The IRS Employee Plans Compliance Unit (EPCU) sent a letter during the week of May 17, 2010 to 1,200 employers who sponsor 401(k) plans instructing them to complete the 401(k) Compliance Check Questionnaire. The purpose of the questionnaire is to provide the EPCU with a comprehensive look at 401(k) plans that in turn will aid in maximizing resources for education, outreach, guidance, and enforcement efforts while minimizing compliant plan sponsors’ burden.
Although not all questions apply to all plans, the questionnaire will be the same for all 1,200 employers. Topics of the questionnaire will include: demographics, participation, employer and employee contributions, top-heavy and nondiscrimination testing, distributions and plan loans, other plan operations, automatic contribution arrangements, designated Roth features, IRS voluntary compliance and correction programs, and plan administration.
The questionnaire should be completed on the secure website, and failure to do so could result in further action or examination of the plan. Visit www.irs.gov/retirement/ and click on the 401(k) Compliance Check Questionnaire link for more information.
By Greg Wallenbecker, CPA, Partner, gwallenbecker@legacycpas.com