Plans That Missed EGTRRA Deadline
Rev. 05/13/07; E-mail Alert 2007-9

Updated by Rev. Proc. 2008-56

Revenue Procedure 2007-49 addresses the process for GUST preapproved plans that missed being on a preapproved provider list for the EGTRRA document round by the January 31, 2006 deadline.

This procedure states that plans with existing GUST letters may be submitted after the deadline using a modified “streamlined” voluntary compliance procedure with a $375 penalty. They will be reviewed after the timely submitted plans, but will be deemed to be timely submissions with all the appropriate reliance. The timing of the document review may result in employers having less than the normal period to adopt these late submitted plans once the opinion or advisory letter is issued. Note that at this time, the IRS is estimating that employers will normally have about two years to adopt their EGTRRA restatements after their sponsor/practitioner receives their opinion or advisory letter.

MHCO Comment: We are glad that the IRS has addressed the issue of those who did not timely submit. However, we are still looking for additional guidance that would enable entities that previously did not sponsor a pre-approved plan (and thus did not or could not submit by January 31, 2006) to submit for opinion letters without having to wait until the next six-year cycle which begins in February 2011. This will be especially problematic for new companies formed after some still unannounced date in early 2008, that desire to sponsor their own plans rather than using someone else's pre-approved document. Under the current guidance, such new entrants may not even be identical adopters of a mass-submitter's pre-approved document.