SECTION 19. ELIGIBILITY FOR

SIX-YEAR REMEDIAL AMENDMENT CYCLE SYSTEM

.01 An employer’s plan is treated as a pre-approved plan and therefore eligible

for a six-year remedial amendment cycle system if the employer is:

(1) a prior adopter described in section 19.02; or (2) a new adopter described in section 19.03. .02 An employer is a prior adopter if the employer adopted and made effective an existing pre-approved plan, as described in section 19.05(1) of this revenue procedure, during the six-year remedial amendment cycle immediately preceding the opening of the current six-year cycle ³

, and the employer, within the announced adoption period described in section 14.03 of this revenue procedure, either:

(1) adopts the newly approved version of that pre-approved plan; or

(2) adopts the newly approved version of a different pre-approved plan maintained by either the same M&P sponsor or VS practitioner or a different M&P sponsor or VS practitioner. See section 19.05(3) of this revenue procedure for the definition of a newly approved preapproved plan.

.03 An employer is a new adopter if the employer adopts a pre-approved plan and the employer is not a prior adopter.

.04 An employer may adopt a preapproved plan at any time during a sixyear remedial amendment cycle; however, if the employer adopts an existing preapproved plan described in section 19.05(1) of this revenue procedure, or an interim pre-approved plan described in section 19.05(2) of this revenue procedure, it must adopt either the newly approved version of the same plan or a newly approved version of a different preapproved plan by the end of the adoption period described in section 14.03 of this revenue procedure (see section 19.05(3) of this revenue procedure for the definition of a newly approved pre-approved plan). An employer that adopts an existing pre-approved plan or an interim preapproved plan, but during the adoption period described in section 14.03 of this revenue procedure, adopts a plan other than a newly approved version of a preapproved plan, will not be treated as

adopting a pre-approved plan. In such case, the plan remains eligible for the current six-year remedial amendment cycle; however, if the plan is submitted for a determination letter (as permitted under section 20.03 of this revenue procedure), the plan will be reviewed on the basis of the applicable Required Amendments List as provided in section 12 of this revenue procedure.

.05 For purposes of this section 19: (1) An existing pre-approved plan is a plan (other than a newly approved plan, as described in section 19.05(3) of this revenue procedure) that has received a valid opinion or advisory letter for the six-year remedial amendment cycle immediately preceding the opening of the current sixyear remedial amendment cycle. For purposes of this definition, a plan is considered an existing pre-approved plan whether or not interim or discretionary amendments have been integrated into the pre-approved plan document.

(2) An interim pre-approved plan is a plan (other than a newly approved plan) that was not in existence in the immediately preceding six-year remedial amendment cycle and that has been or will be submitted for an opinion or advisory letter during the current six-year remedial amendment cycle. For purposes of this definition, a plan is considered an interim pre-approved plan whether or not interim or discretionary amendments have been integrated into the pre-approved plan.

(3) A newly approved plan is a preapproved plan for which an opinion or advisory letter has been issued in the current six-year remedial amendment cycle. ⁴

.06 Examples . Examples 11 through 14 illustrate an employer’s eligibility for the six-year remedial amendment cycle. In the following examples, both the tax year of the employer and the plan year are the calendar year and, except as otherwise provided, the plan has been operated in accordance with plan terms, including any interim and discretionary amendments.

Example 11 : Adoption of plan maintained by different sponsor . Employer L adopted and made

3The current six year remedial amendment cycle as of the date of publication of this revenue procedure began on February 1, 2011, for defined contribution plans and February 1, 2013, for defined benefit plans. The immediately preceding six year remedial amendment cycle ended on January 31, 2011, for defined contribution plans and January 31, 2013, for defined benefit plans.

4See section 21 of this revenue procedure for special rules applicable to an opinion or advisory letter application for a new pre-approved plan created after the submission period for the applicable six-year cycle.

Bulletin No. 2016–29 147 July 18, 2016

.03 Determination letter procedures. (1) An employer that amends a M&P or VS plan loses reliance on the opinion or advisory letter of the M&P or VS plan. However, to the extent permitted in this section 20.03(2) through (5), that employer may file a determination letter application for the plan to obtain reliance. See also, Rev. Proc. 2016–6, section 8.01 (updated annually).

