SECTION 11. APPLICATION

PROCEDURES FOR VCP

.01 General rules . The requirements of this section 11 are satisfied if the request for a compliance statement from the Service under VCP satisfies the informational and other requirements of this section 11. In general, a request under VCP consists of a letter from the Plan Sponsor (which may be a letter from the Plan Sponsor’s representative) or Eligible Organization (or representative) to the Service that contains a description of the failures, a description of the proposed methods of correction, and other procedural items set forth in this section 11. Appendix D and Appendix F of this revenue procedure are provided to assist the applicant in satisfying these requirements. Applicants are encouraged to use Appendix D or Appendix F, as applicable. If the Streamlined Application procedures described in section 11.02 are used, the applicant should use Appendix F and related schedules; otherwise, the application should be made in accordance with the provisions of section 11.03, using the format outlined in Appendix D.

The Appendix D and Appendix F formats for the application should not be modified. Also, since the application may form part of a document that is executed by the Service, the application itself (as distinguished from any cover letter or other supplemental letters that the applicant may provide) should not be submitted under the letterhead of the Plan Sponsor or the Plan Sponsor’s authorized representative. The application also contains an Enforcement Resolution section (Part VII of Appendix D and Part IV of Appendix F). The applicant should complete only Parts I through VI, and Parts I through III, of Appendix D and Appendix F, respectively. The Enforcement Resolution (Part VII of Appendix D and Part IV of Appendix F) may only be completed by the Service. The application must include the Enforcement Resolution section. If the application is acceptable as submitted, the Service may execute the Enforcement Resolution page to indicate its approval of the submission. In such a situation, the executed Enforcement Resolution will be

Organization is not eligible to make a Group Submission unless the failures in their submission result from a systemic error involving the Eligible Organization that affects at least 20 plans and that result in at least 20 plans implementing correction. If, at any time before the Service issues the compliance statement, the number of plans falls below 20, the Eligible Organization must notify the Service that it is no longer eligible to make a Group Submission (and the compliance fee may be retained).

(3) Special Group Submission proce- dures . (a) In general, a Group Submission is subject to the same procedures as any VCP submission in accordance with sections 10 and 11, except that the Eligible Organization is responsible for performing the procedural obligations imposed on the Plan Sponsor under sections 10 and 11. See section 11.02(15) for a special submission requirement with respect to Group Submissions.

(b) The Eligible Organization must provide notice to all Plan Sponsors of the plans included in the Group Submission. The notice must be provided at least 90 days before the Eligible Organization provides the Service with the information required in section 10.11(3)(c). The purpose of the notice is to provide each Plan Sponsor with information relating to the Group Submission request. The notice should explain the reason for the Group Submission and inform the Plan Sponsor that the Plan Sponsor’s plan will be included in the Group Submission unless the Plan Sponsor responds within the 90-day period to exclude the Plan Sponsor’s plan from the Group Submission.

(c) When an Eligible Organization receives an unsigned compliance statement on the proposed correction and agrees to the terms of the compliance statement, the Eligible Organization must return to the Service within 120 calendar days not only the signed compliance statement and any additional compliance fee under section 12.05, but also a list containing (i) the employers’ tax identification numbers for the Plan Sponsors of the plans to which the compliance statement may be applicable, (ii) the plans by name, plan number, type of plan, and number of plan participants, (iii) a certification that each Plan Sponsor received notice of the Group Submission,

and (iv) a certification that each Plan Sponsor timely filed the Form 5500 series return for each plan. This list can be submitted at any stage of the submission process provided that the requirements of section 10.11(3)(b) have been satisfied. Applicants are encouraged to submit the list on a computer disk in Microsoft Word. Only those plans for which correction is actually made within 240 calendar days of the date of the signed compliance statement (or within such longer period as may be agreed to by the Service at the request of the Eligible Organization) will be covered by the compliance statement.

