PART III. PROCEDURES FOR LETTER RULING REQUESTS

PART IIIA. REQUESTING LETTER RULINGS

.01 Employee Plans Rulings and Agreements issues letter rulings on proposed transactions and on completed transactions either before or after the taxpayer’s return covering the issue presented in a ruling request is filed. Employee Plans Rulings and Agreements only issues letter rulings involving:

(1) Section 72 (involving computation of the exclusion ratio only);

(2) Changes in funding methods (see Rev. Proc. 2017-57, 2017-44 IRB 474) and actuarial assumptions under § 412, 430, 431 or 433;

(3) Waiver of the liquidity shortfall (as that term is defined in § 430(j)(4)) excise tax under § 4971(f)(4);

(4) Waiver of the 60-day rollover requirement under §§ 402(c)(3) and 408(d)(3) (see Rev. Proc. 2003-16, 2003-4 IRB 359, as modified by Rev. Proc. 2016-47, 2016-37 IRB 37, and by Rev. Proc. 2020-46, 2020-45 IRB 995);

(5) A change in the plan year of an employee retirement plan and the trust year of a tax‑exempt employees’ trust (see Rev. Proc. 87-27, 1987-1 CB 769);

(6) The tax consequences of prohibited transactions under §§ 503 and 4975;

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Generally not in employee plans qualification matters

Request to Employee Plans Rulings and Agreements for extension of time for making an election or for other relief under § 301.9100-1

(7) Whether individual retirement accounts established by employers or associations of employees meet the requirements of § 408(c) (see Rev. Proc. 87-50; Rev. Proc. 92-38; Rev. Proc. 98-59; Rev. Proc. 2002-10, and Rev. Proc. 2010-48, as modified by Appendix A of this revenue procedure);

(8) Requests for relief under § 301.9100 to recharacterize contributions to a Roth IRA (see section 24.03 of this revenue procedure with respect to elections under § 301.9100-1);

(9) Requests by the plan sponsor of a multiemployer pension plan for approval of an extension of an amortization period in accordance with § 431(d), including requests in connection with an extension of an amortization period involving whether a plan amendment is reasonable and provides for only de minimis increases in plan liabilities in accordance with §§ 401(a)(33) and 412(c)(7)(B)(i) (see Rev. Proc. 2010-52, 2010-52 IRB 927);

(10) Requests for the return to the employer of certain nondeductible contributions (see Rev. Proc. 90–49, 1990–2 CB 620, as modified by Appendix A of this revenue procedure); or

(11) Requests for approval of the use of a substitute mortality table in accordance with § 430(h) (3)(C) (see Rev. Proc. 2017-55, 2017-43 IRB 373).

Letter rulings involving other issues relating to qualified plans may be issued by the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). Procedures for requesting letter rulings under the jurisdiction of the Office of Associate Chief Counsel are set forth in Rev. Proc. 2024-1, this Bulletin.

.02 The Employee Plans Rulings and Agreements office ordinarily will not issue letter rulings on matters involving a plan’s status under §§ 401 through 420 and § 4975(e)(7). These matters are generally handled by EP Determinations pursuant to this revenue procedure and Rev. Proc. 2022-40. Occasionally these matters may be handled by the Office of Associate Chief Counsel (Employee Benefits, Exempt Organizations, and Employment Taxes). See section 4.02(12) of Rev. Proc. 2024-3, this Bulletin.

.03 Employee Plans Rulings and Agreements will consider a request for an extension of time for making an election under § 301.9100-3 to recharacterize annual contributions made to a Roth IRA. Employee Plans Rulings and Agreements will also consider recharacterization requests under § 301.9100-3 that relate to a conversion or rollover contribution to a Roth IRA but only if the rollover or conversion was made prior to January 1, 2018.

With respect to recharacterization of a Roth IRA, Employee Plans Rulings and Agreements will consider a request for an extension of time for making an election or other application for relief under § 301.9100-1 even if submitted after the return covering the issue presented in the § 301.9100-1 request has been filed and even if submitted after an examination of the return has begun or after the issues in the return are being considered by the Independent Office of Appeals or a federal court. In such a case, Employee Plans Rulings and Agreements will notify the Director, Small Business/Self-Employed (SB/SE) Examinations.

Section 301.9100-1 requests, even those submitted after the examination of the taxpayer’s return has begun, are letter ruling requests that should be submitted pursuant to this revenue procedure, including payment of the applicable user fee referenced in section 6.02(15) of this revenue procedure. In addition, the taxpayer must include the information required by § 301.9100-3(e).

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Issuance of a letter ruling before the issuance of a regulation or other published guidance

However, an election made pursuant to § 301.9100-2 is not a letter ruling and does not require payment of any user fee. See § 301.9100-2(d). Such an election pertains to an automatic extension of time under § 301.9100-1.

