TaxNewsFlash-United States

September 19, 2007
No. 2007-409
    
 

IRS Announces Temporary Closing of Determination Letter Program for Pre-Approved Defined Contribution Plans

The IRS today issued an advance copy of Announcement 2007-90, which states that beginning December 18, 2007, the IRS will temporarily stop accepting applications for determination letters for defined contribution plans that are filed on Form 5307, Application for Determination for Adopters of Master or Prototype or Volume Submitter Plans.

For an electronic version of the two-page guidance: Announcement 2007-90

According to today’s release, the IRS is taking this action because all pre-approved (i.e., master and prototype and volume submitter) defined contribution plans are required to be restated to comply with the Economic Growth and Tax Relief Reconciliation Act of 2001, Pub. L. 107-16, and to be submitted to the IRS for a determination letter (if needed) using Form 5307 during the approximately two-year period which the IRS anticipates will be announced early in 2008.

Accordingly, the temporary closing of the program will allow the IRS to prepare to receive applications pursuant to the 2001 law.

Announcement 2007-90 states that the IRS will continue to process determination letter applications for defined contribution plans filed on Form 5307 before December 18, 2007, provided that the plan has a favorable GUST opinion or advisory letter. Those applications that fail to satisfy one of these requirements will be returned to the applicant.

Announcement 2007-90 will appear in Internal Revenue Bulletin 2007-42, dated October 15, 2007.
 

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