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RatherBeGolfing

IRS expands self correction to certain loan failures

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"Beginning April 19, 2019 ... SCP is available to correct certain plan loan failures.... Reporting of deemed distributions ... Plan loan statutory failures.... Failure to obtain spousal consent for a plan loan.... Expanding SCP to correct certain plan loan failures by plan amendment.... [T]he Treasury Department and the IRS received comments on permitting the correction of Overpayments under SCP, and are currently developing guidance on these issues."

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The Department of Labor’s Voluntary Fiduciary Correction Program (VFC Program), at 71 FR 20262, provides for a no-action letter for a defaulted loan failure corrected under VCP, provided the conditions of the VFC Program are met. Such noaction letters are conditioned under section 7.3(b) of that program on the inclusion of a VCP compliance statement, among other things. The Department of Labor has advised the IRS that it will not issue a no-action letter under section 7.3(b) of its VFC Program unless such failures are corrected under VCP.

Looks like we still need to keep the pressure on the DOL...

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13 minutes ago, RatherBeGolfing said:

Looks like we still need to keep the pressure on the DOL...

… and maybe learn from administrative mistakes, to minimize them in the future.

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1 hour ago, david rigby said:

… and maybe learn from administrative mistakes, to minimize them in the future.

Absolutely, but VCP for a simple loan fix just adds to the VCP backup. 

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