IRS may work with an LLC's authorized representatives on a plan matter

Plain-English summary

Chief Counsel advised that the IRS should continue dealing with an LLC in its role as a plan sponsor. The agency could communicate with anyone authorized under state law to act for or bind the LLC. TEFRA partnership procedures did not control because the IRS was not auditing the LLC or disclosing its return information. If contact with someone lacking state-law authority became necessary, section 6103(k)(6) might permit the disclosure.

Ruling snapshot

• Question: With whom may the IRS communicate when an LLC is the sponsor of the plan under review?
• Outcome: Advice given: communicate with persons authorized under state law to act for the LLC, with section 6103(k)(6) potentially covering other necessary contacts.
• Key authorities: IRC § 6103(k)(6)

Full text (IRS public release)

ID:          CCA_2016020909094307             [Third Party Communication:

UILC:        6103.00-00                       Date of Communication: Month DD, YYYY]

Number: 201608015
Release Date: 2/19/2016
From:
Sent: Tuesday, February 09, 2016 9:09:43 AM
To:
Cc:
Bcc:
Subject: RE: Disclosure question


Then you should continue to deal with the plan sponsor. For the LLC as a plan sponsor,
you can deal with anyone who has authority under state law to act/bind the LLC. The
plan sponsor is the LLC so you have to deal with the LLC and then it’s just whoever has
authority to act on behalf of the LLC. The TEFRA part is sort of a red herring. You aren’t
auditing the LLC and you aren’t disclosing the LLC’s return information so TEFRA
doesn’t really come into play. If you need to contact someone other than someone who
has authority under state law to act for the LLC, then 6103(k)(6) may authorize the
disclosure.

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