Surety Letter

Surety Letter

Rev. Proc. 2016-33, section 2.04(1)
.4 Proof of bond.
(1) Surety letter. With its application, a CPEO applicant must submit a signed letter from a qualified surety confirming that the surety agrees to issue a bond to the CPEO applicant if and when it is certified as a CPEO (a “surety letter”). The surety letter must also state that the surety agrees to issue a bond in the amount required by § 301.7705-2T(g)(2) and pursuant to the terms set forth in Form 14751, Certified Professional Employer Organization Surety Bond. If a CPEO applicant is a member of a controlled group of which other members are CPEO applicants or CPEOs, the surety letter must also contain the name and EIN of each CPEO applicant and each CPEO that is or will be covered by the bond. All CPEO members of a controlled group are required to be on the same bond in the amount required by § 301.7705-2T(g)(2), applied as if all such CPEO members (and/or any of their precursor entities, if applicable) were one organization.