When the 5500s are due and audits have to be completed, there is always an issue regarding late deferrals when the employer failed to remit these contributions as soon as possible.<\/p>\n
As of right now, late deferrals are my most popular error to fix for clients. It\u2019s not surprising as plan sponsors who make the mistake of late deferral deposits do it again and again. Any plan that has late deferrals have to self-correct their issue and make any earnings adjustments, based on how long it took to correct their error. While many auditors say that all a plan sponsor does is to self-correct, I disagree. I believe that any plan that has to self-correct, should also apply to the Department of Labor (DOL) Voluntary Fiduciary Compliance Program (VFCP). Why do I suggest that? Well, I\u2019ve had clients who admitted that they made late deferrals and received correspondence from the DOL, noting that they don\u2019t have a VFCP application from that particular plan sponsor. It\u2019s a strong suggestion from the DOL that a VFCP application should have been filed. So that\u2019s why I suggest that plan sponsors file a VFCP application because I don\u2019t like correspondence from the DOL and it\u2019s my concern that the lack of a VFCP application could make the plan sponsor a target for a DOL audit.<\/p>\n
All plans with late deferrals need to self-correct, but I suggest a DOL VFCP filing (there is no user fee and the flat fee costs I charge won\u2019t be that expensive).<\/p>\n
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