Art of the Qualified Plan Audit

Posted By Maria Hurd, CPA The SECURE Act increased IRS Late Filing Penalties for Form 5500 by how much? How can I avoid them? IRS Penalties Tenfold. That’s how much the SECURE Act (the “Act”) increased the penalty for the late filing of a Form 5500 –TENFOLD! Before the Act, the IRS could assess a … Continued

In Summary Correction for a Missed Safe Harbor Notice: If the failure to provide a safe harbor match plan notice is merely an administrative error with no consequence (the employee was otherwise informed and participating), revising procedures to prevent future lapses is sufficient. However, if the missing notice results in an eligible employee being excluded … Continued

In Summary SECURE Act Changes to RMD Age: The new rules from the SECURE Act raise the age for Required Minimum Distributions (RMDs) from 70½ to 72. Terminated non-5% owners must take their first RMD by April 1 of the year following the later of turning 72 or retiring. Five percent owners must begin RMDs … Continued

Posted by Saaib T. Uppal, CPA, QKA The IRS has announced cost-of-living adjustments that should be noted for retirement planning purposes. Below is a chart that outlines employee benefit plan limits for 2021: PLAN LIMITS RETIREMENT & SOCIAL SECURITY 2021 Limit 2020 Limit 2019 Limit Section 401(k), 403(b), 457(b) elective deferrals  $19,500  $19,500  $19,000 401(k) … Continued

In Summary Plan Error Correction Methods in EPCRS: Operational errors in retirement plans can be fixed through the IRS Employee Plans Compliance Resolution System (EPCRS) using the Self-Correction Program (SCP) for certain timely-corrected and insignificant errors, the Voluntary Compliance Program (VCP) with an IRS fee and submission for significant or specific errors, or the Audit … Continued

In Summary Nondiscrimination Tests Limit HCE Contributions: Company owners and highly compensated employees (HCEs) may not contribute the maximum 401(k) limit because of nondiscrimination tests like the ADP and ACP tests. These tests ensure that HCE contributions are not disproportionate and are limited based on the average deferral and match percentages of non-highly compensated employees … Continued

Posted by Maria T. Hurd, CPA, RPA In pandemic times, employer contributions to retirement plans are not immune to cost-cutting initiatives, as corporate cash flows and liquidity dwindle. However, discontinuing discretionary contributions does not always eliminate all employer contribution requirements, and it is important for employers to anticipate and budget for any contributions that cannot … Continued

In the 14th century epic poem the Troilus and Criseyde, Geoffrey Chaucer portrays a tragic love tale between Troilus, a Trojan warrior, and Criseyde, the daughter of a Greek fortuneteller.

As auditors, we are required to review the controls in place at a plan sponsor of a retirement plan and its service providers to assess the risk of material misstatement resulting from control risk. In doing so, we constantly evaluate the adequacy of the control structure and recommend improvements to strengthen the processes to prevent errors.

Discrimination. It’s a concept that most people don’t associate with retirement plan savings.