Sample Comment Letter to IRS
Many people who work for nonprofit organizations that are associated with religious organizations – hospitals, schools, community centers – have begun to receive notices informing them that their pension plan is planning to seek approval from the Internal Revenue Service that would allow it to become a church plan.
Below is an example of a letter that the people who receive these notices can send to the IRS to voice their concerns about their pension plan's proposed change to a church pension plan. Please feel free to modify this letter to suit your needs. The text in bold should be modified for each person sending the letter.
Sample Comment Letter to IRS
Internal Revenue Service
Attention: EP Letter Rulings
P.O. Box 27063
Washington, DC 20038
Re: Request for church plan ruling by [Name of Employer] for the [Name of Plan], EIN 22-148730
To the Internal Revenue Service:
I have been a participant in the [name of plan] for [specific number] years. I recently received a notice from my employer informing me that it intends to ask the Internal Revenue Service for a ruling that the [name of plan] is a “church plan”. The notice says that if this ruling request is granted I will lose all protections provided by the federal private pension law and that I may contact the IRS to voice my concerns.
I am writing to tell you that the [name of plan] is not, and has never been, a “church plan” and what it would mean to me if the IRS grants my employer’s request to become a church plan. In addition, I would like to have the opportunity to make an oral presentation to the IRS about this very important matter.
The reasons that [name of plan] should not be granted “church plan” status are:
- The [name of plan] was not established by a church and is not (and has never been) maintained by a church. The [name of plan] was established and has been maintained at all times by [name of employer] for its employees. [Name of employer] is a nonprofit association, hospital, school that [describe your employer does].
- The [name of plan] is not maintained by an organization whose principal purpose is the funding or administration of a retirement plan. The plan is maintained by [name of employer] whose principal purpose is [providing health and medical services/running a school/operating a community center/sponsoring an association].
- When I started work at [name of the employer] in [year] the [name of plan] gave me a booklet that told me that it was paying premiums to the Pension Benefit Guaranty Corporation to insure my pension. That booklet and other booklets, statements, and oral communications over the years told us that we were protected by the federal pension law, ERISA. To my knowledge the [name of plan] has at all times been maintained as an ERISA plan.
I am worried that my pension and future retirement security will be at risk if the IRS grants the “church plan” ruling requested by [name of employer]. That is because the [name of plan] is currently underfunded, which I've been told means that it does not have enough money to pay all promised benefits. If the ruling request is granted and [name of employer] were to terminate the plan, I could lose most or all of the benefits I worked [number] years as [a name of occupation] to earn.
Throughout my working years, I considered the pension to be an important part of my pay package and it was a reason that I continued to work at [name of employer]. I am [age] years old and do not have the time or ability to start earning a pension all over again. My Social Security benefits will not be enough to live on in retirement and I do not have enough in savings to last throughout my retirement years. If you grant the [name of employer’s] ruling request, I will not be able to pay my bills when I retire. Please deny the request.
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Did You Know?
A joint-and-survivor annuity is an annuity that pays a monthly benefit over the lives of the participant and his or her surviving spouse. This is the default form of benefit for married participants in most defined benefit pension plans. Because it lasts for the life of both the worker and the spouse, a joint-and-survivor annuity typically results in a lower monthly benefit payment than a single-life annuity.