Vfcp online calculator8/10/2023 ![]() ![]() Of course, certain instances may cause a lag outside of the administrative pattern that may be deemed “as soon as possible.” Examples may include: a payroll employee is sick and can’t process the deposit as quickly as normal, there is a power outage or computer software malfunction and systems can’t process payroll as quickly as normal, there is a change in service providers and there is a lag in the new custodian being able to receive the deposits, etc. Hence, plan sponsors can withhold salary deferrals and deposit that money to the trust within one day, then any lag outside of that time frame could be considered a late deposit. Unofficial guidance emphasizes that patterns of deposit will be analyzed on a case by case basis to determine what “timely” means to each employer. In fact, the official requirement for large plans is that a plan sponsor must deposit deferrals to the trust as soon as the assets can be segregated from the employer’s funds, but in no event can the deposit be later than the 15th business day of the month following the month of withholding. Unfortunately, unlike the seven-day safe harbor provided for small plans, the DOL doesn’t specify a black and white safe harbor deposit time frame with universal applicability to all large plans. In this blog, I will discuss the rules regarding the timely deposit of salary deferral withholdings, when a timely deposit doesn’t occur, the steps the plan sponsor must take for each of the available correction options. When employee deferrals are not deposited timely, there are two available correction avenues: self-correction or completing a filing through the DOL’s Voluntary Fiduciary Correction Program (VFCP). Late deposits of employee 401(k) and 403(b) deferrals continue to be a common error we find while performing plan financial statement audits, which is consistent with the top ten list of mistakes the Internal Revenue Service (IRS) and Department of Labor (DOL) identify during their audits and investigations. Additional details regarding this Notice will be discussed in my next blog to be posted shortly. In this notice, the EBSA provides relief to plan sponsors regarding the possibility of lags in deposits due to the recent COVID-19 issues which was addressed in my blog below. On Wednesday, Apthe Employee Benefits Security Administration (EBSA) also posted a Disaster Relief Notice 2020-01. ![]() You are not required to respond to a collection of information unless it displays a currently valid OMB Control Number.Posted by Christopher J. This collection of information is currently approved under OMB Control Number 1210-0118. EBSA estimates that assembling and submitting this information will require an average of 6 to 8 hours. EBSA will use this information to determine whether you have satisfied the requirements of the Program. You are not required to use this form however, you must supply the information identified in order to receive the relief offered under the Program with respect to a breach of fiduciary responsibility under Part 4 of Title I of ERISA. Department of Labor's Employee Benefits Security Administration (EBSA). The information identified on this form is required for a valid application for the Voluntary Fiduciary Correction Program of the U.S. ![]() For full application procedures, consult Paperwork Reduction Act Notice Submit your application to the appropriate EBSA field office. Please make sure you include the required VFCP Checklist and all supporting documents identified on the checklist (for example, proof of payment). This application form provides a recommended format for your Voluntary Fiduciary Correction Program (VFCP) application. Printer Friendly Version | MS Word Fill-In Form Version ![]()
0 Comments
Leave a Reply.AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |