IRS Form 14568-B Guide: Fix 401(a) Nonamender Plan Rules

1. Introduction: What is Form 14568-B?

IRS Form 14568-B, officially titled Schedule 2 (Form 14568-B) – Model VCP Compliance Statement: Nonamender Failures for 401(a) Plans, is a specialized compliance schedule created by the Internal Revenue Service (IRS). It is governed by Employee Plans (EP), a division of the IRS Tax Exempt and Government Entities (TE/GE) Division.

This form is used as a standardized attachment to Form 14568 (Model VCP Compliance Statement) under the IRS Voluntary Correction Program (VCP). It is designed specifically for employers sponsoring qualified retirement plans under Section 401(a)—such as 401(k), profit-sharing, money purchase, and defined benefit plans—that failed to adopt mandatory legal amendments or required plan restatements by federal deadlines.

2. Purpose of the Form: Why Does Form 14568-B Exist?

To maintain tax-qualified status under federal law, retirement plans must strictly adhere to changing legislation enacted by Congress. As tax rules evolve, the IRS requires plan sponsors to update their legal plan documents through timely amendments within defined windows known as remedial amendment periods.

When an employer misses an amendment deadline, the plan incurs a “nonamender failure.” Form 14568-B exists to provide an orderly, standardized mechanism to resolve this problem:

• Preventing Plan Disqualification: An unamended plan document technically loses its tax-exempt status, which can trigger taxes on the entire retirement trust and retroactively eliminate employer tax deductions. Form 14568-B preserves the qualified status of the plan.
• Streamlined Approval: It provides pre-approved IRS language that allows employers to adopt retroactive amendments without drafting expensive, custom legal requests.
• Legal Assurance: Once the IRS signs and approves the compliance statement, the plan sponsor receives binding legal confirmation that the IRS will not disqualify the plan for the identified missing amendments.

3. Who Needs to File This Form?

Form 14568-B is filed by employers, business owners, and plan administrators (known as plan sponsors) who discover that their 401(a) plan document is out of compliance. You need to use this form if you meet the following conditions:

• You sponsor a qualified plan under Section 401(a), such as a traditional 401(k), safe harbor 401(k), profit-sharing plan, or defined benefit pension plan.
• Your plan failed to adopt timely interim or mandatory amendments required by federal tax acts or the IRS Required Amendments List (RAL).
• Your plan missed statutory deadlines to adopt an updated pre-approved prototype or volume submitter plan restatement (such as during multi-year cycle restatement windows).
• You are submitting a Voluntary Correction Program filing through Pay.gov using IRS Form 8950 and master Form 14568.

4. Who Is Exempt / Not Required to File?

Form 14568-B is tailored strictly to Section 401(a) document nonamender errors. You are not required or eligible to file this form under the following circumstances:

• Section 403(b) Retirement Plans: Public schools and 501(c)(3) nonprofit organizations with 403(b) document failures must use Form 14568-A rather than Form 14568-B.
• Fully Compliant Plans: Employers that have timely signed and maintained all required plan amendments, cycle restatements, and board resolutions have no need for this schedule.
• Purely Operational Errors: If your plan document was amended on time, but day-to-day administrative errors occurred (such as failing a nondiscrimination test, miscalculating matching contributions, or mishandling participant loans), you should use other schedules like Form 14568-E or Form 14568-G.
• Plans Already Under Examination: If the IRS has notified your business that your retirement plan is being audited, you are ineligible for VCP and must resolve document errors through the Audit Closing Agreement Program (Audit CAP).

5. When to File: Deadlines and Frequency

Form 14568-B is an event-based submission rather than an annual recurring filing. You complete it only when a nonamender defect is identified.

The submission must occur before the IRS notifies you that the plan or company is under audit. Once an IRS examination notice is issued, the Voluntary Correction Program is closed to the plan. After the IRS approves the submission and delivers your executed compliance statement, the plan sponsor generally has 150 calendar days to formally execute all retroactive plan amendments.

6. Where and How to File

Form 14568-B is not filed on paper through standard mail. It must be uploaded digitally through the federal government’s online payment system:

• Pay.gov Electronic Submission: Complete Form 14568-B as an attachment to master Form 14568. Merge the forms, proposed amendments, and supporting exhibits into a single PDF package and upload it via Pay.gov alongside Form 8950 (Application for Voluntary Correction Program).
• User Fee Payment: The mandatory VCP user fee—determined by the net asset value of the retirement plan—must be paid electronically via Pay.gov at the time of submission.
• Supplemental Submissions: If the reviewing IRS Employee Plans specialist requests additional documentation, items must be submitted electronically or delivered to the designated IRS address as per instructions provided by the assigned specialist.

7. Step-by-Step Instructions to Fill Form 14568-B

Form 14568-B uses standardized language to document missed amendments, confirm retroactive corrections, and outline future administrative controls. The table below summarizes its primary parts.

Section	Title	Required Information
Header	Plan & Sponsor Identification	Plan name, Employer Identification Number (EIN), and 3-digit plan number (on every page).
Section I	Identification of Failures	Checkboxes and lists identifying specific missed tax acts, cumulative list items, or restatements.
Section II	Correction Method	Confirmation of retroactive amendment adoption and operational alignment statement.
Section III	Administrative Procedures	Narrative describing updated internal tracking and oversight systems to prevent future misses.
Section IV	Enclosures	List of attached proposed amendments, prior determination letters, and board resolutions.

Header: Plan and Sponsor Identification

Enter the complete legal name of the retirement plan, the plan sponsor’s nine-digit Employer Identification Number (EIN), and the three-digit plan number (such as 001). Federal rules require this exact identifying information to appear at the top of every page of Form 14568-B and all attached exhibits.

Section I: Identification of Failures

Identify whether the plan is an individually designed plan or a pre-approved prototype/volume submitter plan. Then, specify the exact statutory changes that were missed:

• List the specific tax legislation, IRS Required Amendments List (RAL) notices, or Cumulative List provisions that were not timely adopted.
• State the exact statutory deadline by which each missing amendment should have been executed.
• If the plan missed an entire pre-approved cycle restatement deadline, identify the relevant restatement period and missing adoption agreement.

Section II: Description of Proposed Method of Correction

Under this section, confirm that the plan sponsor will adopt corrective plan amendments retroactively to the date the amendments were legally required to be effective. You must also affirm that plan operations actually conformed to the terms of the retroactive amendments, or disclose whether any related operational failures occurred that require separate correction.

Section III: Revision of Administrative Procedures

The IRS requires proof that the employer has taken concrete steps to prevent nonamender errors in the future. In this section, provide a concise narrative describing updated administrative procedures:

• Explain how you and your Third-Party Administrator (TPA) or ERISA legal counsel will track future regulatory deadlines.
• Describe tickler systems, annual compliance calendars, or formal review procedures added to board or committee agendas.

Section IV: Enclosures and Attachments

List and verify all supporting documents included with your submission. This includes the proposed retroactive amendments ready for signature, copies of previous plan documents, and the most recent IRS Favorable Determination Letter or Opinion Letter.

8. Required Documents and Information Needed Before Filling

Before preparing Form 14568-B, compile the following records from your plan’s administrative files:

• The current executed plan document, adoption agreements, and all historical amendments.
• The most recent IRS Favorable Determination Letter, Advisory Letter, or Opinion Letter.
• The text of the proposed retroactive amendments that will cure the nonamender failure.
• The exact effective dates and original execution deadlines for each missing amendment.
• Completed master Form 14568 and Form 8950.
• A signed Form 2848 (Power of Attorney and Declaration of Representative) if an attorney, CPA, or enrolled retirement plan agent is submitting the package on your behalf.

