Does late amender fix a botched EGTRRA restatement?

[Flyboyjohn]

Plan has been safe harbor since 2003 and plan documents prior to EGTRRA restatement were correctly prepared.

Bundled provider botched EGTRRA restatement and didn't check all the correct boxes for safe harbor status. Interestingly the provider administered the plan "as if" it was safe harbor until they discovered document error early in 2013.

What is the best way to fix the document problem? Can we prepare a "correct" EGTRRA restatement now and submit as a late amender under VCP? Seems like being late would be better than being wrong.

Thanks.

[Lou S.]

Last I checked IRS still does not recognize scriveners error except in very limited circumstances.

You can try your method under EPCRS but the IRS may propose running the ADP (and possibly ACP) tests for each year and making corrections under EPCRS if necessary.

[Kevin C]

From your description, it sounds like an operational failure to me, not a document failure. Rev. Proc. 2013-12, Section 4.05(1) looks like what you want to do.

.05 Correction by plan amendment. (1) Availability of correction by plan amendment in VCP and Audit CAP. A Plan Sponsor may use VCP and Audit CAP for a Qualified Plan or 403(b) Plan to correct Plan Document, Demographic, and Operational Failures by a plan amendment, including correcting an Operational Failure by a plan amendment to conform the terms of the plan to the plan's prior operations, provided that the amendment complies with the applicable Code requirements, including, for a Qualified Plan, §401(a) (including the requirements of §§401(a)(4), 410(b), and 411(d)(6)). In addition, a Plan Sponsor may adopt a plan amendment to reflect the corrective action. For example, if the plan failed to satisfy the actual deferral percentage (ADP) test required under §401(k)(3) and the Plan Sponsor must make qualified nonelective contributions not already provided for under the plan, the plan may be amended to provide for qualified nonelective contributions. Except as provided in section 6.05, the issuance of a compliance statement does not constitute a determination as to the effect of any plan amendment on the qualification of the plan.

If you are concerned about the IRS approving the correction you want, a John Doe filing might be the way to go.