| SECTION 1. PURPOSE AND OVERVIEW |
| .01 Purpose 1089 |
1089 |
| .02 General principles underlying EPCRS |
1089 |
| .03 Overview |
1090 |
| SECTION 2. EFFECT OF THIS REVENUE PROCEDURE ON PROGRAMS |
| .01 Effect on programs |
1090 |
| .02 Modifications relating to VCP submission procedures |
1090 |
| .03 Description of other modifications |
1092 |
| .04 Future enhancements |
1093 |
| PART II. PROGRAM EFFECT AND ELIGIBILITY |
| SECTION 3. EFFECT OF EPCRS; RELIANCE |
| .01 Effect of EPCRS on retirement plans |
1093 |
| .02 Compliance statement |
1093 |
| .03 Excise and other taxes |
1093 |
| .04 Reliance |
1093 |
| SECTION 4. PROGRAM ELIGIBILITY |
| .01 EPCRS Programs |
1093 |
| .02 Effect of examination |
1094 |
| .03 SCP eligibility requirements relating to plan documents |
1094 |
| .04 Established practices and procedures |
1095 |
| .05 Correction by plan amendment |
1095 |
| .06 Availability of correction for Employer Eligibility Failures and Demographic Failures |
1096 |
| .07 Availability of correction for a terminated plan |
1096 |
| .08 Availability of correction for an Orphan Plan |
1096 |
| .09 Availability of correction for § 457(b) plans |
1097 |
| .10 Egregious failures |
1097 |
| .11 Diversion or misuse of plan assets |
1097 |
| .12 Abusive tax avoidance transactions |
1097 |
| PART III. DEFINITIONS, CORRECTION PRINCIPLES, AND RULES OF GENERAL APPLICABILITY |
| SECTION 5. DEFINITIONS |
| .01 Definitions for Qualified Plans |
1098 |
| .02 Definitions for 403(b) Plans |
1101 |
| .03 Definitions for Orphan Plans |
1103 |
| .04 Earnings |
1103 |
| .05 IRA |
1103 |
| .06 SEP |
1103 |
| .07 SIMPLE IRA Plan |
1103 |
| .08 Under Examination |
1103 |
| SECTION 6. CORRECTION PRINCIPLES AND RULES OF GENERAL APPLICABILITY |
| .01 Correction principles; rules of general applicability |
1104 |
| .02 Correction principles |
1104 |
| .03 Correction of an Employer Eligibility Failure |
1109 |
| .04 Correction of a failure to obtain spousal consent |
1109 |
| .05 Determination letter application not permitted |
1110 |
| .06 Special rules relating to Excess Amounts |
1111 |
| .07 Rules relating to reporting plan loan failures |
1113 |
| .08 Correction under statute or regulations |
1114 |
| .09 Matters subject to excise or other taxes |
1114 |
| .10 Correction for 403(b) Plans |
1115 |
| .11 Correction for SEPs and SIMPLE IRA Plans |
1116 |
| .12 Confidentiality and disclosure |
1117 |
| .13 No effect on other law |
1117 |
| PART IV. SELF-CORRECTION (SCP) |
| SECTION 7. AVAILABILITY OF SCP FOR CERTAIN OPERATIONAL FAILURES AND PLAN DOCUMENT FAILURES |
| .01 In general |
1117 |
| .02 Operational Failures |
1118 |
| .03 Plan Document Failures |
1118 |
| SECTION 8. SELF-CORRECTION OF INSIGNIFICANT OPERATIONAL FAILURES |
| .01 Requirements |
1118 |
| .02 Factors |
1118 |
| .03 Multiple failures |
1118 |
| .04 Examples |
1119 |
| SECTION 9. SELF-CORRECTION OF CERTAIN SIGNIFICANT OPERATIONAL FAILURES AND PLAN DOCUMENT FAILURES |
| .01 Requirements |
1119 |
| .02 Correction period |
1120 |
| .03 Substantial completion of correction |
1120 |
| .04 Examples |
1120 |
| PART V. VOLUNTARY CORRECTION PROGRAM WITH IRS APPROVAL (VCP) |
| SECTION 10. VCP PROCEDURES |
| .01 VCP requirements |
1121 |
| .02 Identification of failures |
1121 |
| .03 Effect of VCP submission on examination |
1121 |
| .04 No concurrent examination activity |
1122 |
| .05 Determination letter applications not related to a VCP submission |
1122 |
| .06 Processing of submission |
1122 |
| .07 Compliance statement |
1124 |
