Step 1:
One thing that concerns me most when I do a plan audit is the liability of the plan sponsor. So, in the next few posts, you’ll get information about how to reduce your exposure and liability with plan participants, the Department of Labor and the IRS. The first step is to take a look at the way the plan is structured – whether it’s brand new or has been in place for years. Read the rest of this entry »
This is Part 2 in our series Five Ways to Lose Your Tax Exempt Status.
One of the surest ways to sow discord among employees is to cause them to have a large unexpected tax bill. This type of blunder will likely get a similar response to not making payroll. The maintenance of the tax exempt status of 401(k)’s requires some effort but prompt and appropriate action will prevent an unwanted exodus of personnel. The following mentions common plan issues that have tax implications and some useful tips for staying out of trouble. Read the rest of this entry »
Issued by the AICPA Employee Benefit Plan Audit Quality Center January 15th, 2010
On January 14, 2010 the Department of Labor (DOL) issued final regulations on the Definition of Plan Assets – Participant Contributions which establishes a safe harbor period for certain employers to deposit participant contributions on a timely basis. Read the rest of this entry »
The new Schedule C will help you take a good, hard look at plan fees. The plan sponsor is obligated to ensure plan fees are reasonable. The Department of Labor (DOL) takes this obligation seriously and brought action against NFL player Michael Vick this year for allegedly violating his fiduciary duties as a plan trustee. The DOL alleges that Vick made prohibited transfers (approximately $1.35 million) from a retirement plan to pay for criminal restitution related to his dog fighting conviction.
By Michael Lawrance
The plan auditors own the audit work papers. However, if the auditors do not document the audit appropriately, then you, the plan sponsor, can be held liable. Read the rest of this entry »