Printable Form 2026

IRS Form 14568 – Model VCP Compliance Statement

IRS Form 14568 – Model VCP Compliance Statement – In the complex world of retirement plan administration, maintaining compliance with Internal Revenue Code (IRC) requirements is essential to avoid penalties and ensure tax-favored status. One key tool for correcting errors is the IRS’s Voluntary Correction Program (VCP), part of the Employee Plans Compliance Resolution System (EPCRS). At the heart of many VCP submissions is IRS Form 14568, known as the Model VCP Compliance Statement. This form helps plan sponsors describe failures, propose fixes, and seek IRS approval for corrections.

Whether you’re a plan administrator, employer, or tax professional dealing with retirement plans under sections like 401(a), 403(b), 408(k), or 408(p), understanding Form 14568 can streamline the correction process. In this guide, we’ll break down what the form is, its purpose, how to use it, and key considerations for successful submissions. All information is based on the latest IRS guidance as of 2026.

What is IRS Form 14568?

IRS Form 14568 is a standardized document provided by the Internal Revenue Service (IRS) for use in the Voluntary Correction Program (VCP). It serves as a compliance statement where applicants outline qualification failures in their retirement plans, detail proposed correction methods, and request specific relief from taxes or reporting obligations. The form is designed to ensure that submissions are complete and consistent, helping the IRS review and approve corrections efficiently.

This model form is not mandatory but is highly recommended because it structures the information in a way that aligns with IRS expectations. You cannot modify its format or content, but you can attach additional narratives or schedules to provide more details. The latest version of Form 14568 is available for download directly from the IRS website.

The Purpose of Form 14568 in the Employee Plans Compliance Resolution System (EPCRS)

The EPCRS is the IRS’s framework for correcting mistakes in retirement plans, preventing disqualification and associated tax consequences. It includes three main programs: Self-Correction Program (SCP), Voluntary Correction Program (VCP), and Audit Closing Agreement Program (Audit CAP). Form 14568 is specifically tied to VCP, where plan sponsors voluntarily disclose errors before an IRS audit.

The primary purpose of the form is to:

  • Identify and describe plan failures that violate IRC requirements.
  • Propose reasonable correction methods that restore compliance.
  • Request IRS non-pursuit of certain excise taxes, additional taxes, or reporting requirements.
  • Outline revisions to administrative procedures to prevent future issues.

By submitting Form 14568 as part of a VCP application, you receive a compliance statement from the IRS, which provides assurance that the plan won’t be disqualified for the disclosed failures if corrections are completed within 150 days. This process is governed by Revenue Procedure 2021-30, which emphasizes that corrections must be appropriate and consider all relevant facts.

How to Use Form 14568 in VCP Submissions?

To submit a VCP application involving Form 14568, follow these steps:

  1. Prepare Your Submission: File electronically via Pay.gov using Form 8950. Include Form 14568 to describe failures and corrections.
  2. Identify Failures: Use the form to list specific issues, such as operational errors or plan document problems.
  3. Propose Corrections: Detail how you’ll fix the issues, ensuring methods align with EPCRS principles.
  4. Attach Schedules if Applicable: For common failures, use model schedules like Form 14568-A through I (e.g., Schedule 8 for required minimum distribution failures).
  5. Pay the User Fee: Fees vary based on plan assets and failure type.
  6. Implement Corrections: Once approved, complete fixes within the specified timeframe.

The IRS reviews submissions and may request more information. If approved, you’ll get a signed compliance statement. Tips for success include using separate lines for each failure year in schedules like 14568-H to avoid common mistakes.

