14568-G

Model VCP Compliance Statement- Schedule 7 Failure to Distribute Elective Deferrals in Excess of the 402(g) Limit

Agency
IRS
Revision
Rev. 3-2020
Fillable fields
20
Pages
1
Official source
IRS form page
Checked
October 21, 2026
Fill 14568-G online
Page 1 of form 14568-G

Form 14568-G: Model VCP Compliance Statement, Schedule 7, 402(g) Excess Deferrals

Form 14568-G is the Model VCP Compliance Statement, Schedule 7: Failure to Distribute Elective Deferrals in Excess of the 402(g) Limit. It is for a plan that did not comply with Internal Revenue Code (IRC) Section 402(g) when participants made deferrals that exceeded specified dollar limits and the excess deferrals were not timely returned by the plan or were less than required.

The statement is completed for the plan by the applicant and plan sponsor, not by participants. Section I counts the affected participants and excess deferrals by year, Section II describes the correction, Section III explains how the failure arose and how it will be prevented, and Section IV covers the calculations enclosed with the submission.

The form says to include the plan name, the applicant's employer identification number (EIN) and plan number on each page. This page hosts the March 2020 revision. You can fill out the PDF free in your browser on this page and download it without an account.

What's on Form 14568-G

Plan identification

Plan name, EIN and plan number, which the form says to include on each page of the compliance statement.

Section I: identification of failure

A table with the calendar year (year of deferral), number of participants affected, and amount of excess deferrals distributed, excluding earnings.

Section II: proposed correction

The plan distributes the excess deferral and reports it as taxable in the year of deferral and in the year distributed, with rules for the ADP test and designated Roth contributions.

Section II: earnings

Space to describe how earnings are determined, from the end of the year in which the failure occurred through the year of correction.

Section III: administrative procedures

An explanation of how and why the failures arose and the measures that have been (or will be) implemented so they do not recur.

Section IV: enclosures

Specific calculations for each affected employee or a representative sample of affected employees.

How to fill out Form 14568-G

  1. 1

    Identify the plan

    Enter the plan name, EIN and plan number, and repeat them on each page and attachment.

  2. 2

    Section I table

    Enter each calendar year, the participants affected and the excess deferrals distributed. The form says to count affected participants separately under each year a return of excess deferrals was not made, not just in the first year of the failure.

  3. 3

    Review the correction

    Section II prints the correction method. The form says a distribution to a highly compensated employee is included in the ADP test and one to a nonhighly compensated employee is not, and that this does not apply to 403(b) plans.

  4. 4

    Describe earnings

    State how earnings are determined. Label any extra page "Section II of Form 14568-G, Description of the Proposed Method of Correction-Earnings" with the plan name, applicant's EIN and plan number at the top.

  5. 5

    Section III

    Explain how and why the failures arose and the measures taken. Label any extra page "Section III of Form 14568-G, Change in Administrative Procedures".

  6. 6

    Section IV

    Enclose the calculations. The form says sample calculations must demonstrate each aspect of the correction method proposed.

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Where it goes and how distributions are reported

Where it goes

The form says the plan sponsor encloses the calculations with this submission. The PDF does not print a mailing address or a filing deadline.

Tax reporting of the excess

Section II says the excess deferral is reported as taxable in the year of deferral and in the year distributed, and earnings are reported as taxable in the year of distribution.

Designated Roth contributions

The form says all distributions of designated Roth contributions will be reported as taxable in the year distributed, because they were already included in income in the year of deferral.

Paperwork Reduction Act

The form says to see the current EPCRS Revenue Procedure for Paperwork Reduction Act information.

Related forms

Who completes Form 14568-G?

  • Applicants and plan sponsors

    The plan sponsor completes the statement for the plan and encloses calculations for each affected employee or a representative sample of affected employees.

  • Plans with unreturned excess deferrals

    Section I describes a plan whose participants deferred more than the IRC Section 402(g) dollar limits, where the excess was not timely returned or the return was less than required.

  • 403(b) plans

    For an IRC Section 403(b) plan, the plan sponsor ensures that the appropriate insurance company or financial institution distributes the excess from the 403(b) annuity contracts or custodial accounts.

  • Not for plan participants

    Affected participants receive the corrective distributions described in Section II. The form does not ask them to complete it.

The form names the applicant's EIN and says the plan sponsor encloses the calculations with the submission. It goes to the IRS as part of the plan's VCP submission.

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Questions about Form 14568-G

Who completes Form 14568-G?

The applicant and plan sponsor complete it for the plan. The form says the plan sponsor encloses calculations for each affected employee or a representative sample with the submission.

What failure does Form 14568-G describe?

A plan whose participants made deferrals that exceeded the IRC Section 402(g) dollar limits, where the excess deferrals were not timely returned by the plan or were less than required.

How are participants counted in Section I?

The form says affected participants are counted separately under each year that a return of excess deferrals was not made, not just in the first year of the failure.

How are earnings handled?

The excess deferral is adjusted for earnings from the end of the year in which the failure occurred through the year of correction, and the earnings are reported as taxable in the year of distribution.

Is a 403(b) plan treated differently?

The plan sponsor ensures that the insurance company or financial institution makes the distributions from the 403(b) contracts or accounts, and the form says the ADP test rule does not apply to 403(b) plans.

What has to be enclosed?

Specific calculations for each affected employee or a representative sample. The form says sample calculations must demonstrate each aspect of the proposed correction method.