SECTION 3. REQUESTS FOR — Internal Revenue Bulletin 2004-31

APPROVAL TO EXTEND AN AMORTIZATION PERIOD

.01 Who may submit—Only a plan administrator, plan sponsor, or an authorized representative of either may submit a request for approval to extend the period of years required to amortize any unfunded liability. The request must be signed by the taxpayer maintaining the plan (hereinafter referred to as “applicant”) or an authorized representative of the applicant who either must be identified in (a), (b), or (c) of subsection 9.02(11) of Rev. Proc. 2004–4, 2004–1 I.R.B. 125, or must be an enrolled actuary within the meaning of § 7701(a)(35) of the Code. Where an authorized representative signs the request or will appear before the Service in connection with the request, a Form 2848, Power of Attorney and Declaration of Representative, must be submitted with the request. For multiemployer plans, the request must be made by the Board of Trustees (which shall be deemed to be the applicant) or by an authorized representative of the Board of Trustees. An individual is not an authorized representative of the applicant merely on account of being an administrator or trustee of the plan.

2004–31 I.R.B. 134 August 2, 2004

quired to make five percent or more of the total required contributions under the collective bargaining agreements relating to the plan for which the extension is requested. In addition, the applicant must submit a general description of the financial state of the industry in which employees covered by the plan are employed. Regardless of whether any employer makes more than five percent of the total contributions, a general description of the financial state of the industry in which employees covered by the plan are employed is required. For purposes of this paragraph, a multiple employer plan for which the plan administrator did not make an election under § 413(c)(4)(B) of the Code is required to submit the same information as a multiemployer plan. Financial information of employers contributing to a multiemployer plan (identified by name of plan and plan number) must be submitted directly from the contributing employers to the Service at the same time that the submission is made to the following address:

Employee Plans Internal Revenue Service Commissioner, TE/GE Attention: SE:T:EP:RA P.O. Box 27063 McPherson Station Washington, D.C. 20038

(3) Information concerning the extension of the amortization period. Information concerning the extension of the amortization period should include the following.

(a) The unfunded liability for which an extension of the amortization period is requested.

(b) The reasons why an extension of the amortization period is needed.

(d) Information concerning the actions taken by the applicant to reduce the plan’s unfunded liability before the request for an extension has been made. Such actions would include the reduction of future plan benefit accruals and increases in employer contribution rates. Also describe any benefit reductions, contribution rate increases, or other actions that are intended to be taken in the future.

The applicant must provide with the request either a statement of proposed deletions and the statutory basis for each proposed deletion, or a statement that no information other than names, addresses, and taxpayer identifying numbers need be deleted.

(3) The applicant must provide a copy of a written notification to each employee organization representing employees covered by the plan, and each participant, beneficiary, and alternate payee of the plan, that an application for an extension of the amortization period under § 412(e) has been submitted to the Service. The original of the written notification must bear a signature by an appropriate officer of the applicant and must be in substantially the form set forth in the Model Notice found in the Appendix A to this revenue procedure. The Service does not require the applicant to furnish any information in addition to that required by the Model Notice in the Appendix A to plan participants, beneficiaries, alternate payees, or employee organizations as part of the extension application process, but additional information may, of course, be provided by the applicant pursuant to the collective bargaining process or otherwise.

The application must state that such notice was hand delivered or mailed to the last known address of each employee organization, participant, beneficiary, and alternate payee (within the meaning of § 414(p)(8)) within 14 days prior to the date of the application. If the applicant makes a reasonable effort to carry out the provisions of this paragraph, failure of an employee organization, participant, beneficiary, or alternate payee to receive the notice will not cause the applicant to fail the notice requirement. However, merely posting the notice on a bulletin board is not sufficient to satisfy this requirement.

.04 Necessary Information.––The applicant must furnish appropriate evidence that the extension of the amortization period is needed to continue the plan or to prevent a substantial curtailment of pension benefit levels or employee compensation, and that a denial of the extension would be adverse to the interests of the plan participants in the aggregate. What constitutes appropriate evidence will depend on the facts and circumstances of each case. A response must be furnished for each of the paragraphs (1) through (6)

below. In certain cases, some of the material described in paragraphs (1) through (6) may be inapplicable, unavailable, inappropriate or burdensome to furnish. In such cases, the applicant should furnish a statement indicating why the material for a particular paragraph is inapplicable, unavailable, inappropriate or burdensome.

(1) General facts concerning the employer.

A brief statement should be submitted concerning: (a) the history of the employer and its primary business; (b) the ownership of the employer and any recent or contemplated changes (such as acquisitions, mergers, discontinuances of operations) which might have a bearing on the employer’s organization or financial condition; (c) whether the employer is aggregated with any other entity for purposes of § 414(b), (c), (m) or (o); and (d) whether the plan is also maintained by employers described in (c) above or any other employers.

(2) The financial condition of the employer.

For plans other than multiemployer plans, the latest available annual financial report of the employer and each of the other entities included within the controlled group of which the employer is a member. This submission must include at least the balance sheet, profit and loss statement, cash flow statement, and notes to the financial statement. Recent interim financial reports for each of the controlled group members, if available, should also be submitted along with an interim financial report covering the corresponding period for the previous year. If the employer submits financial reports to the Securities and Exchange Commission, these reports should be submitted for the same period as the annual financial report. Preferably, the financial report should include certified financial statements. If certified financial statements have not been prepared, an uncertified report is acceptable. If neither certified nor uncertified reports are available, a copy of the company’s latest available federal income tax return, including all of the supporting schedules, must be submitted.

For multiemployer plans, the financial information described in the above paragraph must only be submitted for employers who either (1) are represented on the Board of Trustees or (2) made or were re

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standard or an extension of an amortization period is contemplated for the plan.

(6) Other information.

(a) Describe the nature of any matters pertaining to the plan which are currently pending or are intended to be submitted to the Service, the Department of Labor or the Pension Benefit Guaranty Corporation.

(b) Furnish details of any existing arbitration, litigation, or court procedure which involves the plan.

.05 Checklist.––A checklist has been provided in Appendix B for the convenience of the taxpayer submitting the request. This checklist should be signed, by the taxpayer or authorized representative, and dated and placed on top of the request.