Summary of IRS Examinations of Retirement Plans

Article Excerpt:

During 2017, the Employee Benefit Service Group Practice of PKF O’Connor Davies, LLP represented a number of plans that had been selected for examination by the Internal Revenue Service (IRS). Our practice includes a former IRS agent and other professionals with experience in representing retirement plans before regulatory agencies. The plan year selected for review by the IRS was generally the 2015 plan year. According to the governmental agents, these plans were selected based on one of the following reasons:

  • type of organization (e.g., not-for-profit),
  • large percentage of assets reported as distributions on the plan’s Form 5500,
  • plan repeatedly reported corrective distributions [this occurs when participants have contributed in excess of the IRS dollar limit, or distributions were made from the plan to satisfy a nondiscrimination test, e.g., actual deferral percentage (ADP) test], or
  • random selection.