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No IRS Rulings on Employer Reversion for Spin-Off/Terminations

June 21, 2022, 4:04 PM

The IRS will not issue private letter rulings debating whether an employer reversion from a qualified plan occurs in a spin-off/termination transaction that involves excess assets, the agency announced in a Revenue Procedure dated June 17.

In a spin-off/termination transaction, excess assets could be spun off to another benefit plan sponsored by the same employer. That plan could be terminated shortly after, or the terminated assets remain in the trust of the terminated plan. The IRS will not rule whether under Section 4980(c)(2) an employer reversion or the amount of money and value of other property received by an ...