retirement plan audit pilot program

IRS Announces Pre-Exam Retirement Plan Audit Pilot Program

June 23, 2022
 / 

Share this Post

A new pre-examination retirement plan audit pilot program will potentially give Plan Sponsors a 90-day window to review their plan documents.

A new IRS retirement plan audit pilot program will provide advance notice of an upcoming plan audit, a 90-day review period to self-correct errors, and reduced fees for found errors that are not eligible for self-correction. Plan sponsors have every reason to hope this pilot program achieves its objectives and becomes part of audit protocols going forward.

The information below is the announcement published on June 5, 2022, by IRS Employee Plans. It is important to note that the presence of IRS material does not constitute or imply the endorsement, recommendation, or favoring by the IRS of any opinions, products, or services offered by the sponsor of this webpage or document.

The retirement plan audit pilot program commenced upon announcement, but at this time, no ending date has been identified.

Be sure to also view the Fulcrum Partners NQDC Audit Webinar with Steve Broadbent: “IRS Audits and the NQDC Plan.”

New 90-day Pre-Examination Compliance Pilot

From “IRS Employee Plans”:

The IRS Employee Plans function is piloting a pre-examination retirement plan compliance program beginning in June 2022. This program will notify a plan sponsor by letter that their retirement plan was selected for an upcoming examination.

The letter gives a plan sponsor a 90-day window to review their plan’s document and operations to determine if they meet current tax law requirements. If you don’t respond within 90 days, we’ll contact you to schedule an exam.

If your review reveals mistakes in the plan’s documents or operations, you may be able to self-correct these mistakes using the correction principles in our voluntary compliance program (EPCRS*), described in Revenue Procedure 2021-30.

If you find mistakes during your review that aren’t eligible to be self-corrected, you can request a closing agreement. We’ll use the Voluntary Correction Program fee structure to determine the sanctioned amount you pay under a closing agreement. 

The IRS will review your documentation and determine if we agree with your conclusions and that you appropriately self-corrected any mistakes. We’ll then issue a closing letter or conduct either a limited or full scope examination.

Our goal with this program is to reduce taxpayer burden and reduce the amount of time spent on retirement plan examinations. At the end of this pilot, we’ll evaluate its effectiveness and determine if it should continue to be part of our overall compliance strategy.

*The Employee Plans Compliance Resolution System (EPCRS) 


This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. Any tax advice contained herein is of a general nature. You should seek specific advice from your tax professional before pursuing any idea contemplated herein.

Securities offered through Lion Street Financial, LLC (LSF) and Valmark Securities, Inc. (VSI), each a member of FINRA and SIPC. Investment advisory services offered through Lion Street Advisors, LLC (LSA) and Valmark Advisers, Inc. (VAI), each an SEC registered investment advisor. Please refer to your investment advisory agreement and the Form ADV disclosures provided to you for more information. VAI/VSI and LSF/LSA are non-affiliated entities and separate entities from OneDigital and Fulcrum Partners.

Unless otherwise noted, VAI/VSI, LSF/LSA are not affiliated, associated, authorized, endorsed by, or in any way officially connected with any other company, agency or government agency identified or referenced in this document.

Lion Street Advisors // Lion Street Financial

Share this Post