You can correct most retirement plan operational failures under the Employee Plans Compliance Resolution System (EPCRS). For most plans, an operational failure is when a plan sponsor does not follow its plan’s terms. That general definition now applies to IRC Section 403(b) plans but only for failures that occurred on or after January 1, 2009. For failures that occurred before January 1, 2009, the definition of operational failure for 403(b) plans was limited to certain failures listed in Revenue Procedure 2019-19. These included operational failures that occurred because the plan sponsor didn’t: follow the universal availability rule limit a participant’s compensation satisfy the actual contribution percentage test requirements comply with the distribution restrictions satisfy incidental death benefit rules pay minimum required distributions allow employees the right to elect a direct rollover give the direct rollover rights in the annuity contract or custodial agreement limit annual elective deferrals state the annual limit on elective deferrals in the annuity contract or custodial agreement limit contributions or allocations and causing excess amounts satisfy any other 403(b) plan requirements that caused the plan or one or more of its custodial accounts to lose its 403(b) status, other than a demographic failure, employer eligibility failure or a failure of making contributions for non-employees. Why are operational failures occurring before January 1, 2009, treated differently? 403(b) plans weren’t required to have or operate according to a written plan before January 1, 2009. Therefore, a 403(b) plan sponsor’s failure to follow the plan’s terms before January 1, 2009, wasn’t a failure that a sponsor could fix through EPCRS. Sponsors can still correct only those operational failures that occurred before January 1, 2009, that are allowed under Revenue Procedure 2008-50. How is an operational failure that spans the period before January 1, 2009 and continues past that date treated? We can’t address a failure to follow the terms of a 403(b) plan document that occurred before January 1, 2009, unless the failure meets one of the operational failures outlined in Revenue Procedure 2008-50. So, if a failure occurring before January 1, 2009 doesn’t meet the Revenue Procedure 2008-50 definition of a 403(b) operational failure, a plan sponsor may correct it using Revenue Procedure 2016-51 but only for the period after December 31, 2008.