PEP Plan Determination Letter Requests

The IRS has released information as to what will be required by agents in processing request for determination letters on behalf of PEP (Pension Equity Plan) applicants. The information discuss the issues unique to such plans.

Document Excerpt

The PEP Determinations Worksheet and Explanation of PEP Plan Issues are for IRS employees to use in processing determination letter applications. These documents explain the issues unique to PEP plans that we will take into account when reviewing plan documents, such as how the provision of hypothetical interest impacts the plan’s compliance with the accrual rules of Internal Revenue Code Section 411(b)(1).

The PEP Memorandum highlights the plan document’s compliance with IRC Section 411(b)(1)(G), which generally provides that a participant’s accrued benefit under a qualified defined benefit plan cannot be reduced on account of any increase in the participant’s age or service.


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