Employee Plans Compliance Unit (EPCU) - Current Projects - Funding Deficiencies


Why did I receive an EPCU Compliance Check PDF Letter?

When a funding deficiency is reported on a filed return, the EPCU will determine whether a funding deficiency exists. If it appears one does exist, we send the applicable compliance check letter.

We will determine whether the funding deficiency was corrected, the required excise tax return(s) were filed, and appropriate taxes paid. Correction for late or underfunded defined contribution Money Purchase Pension or Target Benefit plans may also involve a VCP submission (see Other resources below).


The content of this project is the result of collaboration between the Treasury Inspector General’s office and Examinations areas within Employee Plans of Tax Exempt and Government Entity (TE/GE). EPCU will mail the compliance contact letter and information request to plans identified as reporting a funding deficiency amount. If the sponsoring organization is compliant, the contact will  be resolved, and we will issue a closing letter notifying the sponsoring organization. Failure to provide this information, fully fund your plan, or file necessary Form 5330 returns reporting an applicable excise tax, could result in further action or examination of your plan.

What is the EPCU attempting to determine?

The EPCU Funding Deficiencies Project is focused on Forms 5500/5500-EZ/5500-SF reporting unpaid minimum required contributions on Schedules SB, MB, R, or Forms 5500-EZ and 5500-SF. Compliance checks are conducted to determine whether:

  • The minimum required contributions have been made or if not, why.
  • The applicable Forms 5330 reporting excise tax under IRC section 4971 have been filed for defined benefit plans.
  • Defined contribution Money Purchase Pension Plans or Target Benefit Plans have completed correction.
  • The sponsor has filed for a funding waiver, termination, PBGC distress termination, or bankruptcy.

Common errors

Information is sometimes reported incorrectly on the series of Form 5500 filings. In order to avoid unnecessary contacts, please double check your return before filing to ensure:

  1. The amounts shown for the required funding amount, contributions made, and unpaid required minimum funding amount are included and correct.
  2. Double-check the information to be sure it is reflected on the correct line item. A common error for defined contribution plans is the amount of contributions is incorrectly input as the unpaid required amount instead.
  3. The correct plan number is used.
  4. Each Plan has a different plan number.

If you have misplaced your correspondence and no longer have the return address, you can mail your response to:

Mail Stop 1113
2730 Washington Blvd Box 1190
Ogden, UT  84401-2344

If you have questions

Please feel free to contact the person listed in the cover letter with questions about this project and how it relates to your situation. 

What actions do I need to take?

Please provide the information requested in the Form 886-A attached to your letter. If you are required to file a Form 5330, this should be sent to the address shown at the top of the letter.

You may furnish other documents or clarifying material that you believe will be helpful for us to review. You should make every effort to answer the questions as accurately as possible. Failure to provide this information could result in further action or examination of your plan.

If you need additional time, please contact the person whose name is listed on the cover letter to request an extension prior to the response due date.

Other resources