.04 Unless the issue is covered by section 25 of this revenue procedure, a letter ruling may be issued before the issuance of a temporary or final regulation or other published guidance that interprets the provisions of any act under the following conditions:

(1) Answer is clear or is reasonably certain. If the letter ruling request presents an issue for which the answer seems clear by applying the statute to the facts or for which the answer seems reasonably certain but not entirely free from doubt, a letter ruling will be issued; or

(2) Answer is not reasonably certain. If the letter ruling request presents an issue for which the answer does not seem reasonably certain, Employee Plans Rulings and Agreements may issue the letter ruling, using its best efforts to arrive at a determination, if it is in the best interest of tax administration. Under these circumstances, coordination with the Office of Chief Counsel generally will be required.

However, a letter ruling will not be issued if the letter ruling request presents an issue that cannot be readily resolved before a regulation, or any other published guidance is issued.

Issues in prior return .05 Employee Plans Rulings and Agreements ordinarily does not issue letter rulings if, at the time the ruling is requested, the identical issue is involved in the taxpayer’s return for an earlier period, and that issue:

(1) is being examined by the Director, Employee Plans Examinations;

(2) is being considered by the Independent Office of Appeals;

(3) is pending in litigation in a case involving the taxpayer or related taxpayer; or

(4) has been examined by the Director, Employee Plans Examinations, or considered by the Independent Office of Appeals, and the statutory period of limitation has not expired for either assessment or filing a claim for a refund or a closing agreement covering the issue of liability has not been entered into by the Director, Employee Plans Rulings and Agreements, or by the Independent Office of Appeals.

If a return dealing with an issue for a particular year is filed while a request for a ruling on that issue is pending, Employee Plans Rulings and Agreements will issue the ruling unless it is notified by the taxpayer or otherwise learns that an examination of that issue or the identical issue on an earlier year’s return has been started by the Director, Employee Plans Examinations. See section 6.05 of this revenue procedure. However, even if an examination has begun, Employee Plans Rulings and Agreements ordinarily will issue the letter ruling if the Director, Employee Plans Examinations, agrees, by memorandum, to permit the ruling to be issued.

Generally not to business associations or groups

.06 Employee Plans Rulings and Agreements does not issue letter rulings to business, trade, or industrial associations or to similar groups concerning the application of the tax laws to members of the group. Employee Plans Rulings and Agreements, however, may issue letter rulings to groups or associations on their own tax status or liability if the request meets the requirements of this revenue procedure.

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Generally not to foreign governments

.07 Employee Plans Rulings and Agreements does not issue letter rulings to foreign governments or their political subdivisions about the U.S. tax effects of their laws. However, Employee Plans Rulings and Agreements may issue letter rulings to foreign governments or their political subdivisions on their own tax status or liability under U.S. law if the request meets the requirements of this revenue procedure.

Generally not on federal tax .08 Employee Plans Rulings and Agreements does not issue letter rulings on a matter involving consequences of proposed the federal tax consequences of any proposed federal, state, local, municipal, or foreign legislation. legislation

SECTION 25. UNDER WHAT CIRCUMSTANCES DOES EMPLOYEE PLANS RULINGS AND AGREEMENTS HAVE DISCRETION TO ISSUE LETTER RULINGS?

Ordinarily not in certain areas because of factual nature of the problem

.01 Employee Plans Rulings and Agreements ordinarily will not issue a letter ruling in certain areas because of the factual nature of the problem involved or because of other reasons. Employee Plans Rulings and Agreements may decline to issue a letter ruling if appropriate in the interest of sound tax administration, including due to resource constraints, or on other grounds whenever warranted by the facts or circumstances of a particular case.

No “comfort” letter rulings .02 No letter ruling will be issued with respect to an issue that is clearly and adequately addressed by statute, regulations, decision of a court of appropriate jurisdiction, revenue ruling, revenue procedure, notice, or other authority published in the Internal Revenue Bulletin.

Not on alternative plans or hypothetical situations

Ordinarily not on part of an integrated transaction

Not on partial terminations of employee plans

.03 A letter ruling will not be issued on alternative plans of proposed transactions or on hypothetical situations.

.04 Employee Plans Rulings and Agreements ordinarily will not issue a letter ruling on only part of an integrated transaction. If, however, a part of a transaction falls under a no-rule area, a letter ruling on other parts of the transaction may be issued. In this case, before preparing the letter ruling request, the taxpayer should call the office having jurisdiction for the matters on which the taxpayer is seeking a letter ruling to discuss whether Employee Plans Rulings and Agreements will issue a letter ruling on part of the transaction.

.05 Employee Plans Rulings and Agreements will not issue a letter ruling on the partial termination of an employee plan. However, determination letters involving the partial termination of an employee plan may be issued. See section 9.09 of this revenue procedure.

Law requires a letter ruling .06 Employee Plans Rulings and Agreements will issue a letter ruling on prospective or future transactions if the law or regulations require a determination of the effect of a proposed transaction for tax purposes.

Issues under consideration by the PBGC or the DOL

.07 A letter ruling relating to an issue that is being considered by the PBGC or the DOL, that involves the same taxpayer, shall be issued at the discretion of Employee Plans Rulings and Agreements.

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Domicile in a foreign jurisdiction