EPCRS

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On December 29, 2022, President Biden signed the Consolidated Appropriations Act, 2023, and Division T of the Act contains legislation dubbed the SECURE 2.0 Act of 2022 (SECURE 2.0).  SECURE 2.0 contains an important provision regarding the eligibility of part-time employees to participate in an employer’s 401(k) plan or ERISA-governed 403(b) plan. The fundamental principle…

For the many employers that use a pre-approved 401(k) plan (or another type of defined contribution plan), the deadline to execute a restatement of the plan was July 31, 2022.  An employer that missed the deadline will need to (i) review whether a correction will be required to maintain the plan’s favorable tax status and…

On March 29, 2022, the House of Representatives passed the Securing a Strong Retirement Act of 2022 (“SECURE 2.0”, HR 2954).  The vote was largely supported by both parties (414-5).  The Senate will likely act on the bill later this spring.  While we expect several changes in the Senate version, it is widely…

Every few years, the IRS enhances its popular correction program for qualified retirement plans (the Employee Plans Compliance Resolution System, or EPCRS) to continue to encourage plan sponsors to correct any plan failures and bring their plans into compliance.  Revenue Procedure 2021-30 reflects this latest enhancement of IRS correction guidance.  Here is a summary of…

On May 28, 2020, the Internal Revenue Service (IRS) released an advanced version of Notice 2020-35, which amplifies the relief it had previously provided from deadlines for certain time-sensitive actions.  The relief offered by Notice 2020-35 is provided because of the ongoing COVID-19 pandemic and is in addition to the relief provided by Notice…

Long on the wish list of practitioners and plan sponsors alike, self-correction of certain common plan document issues and loan failures is finally an option under the Internal Revenue Service’s Employee Plans Compliance Resolution System (“EPCRS”), newly minted via Rev. Proc. 2019-19.

It is no secret that the IRS is continually dealing with reduced…

In 2008, the IRS established a voluntary correction program aimed at plan sponsors and administrators to encourage resolution of plan document or operational failures as soon as they are discovered. The Employee Plans Compliance Resolution System, or “EPCRS” as it is most often called, stresses the importance of established administrative practices and procedures to avoid…

In the spirit of the holidays, the Internal Revenue Service gave a gift to sponsors of 403(b) tax-deferred annuity plans on December 4, 2018, by issuing IRS Notice 2018-95.  For plan sponsors that exclude part-time employees from their 403(b) plans, this gift provides a 10-year nod on their historical plan administration, despite noncompliance with…

Occasionally qualified plan administrators discover that their plans have incurred an operational error.  The Internal Revenue Service (“IRS”) recognizes that it needs the help of plan administrators to police the administration of qualified plans and has correspondingly published guidance to help plan administrators take appropriate corrective action where necessary.

IRS Correction Alternatives

Revenue Procedure 2016-51…

Benefit plan practitioners returned to their desks after the holidays to the surprising news that the Internal Revenue Service issued guidance that made sweeping changes to the user fees for the Internal Revenue Service’s Voluntary Correction Program (“VCP”).  (And notably more than one IRS agent has informally indicated they were surprised by the changes, which…