A new IRS rulebook for fixing retirement plan mistakes went into force on October 22, 2026. It lets an employer correct certain plan errors on its own, without paying the IRS a fee, and a paycheck contribution that never reached an employee’s account is one of the errors it covers. The change matters most to workers in 401(k) and similar plans, because the fix is done by the plan sponsor, not the employee.
The question for anyone who has noticed a missing deferral on a pay stub is who can repair it and by when. The IRS procedure answers that for the employer side, and it leaves the employee with a clear thing to ask for.
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What took effect on October 22
Treasury and the IRS announced the change in release IR-2026-126. It says Revenue Procedure 2026-34 is effective on the release date, October 22, 2026, and that it expands the Employee Plans Compliance Resolution System, known as EPCRS.
EPCRS is the IRS system plan sponsors use to fix errors and keep a plan’s tax-favored status. The IRS says it includes three programs: the Self-Correction Program, the Voluntary Correction Program and the Audit Closing Agreement Program. The release says they cover qualified plans, 403(b) plans, SEP arrangements and SIMPLE IRA plans.
The new procedure replaces Revenue Procedure 2021-30 as the IRS’s current statement of the system. The IRS lists Revenue Procedure 2026-34 on its correcting plan errors page as current guidance, with the October 22 date. The text of the procedure says its changes come mainly from sections 301(b), 305 and 350 of the SECURE 2.0 Act and from three IRS notices.
The IRS release quotes IRS Chief Executive Officer Frank J. Bisignano: “Hard working Americans will benefit from these procedures.”
How a missed contribution gets fixed
The route for most missed contributions is the Self-Correction Program, which the IRS describes as a way to fix many plan errors without contacting the agency or paying a fee. The IRS page on the program defines an operational error this way: “An operational error occurs when you don’t follow the written terms of the plan.”
A paycheck deferral that an employee elected, and that the payroll department never sent to the plan, fits that description. So does an eligible worker who was left out of a plan altogether. The text of Revenue Procedure 2026-34 says an operational failure is one that “arises solely from the failure to follow plan provisions.”
For an employee left out of a plan, section 6.04 of the procedure says the employer is permitted to make certain contributions on behalf of the excluded employee. The correction methods are set out in the procedure’s appendix. Section 6.02 adds that a failure is not corrected unless full correction is made for all participants and all years affected.
The timing and the employer payment
Missed elective deferrals are usually repaired with a corrective employer contribution, which the procedure calls a qualified nonelective contribution, or QNEC. Section 2.02 of the procedure says a reduced QNEC for an elective deferral failure must be completed by the last day of the third plan year following the plan year in which the failure occurred.
The IRS program page gives a similar window for larger mistakes in 401(k), profit-sharing and 403(b) plans. It says a significant operational error should be corrected before the end of the third plan year after the failure occurred, or the plan must be substantially corrected within a reasonable time. Insignificant errors can be corrected at any time.
The procedure also carries a change for plans that sign workers up automatically. It reinstates the SECURE 2.0 safe harbor that allows a fix for automatic enrollment or automatic escalation failures without a QNEC, and extends it to SEP and SIMPLE IRA plans and to former employees.
Where self-correction stops
Self-correction has limits. The procedure says a plan sponsor must have established practices and procedures that meet its standards, and the failure must be inadvertent. Failures that are egregious, that involve diversion or misuse of plan assets, or that relate to abusive tax avoidance transactions are excluded.
Section 5.02 states the rule on audits plainly: “In general, if the plan or Plan Sponsor is Under Examination, SCP and VCP are not available.” Once an examination begins, correction runs through the IRS instead.
A sponsor that wants IRS approval can still go to the Voluntary Correction Program and pay a limited fee before an examination starts, according to section 1.03. That route exists for errors that do not qualify for self-correction.
The separate IRA correction program
The same IRS release announced a second procedure, Revenue Procedure 2026-33, which creates the IRA Compliance Resolution System. It is aimed at IRA custodians and owners dealing with certain inadvertent failures caused by service-provider errors, and it is modeled on EPCRS.
The IRA program is not in force yet. The IRS says it is effective May 1, 2027. The release adds that requests to waive the 60-day rollover deadline, now handled as private letter ruling requests, will move into the new system over 2027 and 2028, and the existing automatic waiver and self-certification procedures remain available at no cost.
What an employee can ask the plan
The procedure puts the repair in the hands of the plan sponsor, so an employee who spots a gap has no form to file with the IRS. The practical step is a written note to the employer’s benefits or payroll office that names the pay dates, the amounts withheld and the amounts that reached the account.
The employer then decides whether the fix belongs under self-correction or the voluntary program. The IRS release does not put a dollar figure on what households could recover, and it does not say how much any one worker would receive.
Who fixes a missing 401(k) contribution, and how long can the plan wait?
A missing deferral is easy to miss and costly to leave. Under the IRS procedure the repair has a timing window that runs by plan year, and an employee who never notices the gap may lose years of growth before anyone acts.
The Retirement Money Spreadsheets give a worker a place to put the real numbers. They include a Retirement Paycheck workbook that shows what savings can pay each month, and a Retirement Budget that lays out every bill, monthly and yearly, with yellow boxes for your numbers and the math already done.
This article was produced with AI assistance and edited for accuracy against the sources linked above.
