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The IRS has updated the Employee Plans Compliance Resolution System (EPCRS), giving sponsors of defined benefit and defined contribution plans more time to self-correct operational errors. The new rules take effect Jan. 1, 2009, but sponsors may apply them after Sept. 2, 2008.
The period for self-correcting operational errors under EPCRS still ends on the last day of the second plan year after the plan year of the failure. But the IRS has relaxed the deadline for employers that have substantially completed the correction process by the last day of the correction period.
A correction will be considered substantially complete if: (1) the correction has been ongoing during the two-plan-year period and will be complete within 120 days of the end of the correction period, or (2) the sponsor has completed the correction for 65 percent of affected participants by the end of the correction period.
The IRS is also seeking public feedback on the system’s Self-Correction Program (SCP). IRS Employee Plans is conducting a short, anonymous survey designed to gauge the relevance and usefulness of the SCP. The survey should take less than five minutes to complete. To participate, go to:
http://guest.cvent.com/SURVEYS/Welcome.aspx?s=d8a22d3a-6c3b-4d17-a0dc-0ac8081fde8d.
October 2008
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