PURPOSE
This transmits complete reprint with changes for IRM 4.72.2, Employee Plans Technical Guidance, Cash or
Deferred Arrangements (CODAs).
BACKGROUND
IRM text pertaining to IRM 7.7.1, Chapter 2 (formerly, IRM 7(10)54:440) has been reorganized and
renumbered as IRM 4.72.2. This IRM material reflects the new simplified format and style.
NATURE OF CHANGES
This IRM text provides guidance for examiners on cash or deferred arrangements (CODAs) for plan years
beginning after December 31, 1996. This transmittal reissues existing procedures, updates the text for law
changes, and reorganizes the material. This material replaces and obsoletes text currently contained in the
following IRM sections: IRM 7.7.1, Chapter 2 (formerly, IRM 7(10)54:440), using the same catalog number.
INTENDED AUDIENCE
TEGE (Employee Plans)
Carol Gold
Director, Employee Plans
Tax Exempt and Government Entities
MANUAL
TRANSMITTAL
Department
of the
Treasury
Internal
Revenue
Service
4.72.2
MARCH 1, 2002
4.72.2 (03-01-2002)
IR Manual
Cat. No. 35951M
Distribution: IRM 4.72.2
4.72.2
Cash or Deferred Arrangements (CODAs)
4.72.2.1
Overview of Section 2
4.72.2.2
Overview of CODAs
4.72.2.2.1
Recent Changes to CODAs
4.72.2.3
Eligible Employer and Plan
4.72.2.4
Common Abbreviations
4.72.2.5
CODA Defined
4.72.2.5.1
Cash or Deferred Election
4.72.2.5.2
Certain One-Time Elections
4.72.2.5.3
Partnership Rules
4.72.2.5.4
Qualified CODAs
4.72.2.5.5
Nonqualified CODAs
4.72.2.5.6
Examination Steps
4.72.2.6
Coverage and Participation
4.72.2.6.1
Examples
4.72.2.6.2
Examination Steps
4.72.2.7
Contribution Limitation
4.72.2.7.1
Example
4.72.2.7.2
Examination Steps
4.72.2.8
Restricted Distributions
4.72.2.8.1
Plan Termination
4.72.2.8.2
Sale of Subsidiary/Assets
4.72.2.8.3
Hardship Distribution
4.72.2.8.3.1
General Hardship Distribution Standards
4.72.2.8.3.2
Deemed Hardship Distribution Standards
4.72.2.8.4
Example
4.72.2.8.5
Examination Steps
4.72.2.9
Nonforfeitability
4.72.2.9.1
Examination Steps
4.72.2.10
CODA Nondiscrimination
4.72.2.10.1
ADP Test
4.72.2.10.1.1
Cu