If the IRS and the plan sponsor fail to agree on the correction of the sanction or the amount of the sanction, the IRS will continue to disqualify the plan. The Internal Revenue Service manages the Employee Plan Compliance Resolution System (EPCRS) to allow plan sponsors to correct most non-compliance cases themselves in some way. Most of the time, the prescribed corrective actions will place the participants concerned in the position they were in if the error did not occur. EPCRS supports three core programs The IRS offers many self-correction programs and QPS can help you determine which one fits your situation. Below are links to the most common planning errors and links to the various proposed programs: A plan sponsor that is not forwarded to the IRS but whose pensions face significant problems discovered by the IRS during the review or application process for the letter of inquiry is authorized, as part of the review correction program. , to maintain the tax benefits associated with properly maintained retirement plans. The audit CAP is different from the self-correction program (SCP) and the volutantary correction (VCP) program because it is initiated as a result of the IRS, which finds the (s) qualification defect (s) by a plan audit, not the plan sponsor who finds the error. Plan sponsors may be reluctant to document errors, even if they are corrected corrected under the CPS. However, the documentation of the error and the nature of the correction show that a plan sponsor is capable of detecting and correcting an error in the plan, and it is likely that it will be useful, if necessary, for the independent annual review of the plan and for all IRS audit activities. The IRS has implemented the Employee Plan Compliance Resolution System (EPCRS) as a way for sponsors to take corrective action to avoid the tax consequences of disqualification the plan. One of the three components of EPCRS is the Audit Closing Agreement (Audit CAP).

As part of this program, the sponsor undertakes to correct the qualification error, pay a penalty and sign a conclusion agreement with the IRS.