Section 2. Background

.01 Section 412(c)(5)(A) of the Internal Revenue Code, as amended, and § 302(c)(5)(A) of the Employee Retirement Income Security Act of 1974 (ERISA), as amended, state that if the funding method of a plan is changed, the new funding method shall become effective only if the change is approved by the Secretary.

.02 Section 1.412(c)(2)–1 of the Income Tax Regulations generally provides that a change in the actuarial valuation method used to value the assets of a plan is a change in funding method that requires approval under § 412(c)(5) of the Code.

.03 Rev. Proc. 95–51 provides approval for certain changes in funding method. Section 3 of Rev. Proc. 95–51 provides approval for changes to 14 specific methods including three asset valuation methods. Section 4 of Rev. Proc. 95– 51 provides four special approvals for changes. Section 5 of Rev. Proc. 95–51 provides rules relating to the establishment and maintenance of amortization bases upon changing methods. Section 6 of Rev. Proc. 95–51 provides restrictions under the revenue procedure.