IRS Updates EPCRS May 5, 2006

IRS Posts Guide
Rev. 03/31/05, E-Mail Alert 2005-6

The IRS has posted a summary of its examination procedures for qualified plans, including audit guidelines, on its website.

IRS Issues Information on the Employee Plans (EP) Examination Process
Based on responses to its Customer Satisfaction surveys, the IRS Employee Plans division has developed new products to help retirement plan sponsors and practitioners better understand the qualified retirement plan audit process. The Employee Plans Examination Process Guide is web-based and intended as a resource to provide this information. A new IRS publication, 1-EP, Understanding the Employee Plans Examination Process , has been created to replace the Publication 1 (Your Rights as a Taxpayer) in the initial contact package.

The letter setting the audit appointment, Form 1346 , has been made friendlier in an attempt to address the #1 question raised by customers - “Why was I selected for examination?” The revised letter explains why certain returns are selected for examination. The itemized listing of information needed for the examination is organized by code section and an explanation of why the information is needed is provided.

The Employee Plans Examination Process Flowchart illustrates the steps involved in an audit of a retirement plan and provides information about how issues identified during an examination will be handled.

The Employee Plans Examination Bookmark provides a concise explanation of the rights of the employer sponsoring the plan. It also provides a reminder of the advantages and responsibilities of maintaining a retirement plan.

A “status update” letter has been developed to provide the employer and its representative with additional information when there are delays in the processing of the case. These documents are now available on the Retirement Plans Web Page and they’re in current use by the IRS’ auditors.