requesting a determination letter on the qualification of an employees' plan or trust.

.02 If the request relates to the initial qualification of a plan or the compliance with the requirements for a foreign situs trust, the following information must be submitted:

1. The information required by section 1.404(a)-2 of the Income Tax Regulations;

2. Type of organization of employer;

3. Date incorporated, if a corporation, or date business commenced, if other type of organization;

4. Nature of business of employer;

5. Name of predecessor business, if any, type of organization of predecessor, and when transfer took place; and

6. Date on which the accounting year of the trust ends. .03 If the request relates to an amendment of a plan, the following information must be submitted:

1. A copy of the amendment;

2. The information required by section 1.404 (a)-2 of the regulations unless it was furnished with a request for a determination letter for the same year for which the amendment is to become effective. (However, if the amendment changes the requirements for coverage, contributions, or benefits, the information must be submitted even though previously submitted with a prior request.); and

3. The information required by sections 4.022-4.026, above, unless it was previously furnished with a request for a determination letter.

.04 If the request involves a curtailment or termination of the plan, the following information must be submitted:

1. The date the plan was, or is proposed to be, terminated or curtailed;

2. A statement of the reasons and circumstances for the termination or curtailment:

3. A statement whether any of the funds under the plan will revert to or become available to the employer; if so, details must be furnished;

4. A statement, with full particulars, as to any funds under the plan which at any time were contributed in the form of, or invested in, obligations or property of the employer or related companies;

5. The information specified below, in columnar form, for each of the 25 highest paid employees covered by the plan at the time of termination or curtailment (the most recent anniversary date of the plan if the action is proposed), listed in the order of their compensation, and for all other employees covered by the plan (as a group) and showing the number in the group:

(a) Name and whether an officer or supervisor;

(b) Percentage of each class of stock owned directly or indirectly by the employee or members of his family;

(c) Data, separately for the year of termination or curtailment and for each of the 5 preceding years of the plan's operation (if more are required they will be requested) indicating (1) total compensation other than deferred compensation,

(2) employer's contribution, (3) employee's contribution, and (4) employee's share of forfeitures;

(d) Totals for each of the columns under subparagraph c for each year;

(e) Summary columns aggregating for all years (totaled horizontally) for each employee listed and for all others, data similar to that required by subparagraph c; and

(f) Total value of benefits distributed or to be distributed to each employee listed, and to all others; and

6. A schedule showing separately for the year of termination or curtailment and for each of the 5 preceding years of the plan (if more are required they will be requested):

(a) Number of participants at beginning of year;

(b) Number of participants added in year;

(c) Number of participants dropped in year; and

(d) Number of participants remaining at end of year. .05 If the request involves an investment of trust funds in the stock or securities of the employer, the following information, without duplicating information previously furnished, must be submitted:

1. Balance sheets of the employer (and controlled corporation. if involved) as of the close of the last 2 taxable years;

2. Comparative statements of income and profit and loss for the last 5 taxable years;

3. Analysis of surplus for the last 5 years, specifically showing the amount and rate of dividends paid on each class of stock;

4. A statement accounting for all material changes from the latest dates of the information in 1, 2, and 3 to the date of filing the information;

5. A schedule showing the nature and amounts of the various assets in the trust fund; and

6. A statement setting forth the amount to be invested in the stock or securities of the employer or a controlled corporation (or both), the nature of the investment, the present rate of return. collateral or type of security for the loan, if any, and the reasons for the investment.

The information called for under paragraphs 1, 2, and 6, and related data, may be submitted in composite form as shown in exhibit "A." page 574. A full disclosure must be made where trust funds are invested in stock or securities of, or loaned to, the employer, whether or not a determination letter is requested. The above information must in all cases be furnished to the appropriate District Director. See section 4.07, below.

.06 When in connection with the request for a determination on the qualification of the plan, it is necessary to determine whether an organization is an association taxable as a corporation as defined in section 7701 (a) (3) of the Code, and that an employer-employee relationship exists between it and its associates, the District Director will make such determination. The request, in such case shall also be accompanied by copies of the articles of association or agreement establishing the organization, bylaws, and all other data relevant to the formation and operation of the association, and should show all pertinent dates. The organization should also support its request by

furnishing copies of the applicable local law relating to its status, copies of contracts of employment with its associates, and a brief of its position on its status for taxation and its relationship with its associates. See also Rev. Proc. 65-27, C.B. 1965-2, 1017.

.07 Requests for determination letters on matters authorized by section 3.01 and the necessary supporting data, are to be addressed to the District Director specified below:

1. A single employer will address his request to the District Director for the district in which its principal place of business

is located.

2. If a parent company and its subsidiaries have a single plan, the request will be addressed to the District Director for the district in which the principal place of business of the parent company is located, whether separate or consolidated returns are filed.

3. If the plan is established or proposed for an industry by all subscribing employers whose principal places of business are located within the jurisdiction of more than one District Director, the request will be addressed to the District Director for the district in which is located the principal place of business of the trustee, or if more than one trustee, the usual meeting place of the trustees.

4. In the case of a pooled fund arrangement (individual trusts under separate plans pooling their funds for investment purposes through a master trust), the request on behalf of the master trust will be addressed to the District Director for the district where the principal place of business of such trust is located. Requests on behalf of the participating trusts and related plans will be addressed as otherwise provided herein.

5. In the case of a plan of multiple employers not otherwise herein provided for, the request will be addressed to the District Director for the district in which is located the principal place of business of the trustee, or if not trusteed, or if more than one trustee, the principal or usual meeting place of the trustees or plan supervisors.

