IRS Sends Questionnaires to Colleges and Universities Re Their 403(b) Plans

Courtesy of the E is for ERISA blog comes news that the Internal Revenue Service has launched a pilot project to give colleges and universities the opportunity to identify and correct problems in their 403(b) retirement plans.

IRS’ Employee Plans Compliance Unit is in the process of sending over 300 written questionnaires to a random sample of small, medium, and large institutes of higher education, including private and public colleges, universities, and trade and vocational schools.

The questionnaire – on IRS Form 886-A – contains 18 separate questions but mainly focuses on one issue: whether the organization’s Section 403(b) plan satisfies the “universal availability” (UA) requirement. Under that rule, if one employee has the opportunity to defer a portion of salary under the plan, then generally all employees must be offered the same opportunity.

According to an excerpt from the IRS webpage describing the project:

“The information gathered from this project will ultimately result in a report issued by the IRS describing responses and identifying  areas where additional 403(b) education, guidance, and outreach is needed and how we can focus enforcement efforts to address and/or avoid non-compliance in UA and new plan document requirements for organizations involved in higher education.”

Read more here.

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