PLR 200646021: Pension amortization extension denied after increased contributions

Number

200646021

Outcome

Denied

Document type

Private Letter Ruling

IRS subject

Minimum Funding Standards

Topics

Retirement plans, IRAs, and annuities

Code sections

§ 412

Ruling dated

August 23, 2006

Publicly released

November 17, 2006

Source

View Official PDF

Apply this to your situation

This page covers one taxpayer's ruling, issued in 2006, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It resolved one taxpayer's situation on its specific facts, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.

About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.

Transcribed from a scanned original: the IRS released this determination as an image-only PDF. The full text below is a machine transcription, proofread against the scan. Check the original PDF before quoting exact language.

View official IRS release (PDF)

Plain-English summary

A defined benefit pension plan requested more time to amortize its liabilities under section 412(e). The IRS denied the request because a negotiated increase in contributions addressed the plan's current financial problems in the actuary's projections. The IRS had offered a conference after its tentative denial. The plan did not schedule one within the 21-day period, so the tentative denial became final. The released letter redacts the relevant plan year and contribution amount.

Ruling snapshot

Question: Could the plan extend its amortization periods under section 412(e)?
Outcome: Denied after the conference period passed.
Key authorities: IRC § 412(e).

Full text (IRS public release)

Significant Index No. 0412.00-00
200646021

DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
WASHINGTON, D.C. 20224

TAX EXEMPT AND
GOVERNMENT ENTITIES
DIVISION

AUG 23 2006

SE:T:EP:RA:T:A2

Re:

This letter constitutes notice that with respect to the above-named defined benefit pension plan, your request for an extension of amortization periods under section 412(e) of the Internal Revenue Code (“Code”) for the plan year beginning January 1, , has been denied.

You were informed of our tentative denial and were offered a conference of right by letter dated July 24, . You were given 21 days to schedule a conference concerning our tentative denial. Our tentative denial was based on the Taxpayer having negotiated an estimated increase of in contributions for the plan year. The projections submitted by the Plan’s actuary showed that the increase of

in contributions for has addressed the Plan’s current financial problems.

The 21-day period stated in our July 24th letter has passed and your authorized representative has communicated with us to that you do not want to schedule a conference. Therefore, our tentative denial is now final.

2 200646021

A copy of this letter has been sent to the authorized representatives listed on the power of attorney (Form 2848) on file with this office. If you have any questions concerning this matter, please contact

Sincerely,

James E. Holland, Jr., Manager

Employee Plans Technical

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