Compliance June 27, 2007

Committee Gives Recommendations for Pre-approved Plan Compliance

June 27, 2007 (PLANSPONSOR.com) - The Internal Revenue Service (IRS) has issued a report from the IRS Advisory Committee on Tax Exempt and Government Entities that includes recommendations for improved compliance for Master, Prototype, and Volume Submitter plans.
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According to the report, the committee’s recommendations include:

  • The distribution of a form which advises adopting employers of the responsibilities associated with these plans and includes a list of the parties responsible for performing various administrative functions on behalf of the plan;  
  • The provision of additional education, outreach and guidance to these employers regarding compliance requirements for these plans; and
  • Implementation of a permanent audit program for plan sponsors to determine levels of compliance with IRS requirements for organizations maintaining a pre-approved plan.

“Currently, the IRS estimates that at least 94% of all qualified retirement plans are Master and Prototype plans and Volume Submitter plans,” the report said. The recommendations were aimed at addressing compliance issues often seen among these plan types.

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The report said compliance issues were believed to be unintentional and due to the nature of the plan submission program.

The document can be viewed  here .

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