(d) Notwithstanding section 4.02, if a Plan Sponsor of a plan that is eligible to be included in the Group Submission and has not elected to be excluded from the Group Submission pursuant to section 10.11(3)(b) is notified of an impending Employee Plans examination after the Eligible Organization filed the Group Submission application, the Plan Sponsor’s plan will be included in the Group Submission. However, with respect to such plan, the Group Submission will not preclude or impede an examination of the plan with respect to any failures not identified in the Group Submission application at the time the plan comes Under Examination.

.12 Multiemployer and multiple em- ployer plans . (1) In the case of a multiemployer or multiple employer plan, the plan administrator (rather than any contributing or adopting employer) must request consideration of the plan under VCP. The request must be with respect to the plan, rather than a portion of the plan affecting any particular employer.

(2) If a VCP submission for a multiemployer or multiple employer plan has failures that apply to fewer than all of the employers under the plan, the plan administrator may choose to have the compliance fee (in section 12) or sanction (in section 14) calculated separately for each employer based on the assets attributable to that employer, rather than being attributable to the assets of the entire plan. Thus, the plan administrator may choose to apply the provisions of this paragraph where the failure is attributable in whole or in part to data, information, actions, or inactions that are within the control of the employers rather than the multiemployer or multiple employer plan (such as attribution in

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2. Hardship distribution failure being corrected using the method described in Appendix B, section 2.07(2)(a);

3. Loans permitted in operation but not permitted by Plan document being corrected using the method described in Appendix B, section 2.07(2)(a); or

4. Early inclusion of otherwise eligible employee(s) being corrected using the method described in Appendix B, section 2.07(3)(a). (4) An applicant may prepare a submission that includes one or more of the schedules in Appendix F. The inclusion of multiple schedules set forth in Appendix F does not affect the fee for the submission, as determined in accordance with section 12.02.

.03 Submission requirements . If the application includes failures and corrections that are not addressed in Appendix F, then the submission should be made in accordance with the format provided in Appendix D. The application should include the following:

(1) Identifying information for the ap- plicant . This would include, the name and Employer Identification Number (EIN) of the applicant. (Note: Social Security Numbers are not acceptable. An applicant can obtain an EIN by calling (800) 829–4933. An application for an EIN can also be made online by accessing www.irs.gov and typing “How to Apply for an EIN” in its search engine.)

(2) Identifying information for the Plan . A statement identifying the type of plan submitted ( e.g., Qualified Plan, 403(b) Plan, SEP, or SIMPLE IRA Plan). In addition, if the submission involves a Qualified Plan, the statement should also identify the type of Qualified Plan being submitted ( e.g., Defined Benefit, Money Purchase, Profit Sharing, or Stock Bonus, and 401(k) or ESOP).

(3) Plan Data . Information relating to the number of plan participants determined in accordance with section 12.07 and the total amount of plan assets as of the most recent 5500 filing (or, if not filed, the most recent data available to the Plan Sponsor) prior to the filing of this VCP submission.

(4) Type of Submission . Where applicable, the application should identify whether the submission is a Group Submission, an Anonymous Submission, a nonamender submission, a multiemployer or multiple employer plan submission, or an Orphan Plan submission.

made part of the compliance statement for the submission.

.02 Streamlined Application proce- dures . (1) If all of the Qualification Failures the Plan Sponsor proposes to correct through VCP are described in section 11.02(3) and the Plan Sponsor proposes to correct such failures using a correction method provided in the Appendix F schedules, then the submission should be made pursuant to those streamlined procedures. A Streamlined Application pursuant to this section consists of the Appendix F, the appropriate schedule(s) for the failure(s) (as described in section 11.02(3)), and all other documents required as indicated on the applicable schedule. The Service reserves the right to request additional information in connection with its processing of the Streamlined Application. The failure to provide the information required in the format provided in Appendix F may result in a delay in the processing of the submission. If only certain failures contained in the submission are described in section 11.02(3) (or one or more of the proposed corrections is not a method set forth in the Appendix F schedules), then the submission may be made pursuant to the Streamlined Application Procedures, to the extent applicable, and using the general rules of this section 11 to the extent the Streamlined Application procedures are not applicable.

