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Not a Church Plan. Now what?


elmobob14

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So, if I've been sponsoring a church plan and upon review determine that I'm not eligible for church plan status am I able to use EPCRS to fix it retroactively? I assume I would also need past 5500s and plan audits? If anyone has experience with this, and in particular, with how the IRS responded to someone applying to correct under EPCRS, please share. Thanks!

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What kind of plan is it? DB or DC?

Why did you think you were a church plan and what makes you now think you are not a church plan? Did anyone work with you on this determination?

How many people are in the plan?

The material provided and the opinions expressed in this post are for general informational purposes only and should not be used or relied upon as the basis for any action or inaction. You should obtain appropriate tax, legal, or other professional advice.

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It's a 403(b) DC plan. The connections that the organization once had with a church were severed long ago, but no one thought about the impact of this separation on the plan. It's clear that it doesn't qualify for church plan status anymore. It has 100+ participants.

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If it's a non-ERISA 403(b) plan (which it may be -- you'll have to review the rules on employer involvement) then there's no 5500 requirement. Also check out FAB 2009-02. I can't comment on using EPCRS to fix an issue -- I've not done it in an instance like this. Good luck.

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