SECTION 2. EFFECT OF THIS

REVENUE PROCEDURE ON PROGRAMS

.01 Effect on programs . This revenue procedure modifies and supersedes Rev. Proc. 2001–17, 2001–1 C.B. 589, which was the prior consolidated statement of the correction programs under EPCRS. The modifications to Rev. Proc. 2001–17 that are reflected in this revenue procedure include:

• extending the duration of the selfcorrection period under SCP for significant operational compliance failures where the Plan Sponsor assumes a plan in connection with a corporate merger, acquisition, or other transaction. (section 9.02(2))

• extending the Anonymous Submission Procedure indefinitely. (section 10.13(3))

• expanding the Anonymous Submission Procedure to permit the submission of failures listed in Appendix A and Appendix B. (section 10.13(1))

• expanding the Anonymous Submission Procedure to VCGroup and VCSEP submissions. (section 10.13(1))

• expanding the definition of Employer Eligibility Failure to include the adoption of a 401(k) plan by any ineligible employer. (section 5.01(2)(d))

• broadening the VCGroup procedures to permit eligible organizations to submit operational and plan document failures in a single submission. (section 10.15(1))

• increasing the de minimis amount relating to corrective distributions. (section 6.02(5)(b))

• providing a de minimis rule for correcting certain Overpayments. (section 6.02(5)(c))

• clarifying the date by which correction of a failure related to Transferred Assets must be completed. (section 12.08)

• clarifying that the correction of failures in a terminated plan may be made under VCP. (section 10.03)

• clarifying what items may be excluded from the initial submission under the Anonymous Submission Procedure. (section 10.13(1))

• updating the definition of Favorable Letter. (section 5.01(4))

• modifying the correction procedure relating to Excess Amounts under VCT and overcontributions under VCSEP. (sections 12.05(3) and 12.07(2))

• clarifying the factors considered under Audit CAP for determining a sanction amount. (section 14.02)

• revising the checklist in Appendix C to include questions relating to Transferred Assets and the waiver of the excise tax under § 4974. (Appendix C items 10 and 18) In addition, the following sections have been modified for purposes of clarification: sections 4.05, 5.01(8), 5.02(3), 6.02(3), 6.02(5)(d), 6.05(1), 6.05(2)(a) and (b), 9.05 Example 1, 10.06, 10.09, 10.13(2), 10.15(2), 10.15(3)(b), 11.01, 11.02(11), 11.03(4), 11.04(3), 11.04(4), 11.05, 11.12, 12.01(1), 12.01(3)(a), 12.02, 12.08, 13.02, 14.03, 15, 16, 17, Appendix A .05, Appendix B 2.01(b)(i) and 2.07(3), and Appendix C checklist item 26.

.02 Future enhancements . (1) It is expected that the EPCRS revenue procedure will continue to be updated on a periodic basis, including, as noted above, further improvements to EPCRS based on comments previously received. In addition, the Service and Treasury continue to invite further comments on how to improve EPCRS. Comments should be sent to:

Internal Revenue Service Attention: T:EP:RA:VC 1111 Constitution Avenue, NW Washington, D.C. 20224

(2) The Service and Treasury are considering expanding the procedures under EPCRS and are interested in receiving comments regarding, among other things, appropriate correction procedures for failures arising under SIMPLE IRAs (under § 408(p)) and § 457(b) plans. Submissions related to SIMPLE IRAs are currently being accepted by the Service on a provisional basis outside of EPCRS. Submissions relating to § 457(b) eligible governmental plans will be accepted by the Service on a provisional basis outside of EPCRS. Submissions relating to other § 457(b) eligible plans may be accepted outside EPCRS as

Employee Plans develops experience in the § 457 area.