(2) The Streamlined Application procedure in Appendix F should not be used if any of its provisions (including the failure, correction of the failure, or the Plan Sponsor’s representation) do not apply to the Plan or Plan Sponsor. In such circumstance, a VCP submission should be made in accordance with the provisions of section 11.03 and Appendix D of this revenue procedure.

(3) The failures eligible for the Streamlined Application procedure and the applicable Appendix F schedules are described as follows:

(a) Schedule 1 : If the Plan Sponsor failed to adopt timely (i) interim amendments described in section 6.05(2) or (ii) amendments required to reflect the changed operation of the plan on account of the Plan Sponsor’s decision to implement optional law changes described in section 6.05(3)(b) of this revenue procedure, the Plan Sponsor should submit Appendix F, Schedule 1.

(b) Schedule 2 : If the Plan Sponsor failed to timely adopt amendments to comply with required legislative or regulatory changes (other than those described in (3)(a)), the Plan Sponsor should submit Appendix F, Schedule 2.

(c) Schedule 3 : If the Plan is a SEP or a SARSEP and experienced one or more of the failures shown on Appendix F, Schedule 3, and if the Plan Sponsor proposes to correct such failure(s) by using the method(s) provided on such schedule, the Plan Sponsor should submit Appendix F, Schedule 3.

(d) Schedule 4 : If the Plan is a SIMPLE IRA and experienced one or more of the failures shown on Appendix F, Schedule 4, and if the Plan Sponsor proposes to correct such failure(s) by using the method(s) provided on such schedule, the Plan Sponsor should submit Appendix F, Schedule 4.

(e) Schedule 5 : If the Plan Sponsor failed to administer the loans in accordance with the provisions of § 72(p)(2), the failure solely relates to employees who are neither key employees (as defined in § 416(i)(1)) nor self-employed individuals (as defined in § 401(c)(1)(B)), the Plan Sponsor should submit Appendix F, Schedule 5.

(f) Schedule 6 : If the Plan Sponsor failed to satisfy the criteria for an employer to sponsor either a 403(b) Plan, or a § 401(k) plan, the Plan Sponsor should submit Appendix F, Schedule 6.

(g) Schedule 7 : If the plan failed to distribute elective deferrals made in excess of the § 402(g) limit, and the Plan Sponsor proposes to correct such failure using the method described in Appendix A, section .04, the Plan Sponsor should submit Appendix F, Schedule 7.

(h) Schedule 8 : If the plan failed to make required minimum distributions pursuant to § 401(a)(9), and proposes to correct such failure using the method described in Appendix A, section .06, then the Plan Sponsor should submit Appendix F, Schedule 8.

(i) Schedule 9 : The Plan Sponsor should submit Appendix F, Schedule 9 if the Plan experienced one or more of the following failures:

1. § 401(a)(17) failure being corrected using the method described in Appendix B, section 2.07(1)(a);

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necessary. For example, if the plan’s failure is the failure to satisfy the requirements of § 403(b)(1)(E) regarding elective deferrals, the Plan Sponsor must, prior to making the VCP application, contact the insurance company or custodian with control over the plan’s assets to assure cooperation in effecting a distribution of the excess deferrals and the earnings thereon. An application under VCP must also contain a statement as to the type of employer ( e.g., a tax-exempt organization described in § 501(c)(3)) submitting the VCP application.

(19) Group Submissions only . A Group Submission must be signed by the Eligible Organization or the Eligible Organization’s authorized representative and accompanied by a copy of the relevant portions of the plan document(s). In addition, a Group Submission must include a separate page for each affected Plan Sponsor that provides the Plan Sponsor’s name, EIN, plan name, and failure(s).

(20) Orphan Plans only . If the plan is an Orphan Plan, whether relief from the VCP application fee or correction is being requested, and the supporting rationale for such relief.

