SECTION 6. STANDARDIZED PLANS

• EMPLOYER RELIANCE

.01 Reliance - An employer adopting a standardized plan or paired plans may rely on its opinion letter, except as provided in subsections .02, .03, and .04 below.

.02 Non-Reliance by Employer Maintaining More than One Plan - Except in the case of a combination of paired plans or as otherwise provided in this subsection, an employer may not rely on an opinion letter for a standardized plan, without obtaining a determination letter, if the employer maintains at any time, or has maintained at any time, another plan, including a standardized plan, that was qualified or determined to be qualified covering some of the same participants. For this purpose, a plan that has been properly replaced by the adoption of a standardized plan is not considered another plan. The plan that has been replaced and the standardized plan must be of the same type (e.g., both money purchase pension plans) in order for the employer to be able to rely on the standardized plan without obtaining a determination letter. In addition, an employer that adopts a standardized defined contribution plan will not be considered to have maintained another plan merely because the employer has maintained another defined contribution plan(s), provided such other plan(s) has been terminated prior to the effective date of the

standardized plan and no annual additions have been credited to the account of any participant under such other plan(s) as of any date within a limitation year of the standardized plan. Likewise, an employer that adopts a standardized defined contribution plan that is first effective on or after the effective date of the repeal of § 415(e) will not be considered to have maintained another plan merely because the employer has maintained a defined benefit plan(s), provided the defined benefit plan(s) has been terminated prior to the effective date of the standardized defined contribution plan.

.03 Reliance by Employer Adopting a Standardized Defined Benefit Plan - An employer that has adopted a standardized defined benefit plan may rely on an opinion letter with respect to the requirements of § 401(a)(26) only if the plan satisfies the requirements of § 401(a)(26) with respect to its prior benefit structure or is deemed to satisfy § 401(a)(26) under the regulations. However, an employer may request a determination letter if the employer wishes to have reliance as to whether the plan satisfies § 401(a)(26) with respect to its prior benefit structure.

.04 No Automatic Reliance on Certain Issues - An employer that adopts a standardized plan may not rely on an opinion letter with respect to: (a) whether the timing of any amendment to the plan (or series of amendments) satisfies the nondiscrimination requirements of § 1.401(a)(4)–5(a), except with respect to plan amendments granting past service that meet the safe harbor described in § 1.401(a)(4)–5(a)(3) and are not part of a pattern of amendments that significantly discriminates in favor of highly compensated employees; or (b) whether the plan satisfies the effective availability requirement of § 1.401(a)(4)–4(c) with respect to any benefit, right, or feature. An employer that adopts a standardized plan as an amendment to a plan other than a standardized plan may not rely on an opinion letter with respect to whether a benefit, right, or feature that is prospectively eliminated satisfies the current availability requirements of § 1.401(a)–4 of the regulations. Such an employer may request a determination letter if the employer wishes to have reliance as to whether the prospectively eliminated benefit, right, or feature satisfies the current availability re

2000–6 I.R.B. 561 February 7, 2000

quirements. A standardized plan may give an employer the option to elect to continue to apply the pre-GUST family aggregation rules in years beginning after December 31, 1996, or the combined plan limit of § 415(e) in years beginning after December 31, 1999, to the extent such election(s) conforms to the plan’s operation. However, an employer that elects to continue to apply the pre-GUST family aggregation rules or the combined plan limit of § 415(e) will not be able to rely on the opinion letter without a determination letter with respect to the qualification of its plan for the years to which the election applies.

.05 Effect of Termination of Paired Plan - If an employer maintains paired plans, the termination of one of the paired plans will not adversely affect the employer’s ability to rely on the opinion letter with respect to the other paired plan(s).

.06 Sharing Basic Plan Document By Standardized, Nonstandardized, and Nonstandardized Safe Harbor Plans - A sponsor may establish a basic plan document that applies to a standardized plan, a nonstandardized plan, and a nonstandardized safe harbor plan. Such plans may differ only by the different adoption agreements. For example, the adoption agreement(s) for the nonstandardized plan and/or the nonstandardized safe harbor plan may have additional coverage options.