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Compliance March 29, 2011
403(b) Errors Ineligible for IRS Voluntary Correction Program
March 29, 2011 (PLANSPONSOR.com) – The Internal Revenue Service said recently, it has received several Voluntary Correction Program submissions for 403(b) retirement plan failures that are currently ineligible for correction through VCP.
Reported by
Rebecca Moore
Ineligible submissions include cases where:
- the plan’s written program did not satisfy the legal requirements under Code §403(b) and the 403(b) final regulations, or the plan failed to adopt a written plan program before December 31, 2009; or
- the plan failed to operate according to its written program’s terms.
The agency said it will return all VCP submissions (including fees) containing ineligible failures.
An employer sponsoring a 403(b) plan may currently use VCP to correct employer eligibility and demographic failures, and the operational failures listed in Revenue Procedure 2008-50 §5.02(2)(a). The IRS said it is in the process of updating Revenue Procedure 2008-50 to expand EPCRS to include post-December 31, 2008 failures.You Might Also Like:
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