.04 Required documents . A VCP submission must be accompanied by the following documents:

(1) Plan document . A copy of the entire plan document or the relevant portions of the plan document. For example, in a case involving an improper exclusion of eligible employees from a profit-sharing plan with a cash or deferred arrangement, relevant portions of the plan document include the eligibility, allocation, and cash or deferred arrangement provisions of the basic plan document (and the adoption agreement, if applicable), along with applicable definitions in the plan. If the plan is a 403(b) Plan and a plan document is not available, a written description of the plan should be submitted, with sample salary reduction agreements if relevant. In the case of a SEP and a SIMPLE IRA Plan, the entire plan document should be submitted.

(2) Determination letter application . In any case in which correction of a Qualification Failure is made by plan amendment, as permitted under section 4.05, other than the adoption of an amendment designated by the Service as a model amendment or the adoption of a prototype or volume submitter plan for which the Plan Sponsor has

(5) Identification of Failures . A complete description of the failures, the years in which the failures occurred, including closed years (that is, years for which the statutory period has expired), and the number of employees affected by each failure.

(6) Explanation . An explanation of how and why the failures arose, including a description of the administrative procedures applicable to the failures in effect at the time the failures occurred.

(7) Proposed Method of Correction . A detailed description of the method for correcting the failures that the Plan Sponsor has implemented or proposes to implement. Each step of the correction method must be described in narrative form. The description must include the specific information needed to support the suggested correction method. This information includes, for example, the number of employees affected and the expected cost of correction (both of which may be approximated if the exact number cannot be determined at the time of the request), the years involved, and calculations or assumptions the Plan Sponsor used to determine the amounts needed for correction.

(8) Earnings or actuarial adjustments . A description of the methodology that will be used to calculate earnings or actuarial adjustments on any corrective contributions or distributions (indicating the computation periods and the basis for determining earnings or actuarial adjustments, in accordance with section 6.02(4)).

(9) Computations . Specific calculations for each affected employee or a representative sample of affected employees. The sample calculations must be sufficient to demonstrate each aspect of the correction method proposed. For example, if a Plan Sponsor requests a compliance statement with respect to a failure to satisfy the contribution limits of § 415(c) and proposes a correction method that involves elective deferrals (whether matched or unmatched) and matching contributions, the Plan Sponsor must submit calculations illustrating the correction method proposed with respect to each type of contribution. As another example, with respect to a failure to satisfy the ADP test in § 401(k)(3), the Plan Sponsor must submit the ADP test results both before the correction and after the correction.

(10) Former employees or beneficia- ries . The method that will be used to lo

cate and notify former employees and beneficiaries, or an affirmative statement that no former employees or beneficiaries were affected by the failures or will be affected by the correction.

(11) Change in administrative proce- dures . A description of the measures that have been or will be implemented to ensure that the same failures will not recur.

(12) Request for excise relief (§§ 4972, 4973, 4974 or 4979) or income tax relief under §72(t) . If relief is sought, a specific request for relief should be included in the submission, along with explanations, where applicable, supporting such request.

(13) Loan failures and income tax re- porting relief . A specific request for relief needs to be made if the applicant either wants relief from reporting a corrected participant loan as a deemed distribution or wants to report the loan as a deemed distribution in the year of correction instead of the year in which the deemed distribution occurred.

(14) Under Examination statement . A statement that, to the best of the Plan Sponsor’s knowledge, neither the plan nor the Plan Sponsor is Under Examination.

(15) Abusive tax avoidance transaction statement . A statement that neither the plan nor the Plan Sponsor has been a party to an abusive tax avoidance transaction (as defined in section 4.13(2)) or a brief identification of any abusive tax avoidance transaction to which the plan or the Plan Sponsor has been a party.

(16) Transferred Assets . If a submission includes a failure that relates to Transferred Assets and the failure occurred prior to the transfer, a description of the transaction (including the dates of the employer change and the plan transfer).

