Search Blog
Subscribe Today
About this Blog
Welcome to the Snell & Wilmer Benefits Blog. We will be posting about current employee benefits and executive compensation topics and issues. We invite you to contact the authors with your thoughts or questions.Blog Contributors
Topics
Useful Websites
To Err is Human – To Forgive is Up to the IRS in Rev Proc 2019-19
The IRS recently issued its latest version of the Employee Plans Compliance Resolution System (“EPCRS”) in Rev. Proc. 2019-19. The EPCRS is the IRS program that assists employers in correcting both operational and document failures with respect to qualified retirement plans. There are several welcome changes to the new EPCRS, including:
- Certain plan loan failures can now be self-corrected:
- If a participant defaults on a loan, the participant can pay a single sum corrective payment equal to the amount (plus interest) that would have paid to the plan absent the failure and re-amortize the outstanding balance either over the remaining payment schedule or over the maximum allowed period.
Posted in Employee Benefits, Qualified Retirement Plans
| Tagged 2019-19, amendment, EPCRS, operational failure, rev proc 2019-19, self-correction
Share this Article:
IRS Updates Retirement Plan Correction Procedures
On September 28, 2018, the IRS released Revenue Procedure 2018-52. The Revenue Procedure makes changes to the IRS Employee Plans Compliance Resolution System (“EPCRS”), which is the IRS’ comprehensive correction program for qualified retirement plans. The primary purpose of the Revenue Procedure is establishing the process for filing correction applications and paying the applicable user fee through the www.pay.gov website.
Beginning April 1, 2019, the IRS will no longer accept paper applications meaning that plan sponsors are required to use pay.gov to submit their application and pay their user fees. During a transition period running from January 1 – March 31, 2019, plan sponsors may, but are not required to, file their EPCRS applications online. Read More ›
Posted in Qualified Retirement Plans
| Tagged EPCRS, Form 8950, Revenue Procedure 2018-52
Share this Article:
IRS Provides Relief for Correction of Elective Deferral Mistakes in 401(k) Plans
The IRS recently announced changes that make it significantly easier to correct employee deferral mistakes (also known as elective deferrals) in qualified retirement plans. The changes make modifications to the IRS’ Employee Plans Compliance Resolution System (“EPCRS”), which is the IRS’ comprehensive correction program for qualified retirement plans.
Automatic Enrollment Correction Relief
If a qualified plan has automatic enrollment and it either (1) does not automatically enroll employees in accordance with the terms of the plan’s automatic enrollment feature or (2) does not implement an employee’s affirmative election, the new guidance provides that as long as the employee is enrolled in the plan within 9-1/2 months following the end of the plan year of the failure (or earlier if the employee notifies the employer of the mistake), the employer is not required to make a correction for the missed elective deferrals. Read More ›
Posted in Employee Benefits, Qualified Retirement Plans
| Tagged 401(k), 401(k) plan, automatic contribution, automatic enrollment, correction, elective deferral error, EPCRS, qualified retirement plans
Share this Article: