Voluntary Compliance Resolution Program (Rev. Proc. 92-89).

On February 23, 1993, Tax Executives Institute filed the following comments with the Internal Revenue Service on Revenue Procedure 92-89, relating to the IRS's Voluntary Compliance Resolution (VCR) Program for employee benefit plans. The comments were prepared under the aegis of the Employee Benefits Subcommittee of the Institute's Federal Tax Committee; the subcommittee's chair is David L. Klausman of Westinghouse Electric Corporation, and the committee's chair is David F. Nitschke of Amerada Hess Corporation. The submission took the form of a letter from TEI President Robert H. Perlman to acting Commissioner of Internal Revenue, Michael P. Dolan.

On October 28, 1992, the Internal Revenue Service released Rev. Proc. 92-89 (1992-46 I.R.B. 27) setting forth the Voluntary Compliance Resolution (VCR) program guidelines and procedures. VCR is a temporary, experimental program permitting employers that meet certain conditions to voluntarily correct operational defects in their qualified retirement plans and avoid the risk that the IRS may disqualify their plans. TEI believes that the VCR program generally reflects a thoughtful balance of the myriad tax and social policy goals inherent in the qualified retirement plan area. In the comments that follow, TEI addresses certain issues that it believes require clarification to ensure that the VCR program is accessible to all taxpayers, particularly Coordinated Examination Program (CEP) taxpayers.

Background

Tax Executives Institute is the principal association of business tax executives in North America. The Institute's approximately 4,700 members represent more than 2,400 of the largest companies in the United States and Canada. TEI is dedicated to the development and effective implementation of sound tax policy, to promoting the uniform and equitable enforcement of the tax laws, and to reducing the cost and burden of administration and compliance to the benefit of taxpayers and the government alike. We believe that the diversity and training of our members enable us to bring an important, balanced, and practical perspective to the issues raised by the Rev. Proc. 92-89 and the VCR program.

General Comments

The volume and pace of legislative and administrative changes affecting employer-sponsored retirement plans in the last decade have been enormous. Taxpayers have expended herculean efforts and vast resources to implement required plan amendments and monitor compliance with those changes. Despite a...