Current availability

[Guest dietpepsi]

I think this is a fairly interesting situation. I'm pretty sure I handled this as would be standardly done in the industry but maybe I am all wet. We had a transfer plan that had a match formula based on years of service. Per 1.401(a)(4) regs, non-uniform match is a benefit, right or feature. I performed a current availability test on the match and it failed for several years. The client determined a reasonable business classification to give certain people additional match to make the current availability test pass. We filed VCP since we were outside of the correction period of 9 1/2 months. After several discussions with the IRS agent regarding whether or not the client did an ACP test (they did) and whether or not this was really a demographic failure, the IRS sent the VCP back saying the submission is ineligible under EPCRS. So in the eyes of the IRS, if the match is tested in ACP, no further testing is needed. However, whenever I file these tests on schedule Q for Form 5300, the IRS has never come back saying the testing is not needed or the testing methodology is incorrect.

You would have handled the same as me, yes or no?

Thanks!