(17) Unrelated determination letter ap- plication requests . A statement (if applicable) that the plan is currently being considered in a determination letter application that is not related to the VCP application. If the request for a determination letter is made while a request for consideration under VCP is pending, the Plan Sponsor must update the VCP request to add this information.

(18) 403(b) Plans only . In the case of a 403(b) Plan submission, a statement that the Plan Sponsor has contacted all other entities involved with the plan and has been assured of cooperation in implementing the applicable correction, to the extent

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Acknowledgement Form in Appendix E and includes it in the submission. A separate Appendix E Acknowledgement Form should be included for each plan submitted. A photocopy of Appendix E may be used.

.13 VCP mailing address . All VCP submissions and accompanying determination applications, if applicable, should be mailed to:

Internal Revenue Service Attention: SE:T:EP:RA:VC P.O. Box 27063 Washington, D.C. 20038–7063

.14 Maintenance of copies of submis- sions . Plan Sponsors and their representatives should maintain copies of all correspondence submitted to the Service with respect to their VCP requests.

.15 Assembling the submission . The Service will be able to process a submission more quickly if the submission package contains all of the items required by the Appendix C checklist and is assembled in the following order:

1. If applicable, Form 8717, User Fee for Employee Plan Determination, Opin- ion, and Advisory Letter Request, and the check for the determination letter user fee made payable to the U.S. Treasury.

2. Determination letter application ( i.e., Form 5300, 5307, or 5310), if applicable.

3. Completed and signed Appendix C checklist.

4. A submission signed by the Plan Sponsor or Plan Sponsor’s authorized representative, with a check for the VCP fee made payable to the U.S. Treasury attached to the front of the submission letter. The submission should include the following information (see section 11.15, paragraph 5, for instructions relating to applications submitted in the Appendix D or Appendix F format):

• Type of plan (or group of plans) being submitted.

• Description of the failures (if the failures relate to Transferred Assets, include a description of the related employer transaction).

• An explanation of how and why the failures arose.

• Description of the method for correcting failures, including earnings methodology (if applicable) and supporting computations (if applicable).

reliance on the plan’s opinion or advisory letter as provided in Rev. Proc. 2008–6, 2008–1 I.R.B. 192, and the Plan Sponsor is submitting a determination letter request as permitted under section 6.05, the Plan Sponsor must submit a copy of the plan document in restated form, the appropriate application form ( i.e., Form 5300, 5307 or 5310), the appropriate user fee concurrently and to the same address as the VCP submission, and the most recent version of the Form 8717, User Fee for Em- ployee Plan Determination, Opinion, and Advisory Letter Request . Pursuant to section 12.04 of Rev. Proc. 2007–44, effective as of July 9, 2007, Form 6406, Short Form Application for Determination for Minor Amendment of Employee Benefit Plan, may not be used to apply for a determination letter. An application submitted with this form will no longer be accepted by the Service. The user fee for the determination letter application and the fee for the VCP submission must be submitted on separate checks made payable to the U.S. Treasury. See section 11.13 for the VCP mailing address.

.05 Date fee due generally . Except as provided in sections 11.06 and 12.02(4), the VCP fee under section 12 and, if applicable, the determination letter user fee must be included with the submission. The VCP fee and the determination letter user fee must be submitted on separate checks made payable to the U.S. Treasury. If the appropriate fees are not included in the submission, the submission will be returned.

.06 Additional fee due for SEPs, SIMPLE IRA Plans, and Group Submissions . In the case of a SEP, a SIMPLE IRA Plan, or a Group Submission, the initial fee described in section 12.02, 12.04, or 12.05 must be included in the submission and any additional fee is due at the time the compliance statement is signed by the Plan Sponsor and returned to the Service, or when agreement has been reached between the Service and the Plan Sponsor regarding correction of the failure(s).

.07 Signed submission . The submission must be signed by the Plan Sponsor or the Plan Sponsor’s authorized representative.

