Volume Submitter Adoption Agreement

An employer must accept the provisions of the master`s or prototype plan or draw up its own plan. Employers who adopt a volume enrichment plan should obtain IRS approval for the plan as drafted for that employer. Although the plan is created individually, the user fee collected by the IRS is only 125 $US (the same as for a non-standardized master`s or prototype plan). Another disadvantage is that a master`s or prototype plan can be difficult to work with. The employer must verify both the adoption agreement and the separate plan document to determine the actual terms of their plan. Both documents (and generally the summary description of the plan) contain provisions that do not apply to that particular employer. Other disadvantages are that a “supplier” is a U.S. company that has at least 15 employer customers that it reasonably expects to adopt the same plan pre-approved by the supplier until the required time frame. A supplier may seek advice for any number of pre-approved plans, provided that the supplier has a total of at least 30 employer clients who can reasonably be expected to assume at least one of the supplier`s plans. A U.S. company that proposes a previously approved plan as a word-for-word identical user or minor modifier of a mass enrichment plan is not subject to the minimum number of employers required by that plan.

See section 4.08 of the 2017-41 revenue procedure. A supplier that does not use a mass enrichment plan has other procedural requirements to request an opinion. “Essentially identical” plans can be subject to accelerated revision, even if they are not mass enrichment plans. Non-standardized adoption should be subject to IRS approval (which can destroy any of the goals of using a master plan or prototype). Mass depositors typically receive expedited processing from the IRS because of the large number of providers they represent and the number of identical or nearly identical plans they submit to the IRS. This makes it easier and more efficient for verification purposes. A volume enrichment plan offers employers a large number of legal provisions of the plan, using a language that has been verified by the IRS….

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