COMMENT LETTER IRS 402 11 19 2007

November 20, 2007 CC:PA:LPD:PR (REG 148393-06) Internal Revenue Service P.O. Box 7604 Ben Franklin Station Room 5203 Washington, D.C. 20044 Re: Comments on Proposed Regulations – Accident and Health Benefits Under Qualified Plans Dear Sirs and Mesdames: The American Benefits Council (the Council) appreciates the opportunity to comment on the proposed regulations (72 Fed. Reg. 46421, Aug. 20, 2007,) and supports the need to clarify the tax treatment of accident and health insurance under qualified retirement plans. The Council is a public policy organization representing principally Fortune 500 companies and other organizations that assist employers of all sizes in providing benefits to employees. Collectively, the Council’s members either sponsor directly or provide services to retirement and health plans that cover more than 100 million Americans. With regard to the proposed regulations, we are concerned that they could affect a wide variety of common practices that our members use to provide and protect on a nondiscriminatory basis the qualified retirement plan income of disabled employees. These practices include: • the provision of continued employer-funded defined benefit pension accruals for employees on long-term disability, • the provision of continued defined contribution plan accruals for employees on long-term disability – with funding from employer contributions, the purchase of a special long-term disability policy designed ...