Archived Insight | March 26, 2019

IRS Reminds Plans of Deadline for Electronic Filing Changes

Beginning April 1, 2019, plan submissions for the Internal Revenue Service’s (IRS) Voluntary Compliance Program (VCP) must be made electronically through www.pay.gov. The IRS will not accept paper submissions postmarked after March 31, 2019.

The IRS first announced this change in Revenue Procedure 2018-52, which made otherwise minor changes in the IRS’s Employee Plan Compliance Resolution System (EPCRS). Employee Plan News, dated March 14, 2019, reminds plans of this change and provides some electronic filing tips. A video explaining how to make a VCP submission using www.pay.gov is on the IRS website.

The VCP Program

The VCP program is one element of EPCRS. Under VCP, plans may apply to correct mistakes that could otherwise result in plan disqualification. Rev. Proc. 2018-52 sets forth what information is needed for specific mistakes and the appropriate correction. If the submission satisfies the VCP conditions, the IRS issues the plan a compliance letter, and the plan must take the agreed upon compliance steps.

Possibility of Additional Changes

In an earlier version of EPCRS, Rev. Proc 2015-27, the IRS invited comments on the issue of correcting plan overpayments. In the current version, Rev. Proc. 2018-52, it notes that it has received and reviewed comments on the subject and is in the process of developing further modifications to the overpayment correction rules.

The IRS also notes that it has received and is reviewing comments on expanding EPCRS’s self-correction program so that plans would be able to self-correct (i.e., would not have to submit applications and pay fees to correct) additional types of errors.

No information about when either set of changes might be implemented has yet been provided.

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This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.

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