.08 Power of attorney requirements . To sign the submission or to appear before the Service in connection with the submission, the Plan Sponsor’s representa

tive must comply with the requirements of section 9.02(11) and (12) of Rev. Proc. 2008–4, 2008–1 I.R.B. 121, and submit Form 2848, Power of Attorney and Dec- laration of Representative . A Form 2848 that designates a representative not qualified to sign Part II of the Form 2848, e.g., an unenrolled return preparer, will not be accepted. A Plan Sponsor may authorize an individual, such as an unenrolled return preparer, to inspect or receive confidential information using Form 8821, Tax In- formation Authorization . (See Form 8821 and Instructions.) However, see section 10.10 for special rules relating to Anonymous Submissions.

.09 Penalty of perjury statement . The following declaration must accompany a request and any factual information or change in the submission at a later time: “Under penalties of perjury, I declare that I have examined this submission, including accompanying documents, and, to the best of my knowledge and belief, the facts presented in support of this submission are true, correct, and complete.” The declaration must be signed by the Plan Sponsor, not the Plan Sponsor’s representative.

.10 Checklist . The Service will be able to respond more quickly to a VCP request if the request is carefully prepared and complete. The checklist in Appendix C is designed to assist Plan Sponsors and their representatives in preparing a submission that contains the information and documents required under this revenue procedure. Except as otherwise provided in the checklist, the checklist in Appendix C must be completed, signed, and dated by the Plan Sponsor or the Plan Sponsor’s representative. A photocopy of this checklist may be used.

.11 Designation . The letter to the Service should indicate in the upper right hand corner of the letter the type of plan submitted under VCP–a Qualified Plan, 403(b) Plan, SEP, or SIMPLE IRA Plan. In addition, if the submission is a Group Submission, an Anonymous Submission, a nonamender submission, a multiemployer or multiple employer plan submission, or an Orphan Plan submission, the letter should so indicate.

.12 Acknowledgement letter . The Service will acknowledge receipt of a VCP submission if the Plan Sponsor or the Plan Sponsor’s representative completes the

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• Description of the method used to locate or notify former employees or beneficiaries affected by the failures or corrections. If no former employees or beneficiaries are affected by the failures or corrections, then the letter should affirmatively state that position when addressing this issue.

• Description of the administrative procedures that have been or will be implemented to ensure that the failures do not recur.

• Whether a request is being made in order for participant loans corrected under this revenue procedure to not be treated as deemed distributions under §72(p) and the supporting rationale for such request. Alternatively, whether a request is being made for participant loans corrected under this revenue procedure to be treated as deemed distributions under §72(p) in the year of correction.

• Whether relief is being requested from imposition of the excise taxes under §§ 4972, 4973, 4974, or 4979, or the 10% additional income tax under § 72(t), and the supporting rationale for such relief.

• If the plan is an Orphan Plan, whether relief from the VCP application fee is being requested, and the supporting rationale for such relief.

• A statement specifying whether the plan is being considered in an unrelated determination letter application (if applicable).

• A statement that the plan is not Under Examination.

• A statement that the Plan Sponsor is not under an Exempt Organizations examination.

• A statement that neither the plan nor the Plan Sponsor has been a party to an abusive tax avoidance transaction (as defined in section 4.13(2)) or a brief identification of any abusive tax avoidance transaction to which the plan or the Plan Sponsor has been a party.

• Penalty of perjury statement.

5. If the VCP application is submitted using either the Appendix F or the Appendix D format, the application should include a completed Appendix F or Appendix D, and any information/enclosures, including any related schedules. In addition, the application should include a separate Enforcement Resolution page.

6. Appendix E acknowledgement letter.

7. Power of Attorney (Form 2848) or Tax Information Authorization (Form 8821), if applicable.

8. Copy of opinion or determination letter (if applicable).

9. Relevant plan document language or plan document (if applicable).

10. Any other items that may be relevant to the submission.