Thursday, October 13, 2016

Updated plan correction procedures, extension of temporary nondiscrimination relief

Updated procedures for correcting plan errors – highlights of the new revenue procedure for the Employee Plans Compliance Resolution System (Rev. Proc. 2016-51)
Extension of temporary nondiscrimination relief for closed defined benefit plans through 2017 under certain conditions (Notice 2016-57)
Deadline extended to Dec. 5 to submit comments on Form 5500 modernization proposals
IRS Compliance Questions on the 2015 and 2016 Form 5500-Series Returns – list of questions plan sponsors don’t need to answer for the 2015 and 2016 plan years
Updated IRS Checklists for Retirement Plan Documents – used by IRS employees to review plans that apply for a determination letter during the third Cycle A, due January 31, 2017
Employee Plans Compliance Unit (EPCU) projects:
  • SIMPLE IRA Plans - Eligible Sponsors asked for information from sponsors who appeared to have more than 100 employees earning $5,000 or more
  • Partial Termination in plans that have a 20% or more decrease in participation and must fully vest affected employees
  • Ineligible Employer – 403(b) Project –  designed to educate IRC Section 501(c)(3) organizations whose tax-exempt status had been automatically revoked per IRC Section 6033(j) to ensure that an employer eligibility failure had not occurred in the sponsoring of an IRC Section 403(b) plan

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