DOL Reopens Comment Period on Proposed Amendments to PTE under VFC Program

The DOL Employee Benefits Security Administration reopened the comment period for proposed amendments to a prohibited transaction exemption that would clarify the circumstances under which relief may be provided for misconduct that is self-corrected under the DOL's Voluntary Fiduciary Correction ("VFC") Program. The DOL reopened the comment period to allow for public comment on Section 305 of the SECURE 2.0 Act of 2022, which affects the VFC Program. The comment period initially closed on January 20, 2023; comments are now due by April 17, 2023.

As previously covered, the proposal would amend Prohibited Transaction Exemption 2002-51 to (i) establish the conditions under which entities may qualify for excise tax relief for self-corrected errors and (ii) provide that email notification of relief satisfies the condition that entities must obtain a no-action letter from EBSA acknowledging an exemption. The proposal would also remove the limitation that prohibits entities from applying for similar relief more than once within a three-year period.