The Internal Revenue Service (IRS) issued Revenue Procedure 2022-4 (Rev. Proc. 2022-4), which makes several changes to the determination letter program and Voluntary Correction Program (VCP) fees.
Rev. Proc. 2022-4 includes substantive changes to Rev. Proc. 2021-4 and provides:
General information about the types of advice provided by the IRS Tax Exempt and Government Entities Division, Employee Plans Rulings and Agreements Office (Employee Plans Rulings and Agreements).
General procedures for letter ruling and determination letter requests.
Specific procedures for determination letter requests.
The user fees for advice requested from Employee Plans Rulings and Agreements.
Requesting Determination Letters
Rev. Proc. 2022-4 includes the following changes to the determination letter program:
provide that Form 5300, Application for Determination for Employee Benefit Plan, may be submitted electronically beginning June 1, 2022, and must be submitted electronically beginning July 1, 2022; and
update the procedures for submitting Form 5300 and Form 5310, Application for Determination for Terminating Plan, including payment of the user fee.
Sections 6.02(2)(a) and 10.03 have been revised to delete trust documents from the list of required documents that must be included as part of a determination letter submission.
Section 8.02 has been modified to specify that an IRS Form 5307, Application for Determination for Adopters of Modified Volume Submitter Plans, should be used in the case of a determination letter request for a standardized plan that is not a multiple employer plan (MEP) if the employer requests a determination solely on overriding plan language added to satisfy Code Sections 415 or 416 (26 U.S.C. §§ 415 or 416) (see Practice Note, Multiple Employer Retirement Plans (MEPs)).
Section 11.04 has been modified to clarify that when submitting a determination letter application, a plan sponsor of a dual-qualified plan must submit a restatement showing compliance with the Code and applicable lists.
Sections 12.02, 12.03, and 12.04 have been amended to clarify that an adopting employer of a standardized plan does not file a Form 5300 to request a determination related to overriding language necessary to coordinate the application of Code Section 415 limitations (26 U.S.C. § 415) or Code Section 416 requirements (26 U.S.C. § 416) because the employer maintains multiple plans.
Section 14.02 has been modified to clarify the scope of reliance for a determination letter issued for a MEP.
VCP User Fees and Other User Fees
Regarding user fees, Rev. Proc. 2022-4 revises Appendix A, which provides a schedule of user fees, to update the user fees relating to:
Letter ruling requests.
Opinion letters on pre-approved plans submitted pursuant to Rev. Proc. 2017-41.
Practical Implications
Retirement plan sponsors and practitioners should be aware of the changes to the determination letter procedures and IRS fees instituted by Rev. Proc. 2022-4. Rev. Proc. 2022-4 took effect on January 3, 2022.