Key Sections of IRS Form 14568

Form 14568 is structured into several sections to organize your submission clearly. Here’s a breakdown:

  • Section I: Identifying Information – Enter the applicant’s name, Employer Identification Number (EIN), plan number, and plan name. This must appear on every page, including attachments.
  • Section II: Description of Failures – List and number each failure separately. Attach extra pages if needed, labeled accordingly. Reference any attached schedules.
  • Section III: Proposed Method of Correction – Explain the fix for each failure from Section II. Include details on how corrections will be implemented and attach supporting schedules.
  • Section IV: Procedures to Locate and Notify Former Employees or Beneficiaries – Describe efforts to contact affected parties or state that none are impacted.
  • Section V: Proposed Revision to Administrative Procedures – Detail why the failure occurred and steps to prevent recurrence, such as updated training or software.
  • Section VI: Requests Related to Excise Taxes, Additional Tax, and Tax Reporting – Seek relief from taxes under IRC sections like 4974 or 72(t), or specific reporting for plan loans. Attach narratives explaining the request.
  • Section VII: Enforcement Resolution – This is completed by the IRS, outlining the terms of approval, including limitations on reliance and conditions for compliance.

For specific types of failures, the IRS provides model schedules to standardize corrections:

  • Form 14568-A: Schedule 1 – Interim and Certain Discretionary Nonamender Failures
  • Form 14568-B: Schedule 2 – Other Nonamender Failures and Failure to Adopt a 403(b) Plan Timely
  • Form 14568-C: Schedule 3 – SEPs and SARSEPs
  • Form 14568-D: Schedule 4 – SIMPLE IRAs
  • Form 14568-E: Schedule 5 – Plan Loan Failures
  • Form 14568-F: Schedule 6 – Employer Eligibility Failure
  • Form 14568-G: Schedule 7 – Failure to Distribute Elective Deferrals
  • Form 14568-H: Schedule 8 – Failure to Pay Required Minimum Distributions Timely
  • Form 14568-I: Schedule 9 – Limited Safe Harbor Correction by Plan Amendment

These schedules help address common issues like minimum distribution failures or loan problems. Always attach them to the main Form 14568 when relevant.

Requests for Tax Relief and Reporting in Form 14568

One of the form’s key benefits is requesting relief:

  • Excise Taxes: Under sections 4972, 4973, 4974, or 4979 for overcontributions, minimum distributions, or excess amounts.
  • Additional Tax under 72(t): For early distributions.
  • Plan Loan Reporting: Options to report deemed distributions in the correction year or seek non-reporting relief under 72(p).

Provide detailed rationales in attachments to support these requests.

Enforcement and Limitations of the Compliance Statement

Upon approval, the IRS’s enforcement resolution in Section VII states it won’t pursue plan disqualification for the specified failures. However, this is conditional on accurate disclosures and timely corrections. It doesn’t cover undisclosed issues, other years, or ERISA violations. For governmental or 403(b) plans, special rules apply for amendments.

Tips for Filing IRS Form 14568 Successfully

  • Use Official IRS Resources: Download the form and schedules from irs.gov to ensure you’re using the current version.
  • Be Detailed: Include narratives for complex failures and use tables in schedules for clarity, like listing affected participants by year.
  • Avoid Common Errors: For RMD failures, separate data by calendar year.
  • Seek Professional Help: Consult a tax advisor if dealing with multiple failures.
  • Check for Updates: EPCRS rules can change; review Rev. Proc. 2021-30 or successors.

Frequently Asked Questions About IRS Form 14568

1. What plans can use Form 14568?

It applies to qualified plans under 401(a), 403(b) plans, SEPs (408(k)), and SIMPLE IRAs (408(p)).

2. Is Form 14568 required for all VCP submissions?

No, but it’s recommended to ensure completeness.

3. How long do I have to correct after approval?

Typically 150 days from the compliance statement date.

4. Can I modify the form?

No, the format and content must remain unchanged.

Conclusion

IRS Form 14568 plays a crucial role in the VCP, offering a structured way to correct retirement plan errors and maintain compliance. By using this model compliance statement effectively, plan sponsors can avoid severe penalties and secure IRS approval for their corrections. Always rely on official IRS sources for the most accurate guidance, and consider professional assistance for complex cases. If you’re facing a plan failure, starting with a VCP submission could be your best path to resolution.