "new plans" or "ongoing plans" that are terminating. We are sending this alert because employers whose EINs end in "0" or "5" still have the opportunity to file for a favorable determination letter until January 31, 2016, and employers whose EINs end in "1" or "6" will have that opportunity during the period beginning on February 1, 2016, and ending (read conservatively) December 31, 2016. We recommend that employers who can file their ongoing plans during these two remaining periods do so. What will happen for ongoing individually designed plans after 2016 remains to be seen.

If you would like to discuss filing your individually designed plan or the IRS' announcement, please contact Donald S. Kohla at 678.336.7140 or Jan G. Marsh at 678.336.7135.

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