| .08 Effect of compliance statement on examination |
1125 |
| .09 Special rules relating to Anonymous Submissions |
1125 |
| .10 Special rules relating to Group Submissions |
1126 |
| .11 Multiemployer and multiple employer plans |
1127 |
| SECTION 11. SUBMISSION PROCEDURES FOR VCP |
| .01 General rules |
1127 |
| .02 Submission of model forms |
1127 |
| .03 Mandatory submission process using the www.pay.gov website |
1128 |
| .04 PDF file submission contents |
1129 |
| .05 User fee due at the time of VCP submission using the www.pay.gov website |
1131 |
| .06 Additional amount due for Group Submissions |
1131 |
| .07 Additional amounts due for certain submissions. |
1131 |
| .08 Power of attorney requirements |
1131 |
| .09 Acknowledgement of filing |
1132 |
| .10 Maintenance of copies of submission |
1132 |
| .11 Assembling the submission |
1132 |
| SECTION 12. VCP USER FEES |
| .01 User fees |
1133 |
| PART VI. CORRECTION ON AUDIT (AUDIT CAP) |
| SECTION 13. DESCRIPTION OF AUDIT CAP |
| .01 Audit CAP requirements |
1133 |
| .02 Payment of sanction |
1133 |
| .03 Additional requirements |
1133 |
| .04 Failure to reach resolution |
1134 |
| .05 Effect of closing agreement |
1134 |
| .06 Other procedural rules |
1134 |
| SECTION 14. AUDIT CAP SANCTION |
| .01 Determination of sanction |
1134 |
| .02 Factors considered |
1134 |
| .03 Transferred Assets |
1135 |
| .04 Sanction for Nonamender Failures discovered during the determination letter application process |
1135 |
| PART VII. EFFECT ON OTHER DOCUMENTS; EFFECTIVE DATE; PAPERWORK REDUCTION ACT |
| SECTION 15. EFFECT ON OTHER DOCUMENTS |
| SECTION 16. EFFECTIVE DATE |
| SECTION 17. PUBLIC COMMENTS |
| SECTION 18. PAPERWORK REDUCTION ACT DRAFTING INFORMATION |
| APPENDIX A: OPERATIONAL FAILURES AND CORRECTION METHODS |
| .01 General rule |
1137 |
| .02 Failure to properly provide the minimum top-heavy benefit under § 416 to non-key employees |
1138 |
| .03 Failure to satisfy the ADP test set forth in § 401(k)(3), the ACP test set forth in § 401(m)(2), or, for plan years beginning on or before December 31, 2001, the multiple use test of § 401(m)(9) |
1138 |
| .04 Failure to distribute elective deferrals in excess of the § 402(g) limit (in contravention of § 401(a)(30)) |
1139 |
| .05 Exclusion of an eligible employee from all contributions or accruals under the plan for one or more plan years |
1139 |
| .06 Failure to timely pay the minimum distribution required under § 401(a)(9) |
1146 |
| .07 Failure to obtain participant or spousal consent for a distribution subject to the participant and spousal consent rules under §§ 401(a)(11), 411(a)(11), and 417 |
1146 |
| .08 Failure to satisfy the § 415 limits in a defined contribution plan |
1146 |
| .09 Orphan Plans; orphan contracts and other assets |
1147 |
| APPENDIX B: CORRECTION METHODS AND EXAMPLES; EARNINGS ADJUSTMENT METHODS AND EXAMPLES |
| SECTION 1. PURPOSE, ASSUMPTIONS FOR EXAMPLES AND SECTION REFERENCES |
| .01 Purpose |
1148 |
| .02 Assumptions for Examples |
1148 |
| .03 Designated Roth contributions |
1148 |
| .04 Section references |
1148 |
| SECTION 2. CORRECTION METHODS AND EXAMPLES |
| .01 ADP/ACP Failures |
1149 |
| .02 Exclusion of Otherwise Eligible Employees |
1151 |
| .03 Vesting Failures |
1162 |
| .04 § 415 Failures |
1163 |
| .05 Correction of Other Overpayment Failures |
1166 |
| .06 § 401(a)(17) Failures |
1166 |
| .07 Correction by Amendment |
1166 |
| SECTION 3. EARNINGS ADJUSTMENT METHODS AND EXAMPLES |
| .01 Earnings Adjustment Methods |
1168 |
| .02 Examples |
1170 |