Employee Plans Compliance Resolution System acronym. The IRS offers the following three programs to identify and correct plan mistakes and avoid the consequences of plan disqualification:
- Self-Correction Program (SCP) – permits a Plan Sponsor to correct certain plan failures without contacting the IRS or paying any fee.
- Voluntary Correction Program (VCP) – permits a Plan Sponsor to, any time before audit, pay a fee and receive IRS approval for correction of plan failures.
- Audit Closing Agreement Program (Audit CAP) – permits a Plan Sponsor to pay a sanction and correct a plan failure while the plan is under audit.