An Internal Revenue Service (“IRS”) examination is typically a time-consuming and onerous process for both the IRS and the plan sponsor. For the “glass-half-full” plan sponsors, a silver lining in this difficult process is that it provides a valuable opportunity to review the plan terms and operations for compliance with the Internal Revenue Code. And at the end of the process, the IRS issues a formal letter that can be saved in the plan’s files and used to support the tax-qualified status of the plan (at least until the next audit).
But on June 3, 2022, the IRS announced a new initiative—a pilot program— that is intended to limit the duration and the resources that would otherwise be involved with a full- or limited-scope plan audit. The first-of-its-kind program takes advantage of the correction provisions set forth in Employee Plans Compliance Resolution System (“EPCRS”) (Rev. Proc. 2021-30). The pilot program is designed to streamline the retirement plan audit process by focusing on discrete issues, and to reduce the amount of time spent by both the IRS and plan sponsors on examinations.
In this TAXES – The Tax Magazine article, “IRS Rolls-Out New Pilot Program for Plan Audit,” Groom’s David Ashner, Elizabeth Dold, and David Levine explain how this new IRS process works following the IRS sending out a wave of letters under the pilot program.
To read the article, please click here.
