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Most qualified plan sponsors seek an advance determination letter from the IRS stating that the plan provisions meet Code requirements. Which of the following statements is accurate about determination letters and their effect in the event of an audit by the IRS?
A. the determination letter program is provided as a free service by the IRS
B. once a favorable determination letter is obtained, the plan does not have to be amended for changes
C. if the plan sponsor did not obtain a determination letter and the plan is found to have a disqualifying provision or lack an essential provision, the plan can lose its tax-exempt status
D. once a favorable determination letter is obtained, the plan does not have to be amended for changes
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Define the flow of funds model provided in the unit.
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