VFCP application or self-correction, and what each path buys

The full application: the only path that ends in a letter

The full application is paperwork to an EBSA regional office and ends, if accepted, in a no-action letter. The program text states what that letter does:

“Pursuant to the no action letter it issues, EBSA will not initiate a civil investigation under Title I of ERISA regarding the applicant's responsibility for any transaction described in the no action letter, or assess civil penalties under either section 502(l) or 502(i) of ERISA on the correction amount paid to the plan or its participants.”

(90 FR 4192, program section 2(a)(1), read 2026-08-25.) Lost earnings run from the earliest date the contributions could reasonably have been segregated, per 29 CFR 2510.3-102, and may be computed with EBSA’s Online Calculator or manually under the program’s rules. There is no cap on the amounts involved: a plan with six figures of lost earnings has exactly one path into the program, and this is it.

The SCC: faster, capped, and no letter

The SCC replaces the paper application with an electronically filed SCC notice through EBSA’s web tool, and the program is explicit about what a self-corrector does not get:

“EBSA will not issue a no action letter to a self-corrector under the Program's SCC. A self-corrector will receive an acknowledgment and summary of the SCC notice submission by email.”

The protection that follows compliance (program section 2(a)(2)) is nonetheless worded almost identically to the letter’s: no civil investigation of the corrected breach, no 502(l) or 502(i) penalties on the correction amount. The conditions are where the SCC narrows, and both come from 90 FR 4192, program section 2(a)(2):

• A $1,000 ceiling. Eligibility "is conditioned on the amount of Lost Earnings on the delinquent participant contributions or loan repayments being $1,000 or less (excluding any excise tax amounts paid to the plan under the related class exemption PTE 2002-51)."
• A 180-day speed limit. The money "must have been remitted to the plan within 180 calendar days from the date of withholding from participants' paychecks or receipt by the employer." A delinquency discovered at year-end audit is often already past this window.
• The calculator, from an earlier start date. The SCC "mandates the use of the online calculator" and measures lost earnings from the date of withholding or receipt, an earlier and more expensive start than the full application’s earliest-segregation date. The program calls this out as a deliberate design choice.
• A penalty-of-perjury statement. Each plan official seeking relief certifies, under penalty of perjury, not being under investigation and the truth of the submission. Neither path is open at all while the plan or the corrector is "Under Investigation" as the program defines it in section 3(b)(3).

(All from 90 FR 4192, read 2026-08-25.)

The excise tax splits three ways

The related class exemption, PTE 2002-51, was amended the same day (90 FR 3667, January 15, 2025). Its section I lifts the tax itself for program users:

“The sanctions resulting from the application of Code section 4975(a) and (b), by reason of Code section 4975(c)(1)(A) through (E), shall not apply to the following eligible transactions described in section 7 of the Voluntary Fiduciary Correction (VFC) Program, as amended, provided that the applicable conditions set forth in sections II, III, and IV are met”

The conditions differ by path. A full applicant must notify interested persons within 60 calendar days of the application, with a copy to the EBSA regional office, unless the otherwise-due excise tax is $100 or less, in which case paying that amount to the plan with Form 5330 documentation substitutes for notice. An SCC self-corrector never sends the notice: section IV.D instead requires paying "the amount of the excise tax that otherwise would be imposed by Code section 4975" to the plan, allocated to participant accounts like plan earnings, with a completed Form 5330 or equivalent documentation retained and a copy to the plan administrator. Outside the program there is no exemption: the tax is computed on Form 5330 (rev. December 2025) and paid to the IRS, 15% of the interest-based amount involved for each year or part of a year until correction.

One limitation died in the 2025 amendment: the exemption was historically unavailable to anyone who had used it for a similar transaction within the previous three years, and the Department eliminated the three-year limitation, saying it will monitor how frequently fiduciaries rely on the program instead.

The three paths in one table

What this comparison cannot decide for you

Whether the disclosure of a full application is a cost or a benefit depends on facts this page cannot see: an item large enough to fail the SCC’s cap is an item EBSA can already see on the plan’s public filings, because line 4a discloses it with the amount, every year it stays open. Sponsors weighing “correct quietly outside the program” against “apply and get the letter” sometimes believe the failure is private. It is not; whether your plan’s own filings already report it is public record, readable by EIN at planremit.com/check. This page also covers delinquent participant contributions only: the program’s other eligible transactions have their own conditions.

Sources

Voluntary Fiduciary Correction Program, 90 FR 4192, January 15, 2025, effective March 17, 2025, read 2026-08-25. Amendment to PTE 2002-51, 90 FR 3667, January 15, 2025, read 2026-08-25. Instructions for Form 5330, rev. December 2025, read 2026-08-25. All quotes verbatim from those texts.