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SUPPORTING STATEMENT

1. CIRCUMSTANCES NECESSITATING COLLECTION OF INFORMATION

This revenue ruling specifies the criteria to be met in order to automatically reduce an employee’s compensation by a certain amount and have that amount contributed as an elective deferral to an employer’s section 403(b) plan.

2. USE OF DATA

The plan amendment requirement will help ensure that section 403(b) plans continue to satisfy the requirements of the statute and applicable regulations.

The notice requirement is required by the income tax regulations to inform plan participants of their rights under the plan.

3. USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE BURDEN

IRS Publications, Regulations, Notices and Letters are to be electronically enabled on an as practicable basis in accordance with the IRS Reform and Restructuring Act of 1998.

4. EFFORTS TO IDENTIFY DUPLICATION

We have attempted to eliminate duplication within the agency

wherever possible.

5. METHODS TO MINIMIZE BURDEN ON SMALL BUSINESSES OR OTHER SMALL ENTITIES

While the practice described in the revenue ruling may have initially been adopted by large employers, the issuance of the revenue ruling recognizes the burden on small businesses in the adoption and maintenance of section 403(b) plans and provides guidance on how that burden is minimized.

The guidance provided in this revenue ruling should lessen the amount of time that would otherwise be needed if an employer decided to adopt an automatic enrollment feature described in the revenue ruling.

6. CONSEQUENCES OF LESS FREQUENT COLLECTION ON FEDERAL PROGRAMS OR POLICY ACTIVITIES

Not applicable.

7. SPECIAL CIRCUMSTANCES REQUIRING DATA COLLECTION TO BE

INCONSISTENT WITH GUIDELINES IN 5 CFR 1320.5(d)(2)

Not applicable.

8. CONSULTATION WITH INDIVIDUALS OUTSIDE OF THE AGENCY ON

AVAILABILITY OF DATA, FREQUENCY OF COLLECTION, CLARITY

OF INSTRUCTIONS AND FORMS, AND DATA ELEMENTS

Revenue Ruling 2000-35 was published in the Internal Revenue Bulletin on July 31, 2000, 2000-31 IRB 138.

We received no comments during the comment period, in response to the Federal Register notice (71 FR 52372), dated September 5, 2006.

9. EXPLANATION OF DECISION TO PROVIDE ANY PAYMENT OR GIFT TO

RESPONDENTS

Not applicable.

10. ASSURANCE OF CONFIDENTIALITY OF RESPONSES

Submissions for private letter rulings and technical advice under this revenue ruling may be considered tax returns and tax return information that are confidential as required by 26 USC 6103. In general, certain matters relating to taxability and deductibility are disclosable under 26 USC 6110.

11. JUSTIFICATION OF SENSITIVE QUESTIONS

Not applicable.

12. ESTIMATED BURDEN OF INFORMATION COLLECTION

The revenue ruling involves the collection of two types of information.

The fifth, seventh and eighth paragraphs in the section headed “FACTS” and the tenth paragraph in the section headed “LAW AND ANALYSIS” describes a notice that must be given to employees at the time of hire, at the time of plan amendment, and annually thereafter. The notice informs employees that unless they make an affirmative election to have a different amount (including no amount) withheld from their compensation a certain amount will automatically be withheld and deposited on their behalf to the employer’s section 403(b) plan.

We estimate that 100 plans will annually provide the notice described above. The estimated annual burden per respondent is 1 hour, for a total estimated annual burden of 100 hours.

The third paragraph in the section headed “FACTS” describes a plan amendment to take advantage of the guidance provided by this revenue ruling.

We estimate that 100 plans will annually take such action. The estimated annual burden per respondent is 45 minutes for a total estimated annual burden of 75 hours.

Estimates of the annualized cost to respondents for the hour burdens shown are not available at this time.

13. ESTIMATED TOTAL ANNUAL COST BURDEN TO RESPONDENTS

As suggested by OMB, our Federal Register notice dated September 5, 2006, requested public comments on estimates of cost burden that are not captured in the estimates of burden hours, i.e., estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information. However, we did not receive any response from taxpayers on this subject. As a result, estimates of the cost burdens are not available at this time.

14. ESTIMATED ANNUALIZED COST TO THE FEDERAL GOVERNMENT

Not applicable.

15. REASONS FOR CHANGE IN BURDEN

There is no change in the paperwork burden previously approved by OMB.

We are making this submission to renew the OMB approval.

16. PLANS FOR TABULATION, STATISTICAL ANALYSIS AND PUBLICATION

Not applicable.

17. REASONS WHY DISPLAYING THE OMB EXPIRATION DATE IS

INAPPROPRIATE

We believe that displaying the OMB expiration date is inappropriate because it would cause confusion by leading taxpayers to believe that the revenue ruling sunsets as of the expiration date. Taxpayers may not be aware that, if needed, the Service intents to request renewal of the OMB approval and obtain a new expiration date before the old one expires.

18. EXCEPTIONS TO THE CERTIFICATION STATEMENT ON OMB FORM 83-I

Not applicable.

Note: The following paragraph applies to all of the collections of information in this submission:

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. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.

*If emergency approval is needed, please give reason.