(2) An adopting employer described in section 20.03(1) that modifies the terms of an approved VS plan in situations in which the modifications are not extensive may apply for a determination letter on Form 5307, regardless of whether a prior determination letter has been issued with respect to the plan.

(3) An adopting employer described in section 20.03(1) that makes extensive modifications to an approved VS plan and an adopting employer that makes any modifications to an approved M&P plan may apply for a determination letter on Form 5300. An employer may submit a determination letter application on a Form 5300 only if the application is made upon initial qualification, plan termination, or in other circumstances identified by the IRS. See section 4 of this revenue procedure and Rev. Proc. 2016–6, section 8.01 (updated annually). For this purpose, an employer that previously filed an application on Form 5300 or Form 5307 with respect to the plan and was issued a favorable determination letter is not eligible to file a Form 5300 for initial plan qualification.

(4) Subject to section 20.03(5), an adopting employer described in section 20.03(2) or (3) that files a determination letter application for the plan must file the application within the announced adoption period described in section 14.03 of this revenue procedure. In such case, the employer’s plan is reviewed using the Cumulative List that was used to review the underlying pre-approved plan.

(5) Section 24.03 of Rev. Proc. 2015–36 provides that, due to the nature and extent of employer amendments made to an approved M&P or VS plan, the IRS may, in its discretion, treat the plan as individually designed. In such case, although the plan remains eligible for the six-year remedial amendment cycle until the expiration of the current remedial

effective Plan X on January 1, 2011. Plan X is an existing pre-approved M&P defined contribution plan sponsored by Sponsor M. Plan Y is also a defined contribution M&P plan but sponsored by Sponsor N, which timely submitted an application by April 2, 2012 (the extended deadline to submit oncycle applications for opinion and advisory letters for pre-approved defined contribution plans for the second six-year remedial amendment cycle, as provided in Announcement 2012–3). In Announcement 2014–16, the IRS announced that May 1, 2014 through April 30, 2016 would be the two-year window for employers to adopt newly approved preapproved plans and file determination letters, if applicable.

Sponsor M notified Employer L that it no longer qualified as a sponsor because it did not have the requisite number of employers (30) reasonably expected to adopt Plan X. Therefore, Sponsor M did not submit a new opinion letter application for Plan X within the six-year remedial amendment cycle by April 2, 2012. Employer L timely adopts Plan Y of Sponsor N within the two-year window period (May 1, 2014 through April 30, 2016). Employer L will be considered to be a “prior adopter” within the meaning of section 19.02 of this revenue procedure and is eligible for the six-year remedial amendment cycle. The result would be the same whether Employer L switched to Plan Y because Sponsor M did not timely submit an application by April 2, 2012, for Plan X, Sponsor M timely submitted an application by April 2, 2012 but later withdrew the application, or Employer L chose not to retain the plan of Sponsor M for other reasons.

Example 12 : Adoption of different plan offered by same sponsor . The facts are the same as in Ex- ample 11 except Employer L adopts Plan Z, a different pre-approved M&P defined contribution plan sponsored by Sponsor M, within the announced twoyear window period and Sponsor M timely submitted an application for an opinion letter by April 2, 2012 for Plan Z. Employer L is considered to be a prior adopter and is eligible for the six-year remedial amendment cycle.

Example 13 : Adoption of VS plan in place of M&P plan . The facts are the same as in Example 11 except Employer L adopts Plan V, a VS defined contribution plan instead of an approved M&P plan, within the announced two-year window period and the practitioner timely submitted an application for an advisory letter for Plan V by April 2, 2012. Employer L is considered to be a prior adopter and is eligible for the six-year remedial amendment cycle.

Example 14 : Adoption of plan by new adopter . Employer P has never maintained a qualified plan. Sponsor S timely submitted an application for an opinion letter for Plan Y, an interim pre-approved defined contribution M&P plan (that was not in

existence in the immediately preceding six-year remedial amendment cycle), by April 2, 2012. Employer P adopted the interim pre-approved plan document of Plan Y on December 15, 2012, prior to the announced adoption period (May 1, 2014 through April 30, 2016). On March 28, 2014, the IRS issued a favorable opinion letter for Plan Y. Employer P adopted the newly approved version of Plan Y on June 1, 2014, during the announced adoption period. Employer P is a new adopter and is eligible for the six-year remedial amendment cycle.