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Jan 3 2011

Blitman & King Successfully Guides Plan Through IRS Voluntary Correction Program To Address In-Service Distributions

Author(s): Blitman & King LLP

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On behalf of a multiemployer defined benefit pension plan, Blitman & King, LLP submitted an application to the Internal Revenue Service (IRS) for participation in its Voluntary Compliance Program. The matter involved qualification errors related to in-service distributions and recalculation of benefits. Prior to submission to the IRS, with the assistance Blitman & King, LLP, the Board of Trustees took remedial action to correct the errors. The submission asked that the IRS approve and accept the method of correction adopted by the Trustees. Recently, the plan received a favorable Compliance Statement. The IRS determined that the plan’s proposed method of correction was appropriate and indicated that it would not pursue plan disqualification. Also, fortunately for the plan, its fiduciary liability insurance carrier covered all expenses related to the submission, including the IRS filing fee and the attorneys’ fees and costs incurred in connection with the matter.