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I guess by 'savvy' it means you will contact the original poster, to maximize 'his' business. note how there was no attempt to even point out any differences/similarities between a rollover and transfer.

With all of the plan expenses already paid, this may provide some help: http://www.dol.gov/ebsa/regs/fab_2006-1.html The last paragraph before the Conclusion section reads:

Agreed, not a legitimate termination of employment. Never any intent of the parties involved to terminate the employment relationship.

I guess there can be differences of opinions as to what "administratively feasible" means. I think if the VCP filing could result in a DECREASE of the participant's account balance, there may an issue of "protecting plan assets" and the known difficulty of trying to get overpayments returned. But if the VCP filing could only INCREASE the participant's balance, then what is the impediment to a secondary distribution? An initial distribution of a known balance is easy. A secondary distribution of a corrective contributions is likewise "easy." Last I checked, the "cost" of doing a secondary distribution is irrelevant in the decision. If it was the plan sponsor's error, it is the plan sponsor's burden to make it right. The "best" approach (IMHO) is to follow normal plan procedures and precedence in processing the distribution, and if necessary, make a secondary distribution AFTER the VCP correction has been made - especially if that determination may be months, if not many months into the future.

If the goal is to provide the annual notices to everybody who is supposed to get them without having to keep track of who is not yet eligible for the plan, then send the notices to everyone with the anti-confusion memo every year and also provide the notices to the new enrollees as part of their pre-enrollment document package. That should cover all the bases and anything else that needs covering.

Would failure to pay the account out (if called for by the plan) create another error subject to VCP? If the VCP (when approved) requires that the employer pay more in, would there be a problem with paying out the new piece after the existing account is paid?

To reduce confusion, you could include a cover memo that says something like: The attached notices apply to employees who are eligible to participate in the ABC Plan. You become eligible to participate in the ABC Plan when you reach ... and have ...