Jump to content

Oversight of Governmental Plans


mctoe
 Share

Recommended Posts

The IRS has authority to audit the compliance of governmental 401(a) or 403(b) plans with Internal Revenue Code requirements.

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

Link to comment
Share on other sites

And if you seek information about law and enforcement beyond tax law, the second-best source (if you don't engage Carol Calhoun) is chapters 7-9 in her Governmental Plans Answer Book.

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

Link to comment
Share on other sites

But your second question needs an answer!  "Are Governmental DC".. (or DB for that matter) ... "ever audited?"  I'll add to that and ask:  Has an enforcement action by the IRS as a result of an audit of a governmental plan ever been challenged in court and maybe a judicial decision rendered?

Link to comment
Share on other sites

1 hour ago, Susan L. said:

But your second question needs an answer!  "Are Governmental DC".. (or DB for that matter) ... "ever audited?"  I'll add to that and ask:  Has an enforcement action by the IRS as a result of an audit of a governmental plan ever been challenged in court and maybe a judicial decision rendered?

Yes, we have seen governmental plans audited. The motivation to challenge IRS actions is limited by the fact that the IRS is generally willing to accept a settlement that is far less costly than disqualification (and any applicable excise taxes). 

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

Link to comment
Share on other sites

With the work I do with gov't DB & DC plans it appears to me that these plans have no fear of being subject to a "real" audit.  Also from my experience, the people (plan sponsor/administrator) overseeing these plans know full well they are not in compliance with various IRS regulations but don't seem to care because they are not going to get caught.  Just my two cents.  

Link to comment
Share on other sites

2 hours ago, mctoe said:

With the work I do with gov't DB & DC plans it appears to me that these plans have no fear of being subject to a "real" audit.  Also from my experience, the people (plan sponsor/administrator) overseeing these plans know full well they are not in compliance with various IRS regulations but don't seem to care because they are not going to get caught.  Just my two cents.  

For a long time, that was true.  Unless a governmental plan committed such egregious violations that they turned up on the front page of the newspaper, they didn't get audited.  But we're involved in one at the moment, in which the IRS is alleging violations of minimum distribution requirements.

Employee benefits legal resource site

The opinions of my postings are my own and do not necessarily represent my law firm's position, strategies, or opinions. The contents of my postings are offered for informational purposes only and should not be construed as legal advice. A visit to this board or an exchange of information through this board does not create an attorney-client relationship. You should consult directly with an attorney for individual advice regarding your particular situation. I am not your lawyer under any circumstances.

Link to comment
Share on other sites

Would agree with all of above. In my experience, doctors generally stand by other doctors, TPAs by other TPAs, lawyers by lawyers, government workers.... Well, you get the idea. But as with TPAS, doctors, etc., there are limits.

Luke Bailey

Senior Counsel

Clark Hill PLC

214-651-4572 (O) | LBailey@clarkhill.com

2600 Dallas Parkway Suite 600

Frisco, TX 75034

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...