The programs include:
- The Voluntary Fiduciary Correction Program that allows companies to correct any ERISA violations, make up any plan losses with interest, and distribute any supplemental benefits due participants and beneficiaries – all on their own. DoL officials said they would then issue a “no action” letter indicating they won’t take enforcement measures.
- As a companion step, the DoL announced that the IRS has agreed not to impose excise taxes on four prohibited transactions fixed through the new voluntarily compliance program. The DoL said the new IRS policy is effective immediately – even as the DoL takes public comments on it.
- The DoL also announced that it has updated its Delinquent Filer Voluntary Correction Progam, started in 1995, by substantially cutting the penalties for late Form 5500 filing and by making the program easier to use.
“Voluntary compliance with the law benefits both workers and employers,” said Ann Combs, Assistant Secretary of Labor, in the announcement. “Employers will have an incentive to bring their plans into compliance if they can avoid enforcement actions, civil monetary penalties, and prohibited transaction excise taxes. Workers’ retirement security is enhanced when plans are brought into compliance and assets are restored,” she added.