9. Common Mistakes to Avoid

Form 14568-B is an official model schedule. Deviating from standard procedures can result in processing delays or rejection. Avoid these frequent mistakes:

• Altering Model Language: The wording in Form 14568-B is pre-approved by the IRS. Striking out, modifying, or rewriting the standard legal text will cause the IRS to treat your application as an expensive, customized submission rather than a streamlined model filing.
• Failing to Identify Every Missed Amendment: Omitting a missed amendment leaves that specific defect uncorrected. Ensure your ERISA counsel or TPA conducts a full document audit across all open years.
• Vague Explanations for Administrative Controls: Section III must outline specific processes. Merely promising that management “will stay informed” is insufficient and prompts IRS follow-up requests.
• Forgetting to Formally Adopt Amendments After Approval: Receiving an IRS compliance statement does not automatically amend your plan. The plan sponsor must formally execute and date the retroactive amendments within 150 days of approval.
• Using the Form for Non-401(a) Plans: Do not use this form for 403(b) plans or SIMPLE IRAs. Use Form 14568-A for 403(b) plans and Form 14568-D for SIMPLE IRAs.

10. Penalties for Non-Filing or Errors

Failing to correct nonamender failures before the IRS uncovers them during an examination can have devastating consequences for a business and its workforce:

• Total Plan Disqualification: The retirement trust loses its tax-exempt status under Internal Revenue Code Section 501(a).
• Loss of Business Deductions: The employer can lose federal income tax deductions taken for company matching and profit-sharing contributions for all open tax years.
• Immediate Participant Taxation: All vested account balances become immediately taxable to employees as ordinary income, triggering unexpected tax liabilities for participants.
• Severe Audit CAP Sanctions: If the IRS discovers the missing amendments during an audit, you must negotiate a financial sanction under the Audit Closing Agreement Program (Audit CAP), which is substantially higher than standard VCP user fees.

11. Related Forms or Schedules

Form 14568-B works within a broader system of retirement plan compliance forms:

• Form 14568: Model VCP Compliance Statement (the master application).
• Form 14568-A: Schedule 1 – Plan Document Failures for 403(b) Plans.
• Form 8950: Application for Voluntary Correction Program (VCP) Submission.
• Form 8951: Additional User Fee Payment for Open VCP Request.
• Form 5500 / 5500-SF: Annual Return/Report of Employee Benefit Plan.
• Form 2848: Power of Attorney and Declaration of Representative.

12. Frequently Asked Questions (FAQs)

1. What is a “nonamender failure” in simple terms?

A nonamender failure occurs when an employer does not update its written retirement plan document to reflect changes in federal tax law by the mandatory deadline set by Congress or the IRS.

2. Can I use Form 14568-B for a standard 401(k) plan?

Yes. Because 401(k) plans are qualified plans governed by Section 401(a) of the Internal Revenue Code, Form 14568-B is the correct schedule to resolve missed amendment deadlines for them.

3. How long do I have to adopt the amendments once the IRS approves my submission?

Once the IRS signs and issues the final compliance statement, the plan sponsor generally has 150 calendar days from the date of the compliance statement to formally execute the retroactive plan amendments.

4. How much is the IRS user fee for Form 14568-B?

The user fee is paid through Pay.gov when submitting Form 8950. The fee ranges from $1,500 to $3,500 depending on the total dollar value of assets held in the plan at the time of submission.

5. Can I self-correct nonamender failures without filing Form 14568-B?

Under IRS EPCRS guidelines, significant nonamender failures and missed cycle restatements generally cannot be self-corrected under the Self-Correction Program (SCP). Sponsors must submit a formal VCP application with Form 14568-B to receive binding protection.

6. What happens if the plan was operated differently than the missing amendment required?

If your plan also experienced operational errors during the unamended period, those operational failures must be disclosed and corrected alongside the document error on your master Form 14568 submission.

13. Conclusion: Key Takeaways

IRS Form 14568-B offers an essential, predictable path for employers to resolve missed retirement plan amendment deadlines. By utilizing this standardized schedule under the Voluntary Correction Program, plan sponsors can adopt required legal updates retroactively, maintain the tax-exempt status of their trust, and protect both company tax deductions and employee savings.

Because identifying missed legislative amendments and drafting retroactive plan language requires specialized technical knowledge, plan sponsors should collaborate with an experienced ERISA attorney, third-party administrator, or qualified benefits consultant when submitting Form 14568-B.