Belgarath Posted March 17 Report Share Posted March 17 Any opinions as to whether the SECURE 2.0 Section 305 will prompt the IRS to allow self-correction of scrivener errors? I'm guessing not, but it sure would be nice. For example (just saw this recently) safe harbor 3% nonelective, with an additional PS discretionary, was amended in 2021, mid year, to exclude a category of compensation for PS allocation purposes. Since 1,000 hour/last day for the PS, no problem. Problem is that on the AA amendment, wrong box was checked - instead of checking the box to carve this out to exclude for PS purposes only for 2021, it was checked to exclude for all purposes. Clearly unintended, client made the appropriate safe harbor contribution for 2021, etc. Now, technically this amendment appears to violate 1.401(k)-3(g), and would cause the plan to require ADP testing for 2021, etc. - a pretty harsh outcome. So a VCP filing appears to be required to correct this. Allowing as a Scrivener error would be much nicer. To be fair, I can see why the IRS generally is leery about allowing self correction for Scrivener error, as it might allow some pretty creative "revisionist history" on plans which isn't justified. So I'm guessing this won't change. Opinions? Link to comment Share on other sites More sharing options...
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