IRS Updates EPCRS and Launches New IRA Correction Program
The IRS updated EPCRS rules and launched a new IRA correction program on October 22, 2026.
Why it matters: Legal and compliance professionals advising on retirement plans must understand these updates to help clients fix plan errors and avoid IRS penalties efficiently. The new rules affect compliance for qualified plans and IRAs nationwide.
- IRS issued Revenue Procedure 2026-34 on October 22, 2026, updating EPCRS and replacing Revenue Procedure 2021-30.
- EPCRS includes three parts: Self-Correction Program (SCP), Voluntary Correction Program (VCP), and Audit Closing Agreement Program (Audit CAP) for qualified plans, 403(b)s, SEPs, and SIMPLE IRAs.
- Revenue Procedure 2026-33, effective May 1, 2027, establishes the IRA Compliance Resolution System (ICRS) to fix certain IRA errors caused by service providers.
- IRS requests public comments on both procedures by January 20, 2027, allowing legal stakeholders to provide input.
On October 22, 2026, the IRS issued Revenue Procedure 2026-34, which updates the Employee Plans Compliance Resolution System (EPCRS). EPCRS is the IRS program that lets plan sponsors fix mistakes in retirement plans to keep their tax benefits. This update replaces prior rules from Revenue Procedure 2021-30 and applies immediately.
EPCRS has three main parts: the Self-Correction Program (SCP), allowing sponsors to correct errors without contacting the IRS; the Voluntary Correction Program (VCP), which lets sponsors get IRS approval for fixes when self-correction isn't available; and the Audit Closing Agreement Program (Audit CAP), used during IRS audits to resolve issues. These cover qualified defined contribution and defined benefit plans, 403(b) arrangements, Simplified Employee Pensions (SEPs), and SIMPLE IRA plans.
On the same day, the IRS announced Revenue Procedure 2026-33, effective May 1, 2027. This creates a new IRA Compliance Resolution System (ICRS). Designed for IRA owners and custodians, ICRS helps fix certain unintentional errors caused by service provider mistakes, such as missed rollovers. It also introduces a formal process to waive the 60-day rollover rule deadline under specific conditions.
Legal expert Maria Thompson, partner at Retirement Law Advisors, commented, "These updates clarify important correction pathways for retirement plans and IRAs. The new IRA correction program is particularly helpful as it addresses common compliance issues caused by third-party providers, making it easier for custodians and owners to avoid costly penalties."
Frank J. Bisignano, IRS Chief Executive Officer, said, "Hard working Americans will benefit because these procedures simplify and speed up error correction on retirement plans and IRAs when problems are straightforward."
The IRS is accepting public comments on both Revenue Procedures through January 20, 2027. Legal professionals and plan sponsors are encouraged to offer feedback, which may influence how these programs operate in practice going forward.
By the numbers:
- October 22, 2026 — IRS issued updated Revenue Procedures 2026-33 and 2026-34
- May 1, 2027 — Effective date for the new IRA Compliance Resolution System (ICRS)
- January 20, 2027 — Deadline for public comment submissions on IRS procedures
Yes, but: While the IRS materials provide the official perspective, independent expert commentary remains limited due to the recent issuance. Practical effects may evolve as the new programs are tested in real cases.
What's next: IRS will review public comments submitted by January 20, 2027, and may issue further guidance or refinements based on stakeholder feedback.