Correcting Plan Defects

Running a business and overseeing your company’s retirement plan may be a big challenge, and problems in the plan can creep in. Maybe someone who should be allowed to participate has been prevented from doing so; maybe you failed to deposit employees’ contributions within the required period; or maybe you did not update your plan documents. The IRS’s Employee Plans Corrections Resolution System (EPCRS) can be used to correct defects and problems with little or no penalty. Find details at www.irs.gov and search “correcting plan errors.” It is best to work with a tax professional to use the proper correction option.