Notifying Participants of Additional Contributions made pursuant to EPCRS

[mariemonroe]

VCP is complete, compliance statement is signed, and employer has made an additional contribution to the plan as required.

Participants are now starting to ask questions along the lines of: what is this extra money doing in my account?

Can anyone tell me of a short simple way to inform participants of why the contribution has been made, without going into too many unnecessary details? Does anyone have a reference to a notice of this type?

[masteff]

The core of the message is roughly:

The rules and regulations for qualifed retirement plans are very complex. These can sometimes result in companies having to make small additional contributions to (some) participants' accounts. This is a one-time occurance and was done in a fair and consistent manner.

If it didn't effect everyone:

Only some participants are effected by this, so not everyone should expect to see the additional amount in their transaction history.

I'm waffling on something along the lines of:

The amount received by each affected participant may vary because it is based on factors such as eligible compensation {or "amount invested in mutual fund abc" or "loan fees paid during the year" or other factor relevant to your VCP}. {this anticipates people comparing numbers and griping about it.}

[Guest Sieve]

And I think I would add that correction was as per IRS procedures and was approved by the IRS.