IRS provides guidance on withdrawal of Cycle C cash balance applications

Cycle C determination letter applicants who intend to adopt a pre-approved cash balance plan may withdraw their applications by May 31, 2014, if they sign Form 8905, Certification of Intent to Adopt a Pre-approved Plan, by March 31, 2014, according to the IRS. Guidance on the withdrawal of Cycle C cash balance applications and FAQs on withdrawing Cycle C applications were provided by the IRS in the latest edition of Employee Plans News.

IRS Announcement 2014-4 extended the submission period for pre-approved defined benefit pension plans from January 31, 2014, to February 2, 2015, to allow time for the IRS to expand the pre-approved program to permit plans with cash balance features. The announcement also allowed Cycle C plan sponsors who want to adopt a pre-approved cash balance plan to complete Form 8905 by March 31, 2014, instead of submitting determination letter applications for individually designed plans by the Cycle C deadline of January 31, 2014.

Cycle C applicants who already submitted their applications for individually-designed cash balance plans during the second Cycle C remedial amendment cycle that ended January 31, 2014, and who instead wish to adopt a pre-approved cash balance plan, may sign the Form 8905, withdraw the application, and request a refund of the user fee by complying with the instructions.

How to request withdrawal and user fee refund

Requests for withdrawal of a Cycle C cash balance application and user fee refunds must be made in writing. The request must be postmarked (or faxed) by May 31, 2014 and must include: (1) the name of the plan sponsor, (2) plan number, (3) EIN, (4) the document locator number, if known (shown on the IRS acknowledgement letter), and (5) the following statement in bold letters: “Per Announcement 2014-4, we are withdrawing this application in order to submit under the pre-approved program.”

Source: IRS Employee Plans News, Issue 2014-4, March 19, 2014.