Newsday reports that the IRS will examine traditional pensions, 401(k) plans and profit sharing plans, looking for those that cheat workers or the government, or that are not in compliance with federal regulations.
Under the examination process, IRS agents will review the pension plan documents of each company being examined to make sure they are up-to-date. According to Newsday, the agents will then focus on whether employers are properly handling various duties including:
- notifying workers of their eligibility to join the plans;
- matching employee contributions to 401(k) plans;
- calculating traditional pension benefits;
- investing retirement plan offerings;
- vesting workers; and
- distributing benefits at retirement.
Bob Henn, the IRS’ Northeast area manager for employee plans, told Newsday that instead of looking at all aspects of a company’s plan, the agents will focus on the plan’s documents, its internal controls and a few other key issues.
Sy Goldberg, an attorney who is a member of the IRS’s Northeast Pension Liaison Group, believes a lot of companies will not be in compliance. “They may not have good advisers, who may not file the forms correctly or bring in the employees correctly,” he told the newspaper.