khn Posted September 24, 2013 Posted September 24, 2013 The plan's auditor has found that bonus is included in total comp and our client has failed to withhold on bonus for the past 10 years. I'm assuming they will have to file VCP. The issue is they don't have records of participant's actual deferrals going back that far. What would be an acceptable correction? And would they have to hire an Erisa attorney to help calculate and file?
khn Posted October 3, 2013 Author Posted October 3, 2013 An update if anyone is interested...the plan's erisa attorney is planning to file for VCP and file a retroactive amendment to exclude bonus from the definition of comp. Hopefully it will be accepted.
Belgarath Posted October 3, 2013 Posted October 3, 2013 I'm sure it will be many months before there is an answer to this, but I'll be fascinated to see if the IRS accepts this as a correction. Thanks in advance for passing it along once known.
BG5150 Posted October 3, 2013 Posted October 3, 2013 will 414(s) have been satisfied for all those years? QKA, QPA, CPC, ERPATwo wrongs don't make a right, but three rights make a left.
khn Posted October 3, 2013 Author Posted October 3, 2013 I would think the tests will need to be performed but we'll see what transpires. Even so, it's better than the alternative, i.e., having to do qnec and match which for this plan would probably be six figures.
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