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ARTICLE · 01 AUGUST 2025

Simplified Option For Correcting Certain Retirement Plan Failures

Kelley Drye & Warren LLP
Kelley Drye & Warren LLP
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Kelley Drye & Warren LLP

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Earlier this year, the U.S. Department of Labor ("DOL") amended its Voluntary Fiduciary Compliance Program ("VFCP") to provide retirement plan sponsors with a simplified...

United StatesEmployment and HR
Pamela D. Kaplan
Pamela D. Kaplan
Victoria E. Anderson
Victoria E. Anderson
Samuel J. Baldwin
Samuel J. Baldwin

Earlier this year, the U.S. Department of Labor ("DOL") amended its Voluntary Fiduciary Compliance Program ("VFCP") to provide retirement plan sponsors with a simplified option for correcting certain specified prohibited transactions. The simplified option will be welcome news to employers that are late depositing participant contributions into a 401(k) plan or who administer plan loans incorrectly – relatively common mistakes that previously required filing an application with the DOL to fully correct. While the new self-correction option is available for certain other specified, less common problems, the foregoing are the major targets of the new simplified VFCP process.

The new rules, which became effective on March 17, 2025, provide for the following:

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