Notice 2018-81

Part III. Administrative, Procedural, and Miscellaneous
Notice Regarding Certain
Church Plan Clarifications
under Section 336 of the
PATH Act
Notice 2018 – 81
I. PURPOSE
This notice describes the manner in
which taxpayers notify the Internal Revenue Service (IRS) of revocation of an
election to aggregate or disaggregate certain church-related organizations from
treatment as a single employer under section 414(c)(2)(C) and (D). Churches and
church-related organizations are allowed
to make elections to aggregate or disaggregate for this purpose under section
414(c)(2)(C) and (D), which were added
to the Code by section 336(a) of the Protecting Americans from Tax Hikes Act of
2015 (Public Law 114 –113 (129 Stat.
2242 (2015)) (PATH Act). This notice
also requests comments with respect to
potential guidance on certain other issues
raised by PATH Act provisions related to
church plans.
II. BACKGROUND
Section 414(c) generally provides that
employees of employers that are members
of a group under common control are
treated as employed by a single employer.
Section 414(c) is used in determining,
among other requirements, whether a retirement plan complies with applicable
nondiscrimination requirements. Section
336(a) of the PATH Act amended section
414(c) by adding a new section 414(c)(2).
Under section 414(c)(2)(C) and (D), an
election may be made to aggregate or disaggregate certain church-related organizations, respectively, for purposes of treatment as a single employer under section
414(c). Under these provisions, the “election, once made, shall apply to all succeeding plan years unless revoked with
notice provided to the Secretary in such
manner as the Secretary shall prescribe.”
However, the provisions do not require
that the Secretary be notified of any election under section 414(c)(2).

October 22, 2018

III. PROVIDING NOTICE OF
REVOCATION OF ELECTION TO
AGGREGATE OR DISAGGREGATE
The PATH Act does not prescribe specific rules for making or revoking elections under section 414(c)(2)(C) or (D),
other than requiring that the IRS be notified of the revocation of an election.
Therefore, for purposes of section 414(c)
(2)(C) and (D), the generally applicable
substantiation and recordkeeping requirements of section 6001, including requirements described in Rev. Proc. 98 –25
(1998 –1 CB 689), apply. Accordingly, to
satisfy the statutory requirement that notice be provided to the IRS if an election
made under section 414(c)(2)(C) or (D) is
subsequently revoked, the entity authorized to revoke the election must provide a
copy of the revocation upon request by the
IRS.
IV. EFFECTIVE DATE
This notice is effective for revocations
of elections under section 414(c)(2)(C) or
(D) made on or after October 22, 2018.
Before October 22, 2018, any reasonable
method of notifying the Secretary regarding revocations of elections under section
414(c)(2)(C) or (D) is acceptable, including the generally applicable substantiation
and recordkeeping requirements of section 6001 that would satisfy Section III of
this notice.
V. COMMENTS REQUESTED
REGARDING POTENTIAL
ADDITIONAL GUIDANCE
The Department of the Treasury and the
IRS request comments on whether additional guidance under section 336 of the
PATH Act would be helpful. Send submissions to CC:PA:LPD:PR, (Notice 2018 –
81), Room 5203, Internal Revenue Service,
PO Box 7604, Ben Franklin Station, Washington, D.C. 20044. Comments may also be
hand delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to:
Internal Revenue Service, CC:PA:LPD:PR,
(Notice 2018 – 81), Courier’s Desk, Internal
Revenue Service, 1111 Constitution Avenue,
N.W., Washington DC. Alternatively, comments may be submitted via the Internet at

666

notice.comments@irscounsel.treas.gov
(Notice 2018 – 81). Please submit written comments by December 21, 2018.
All comments will be available for public inspection.
VI. PAPERWORK REDUCTION
ACT
The collection of information contained in this notice has been reviewed
and approved by the Office of Management and Budget in accordance with the
Paperwork Reduction Act (44 U.S.C.
3507) under control number 1545-2279.
An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays
a valid OMB control number.
The collection of information in this
notice is in section III. This information
is required to revoke an election to aggregate or disaggregate certain organizations under section 414(c)(2)(C) or
(D). The collection of information is
mandatory if such an election is revoked. The likely respondents are sponsors of church plans.
The estimated total annual reporting
burden is 6.1 hours. The estimated annual
burden per respondent is approximately 2
hours. The estimated number of respondents is 31. The estimated annual frequency of responses is 3.
Books or records relating to a collection of information must be retained as
long as their contents may become relevant to the administration of any internal
revenue law. Generally, tax returns and
tax return information are confidential, as
required by section 6103.
VII. DRAFTING INFORMATION
The principal author of this notice is
Jeremy D. Lamb of the Office of Associate Chief Counsel (Tax Exempt and Government Entities). For further information
regarding this notice, contact Mr. Lamb at
(202) 317-6799 (not a toll-free number).

Bulletin No. 2018 – 43