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.

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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