6. If the plan is for an organization of the type described in section 4.06, above, the association will address its request to the District Director with whom it is required to file its tax returns. SEC. 5. EFFECT OF PENSION TRUST DETERMINATION LETTERS.

Determination letters issued pursuant to the provisions of this Revenue Procedure have the effect, generally, of any other determination letter as provided in section 13 of Revenue Procedure 67-1. Determination letters issued under the provisions of this Revenue Procedure contain only opinions as to the qualification of plans under sections 101 (a) and 405 (a) of the Code and the status of related trusts under Section 501(a). While a favorable determination letter may serve as a basis for determining deductions for employer contributions thereunder, it is not to be taken as an indication that contributions are necessarily deductible as made. Such determinations can be made only upon an examination of the employer's tax return, in accordance with the limitations and subject to the conditions of section 404 of the Code.

SEC. 6. NATIONAL OFFICE REVIEW OF DETERMINATION LETTERS.

All determination letters issued by District Directors under the procedures herein are subject to post review in the National Office under the jurisdiction of the Assistant Commissioner (Technical). If, during the course of review, a determination letter does not appear to conform to the interpretations and positions of the Service, the District Director will be advised of the exceptions noted. If the taxpayer protests the exceptions taken by the National Office, the matter will be returned to the National Office. The determination letter and the protest will be treated as a request for technical advice. The proce dures in Revenue Procedure 67-2, page 555, this Bulletin, will be followed.

SEC. 7. REFERENCE OF MATTERS TO THE NATIONAL OFFICE.

.01 Revenue Procedure 67-2 defines technical advice as advice or guidance furnished upon request of a field official in connection with the examination or consideration of a return of a taxpayer. Although a taxpayer may request a determination letter on the qualification of its plan or trust under section 401 (a) of the Code prior to the filing of any return affected by the plan or trust, the consideration or examination of the facts relating to the qualification, amendment, curtailment, or termination of the plan or relating to the exempt status of the trust will be considered to be in connection with the examination or consideration of a return of the taxpayer. Thus, a District Direc tor may request technical advice on issues which arise as the result of requests for determination letters of the type discussed in this Revenue Procedure.

.02 Where issues arise in a District Director's office on matters within the contemplation of section 3.01, and the district office does not request technical advice from the National Office, the organization may notify the District Director that it intends to request National Office consideration. The notice will consist of a copy of the request which the organization intends to file with the National Office. See section 7.04 below. Should the District Director make an adverse determination, or should no action be taken within 30 days after the notice is filed with the District Director, the request may be filed with the National Office.

.03 Requests for National Office consideration will be entertained upon a clear showing

1. That the position of the district office is contrary to the law or regulations on the points at issue;

2. That the position of the district office is contrary to the position of the Service as set forth in a Revenue Ruling currently in effect;

3. That the position of the district office is contrary to a court decision which is followed by the Service, i.e., acquiescence in an adverse Tax Court decision;

4. That the contemplated district office action is in conflict with a determination made in a similar case in the same or another district: or

5. That the issues arise because of unique or novel facts which had not previously been passed upon, in any published Revenue Ruling or announcement.

.04 The request to the National Office must show the following: 1. Date of request;

2. Name and address of taxpayer (employer) and name and address of representative, if any, who has been authorized to represent taxpayer (see section 6.05 of Revenue Procedure 67-1); 3. District office in which the case is pending;

4. Type of plan (pension, annuity, profit-sharing, stock bonus) and type of action involved (initial qualification, amendment, curtailment, termination, or investment);

5. Date of filing a copy of this request with the District Director and the date and symbols of determination letter, if any;

6. A concise statement of the issues without presentation of the facts or argumentation (e.g., whether a limitation may be im-. posed on employer contributions used to provide benefits for stockholder-employees);

7. Grounds for requesting National Office consideration, e.g., action of the district office contrary to law or regulations (cite sections involved), contrary to published precedent (cite), conflict between districts or in some district (give name and district of case in conflict), unique or novel facts (describe briefly);

8. Whether the applicable information required by section 4 has been filed with the District Director;

9. Whether a conference is desired in the National Office. .05 Upon receipt of the request in the National Office, a determination will be made as to whether the case is to be considered at the National Office, and the taxpayer will be advised of this determination. If the National Office determines that it will consider the case, the file will be called in from the district office and the taxpayer will be afforded an opportunity to furnish a statement on the points at issue and to a conference in Washington, if such a conference was requested. Copies of all written submissions are to be furnished the District Director. The District Director will have an opportunity to make such comments to the National Office as he deems appropriate. After full consideration of the entire file, including any conference discussion, the National Office will notify the taxpayer of its determination, and the case file will be returned to the district office for appropriate disposition in accordance with the National Office determination. The procedures of Revenue Procedure 67-2 will control, to the extent they are not inconsistent with the provisions of this section.

.06 Should a District Director determine that an organization of the type described in section 4.06 above is not an association taxable as a corporation or that the proper employer-employee relationship does not exist between the organization and its associates, the District Director will so advise the organization. Inasmuch as the primary issue here is not the qualification of the plan under section 401(a) of the Code, the appeals procedures of sections 7.02 through 7.05 are not applicable.

SEC. 8. PROHIBITED TRANSACTIONS.

.01 Section 503 of the Code denies exemption to certain organizations which engage in transactions of the type described therein. The National Office may issue a ruling as to whether a trust has entered