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IRS Releases 2011 Cumulative List of Changes in Plan Qualification Requirements
Practical Law Legal Update 9-516-5492 (Approx. 4 pages)
IRS Releases 2011 Cumulative List of Changes in Plan Qualification Requirements
by PLC Employee Benefits & Executive Compensation
| Published on 13 Dec 2011 • USA (National/Federal) |
The IRS recently issued Notice 2011-97, which provides the 2011 Cumulative List of Changes in Plan Qualification Requirements. The Cumulative List provides the changes to employee benefit plan requirements that have been specifically identified for review by the IRS when it determines if a plan has been properly updated.
IRS Notice 2011-97
Pending publication in Internal Revenue Bulletin 2011-52 on December 27, 2011, IRS Notice 2011-97, provides the 2011 Cumulative List of Changes in Plan Qualification Requirements (Cumulative List). The Cumulative List contains a compilation of changes to employee benefit plan requirements that are embodied in statutes and IRS guidance. The IRS publishes a Cumulative List annually, in accordance with Section 4 of IRS Revenue Procedure 2007-44. The 2011 Cumulative List contains the plan qualification requirements from the 2007, 2008, 2009 and 2010 Cumulative Lists, as well as new requirements made in 2011 (the changes that were not in previous Cumulative Lists are labeled as "New" in the 2011 Cumulative List).
Employee benefits plan sponsors, administrators and attorneys will rely on the Cumulative List when they submit determination letter applications to the IRS during the submission period that begins February 1, 2012 and ends January 31, 2013 (see Practice Note, Applying for an IRS Determination Letter). The changes contained in the Cumulative List are specifically identified for review by the IRS regarding whether a plan filing in Cycle B has been properly updated. The IRS will not consider in its review of determination letter applications any guidance issued or statutes enacted after October 1, 2011, except for:
- The 2010 final hybrid plan regulations.
- Matters addressed by proposed regulations that are cited in Notice 2011-97.
The Cumulative List applies mainly to:
- Single employer individually designed defined contribution plans, including employee stock ownership plans (ESOPs).
- Single employer individually designed defined benefit plans.
- Multiple employer individually designed plans that are in Cycle B (usually, an individually designed plan is in Cycle B if the last digit of the employer identification number of the plan sponsor is two or seven).
The changes in the Cumulative List do not extend the deadline by which a plan must be amended to comply with statutory, regulatory or guidance changes. For a plan to be qualified, it must comply with all qualification requirements, not just those in the Cumulative List.
The 2011 Cumulative list includes relevant legal changes as set out in:
- The Pension Protection Act of 2006.
- The U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act.
- The Heroes Earnings Assistance and Relief Tax Act of 2008.
- The Worker, Retiree, and Employer Recovery Act of 2008.
- The Small Business Jobs Act of 2010.
- The Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010 (PPA 2010).
The 2011 Cumulative List provides changes in 35 different sections of the Internal Revenue Code. For example, a new change to the Cumulative List includes Section 431(b)(8) of the Internal Revenue Code, which was added under PPA 2010. This section provides two special funding rules for multiemployer plans.
Practical Implications
Employee benefit plan sponsors, administrators and attorneys should rely on the 2011 Cumulative List when they submit determination letter applications during the period that begins February 1, 2012 and ends January 31, 2012 (see Practice Note, Applying for an IRS Determination Letter: Timeframe for Filing for an IRS Determination Letter). However, the Cumulative List does not extend the deadline by which a plan must be amended to comply with statutory, regulatory or guidance changes. Guidance issued or statutes enacted after October 1, 2011 will not be reviewed by the IRS. For a collection of resources relating to filing IRS determination letters, see Retirement Plan Determination Letters Toolkit.