The Value of Error Correction and IRS Audit Support
After discovering that their platform had failed to auto-enroll almost 150 participants over a period of 18 months, the plan’s sponsor contacted the platform for assistance. Their platform representative claimed it was their responsibility to correct the error, knowing it would be a costly and time-consuming endeavor. Frustrated, the client contacted our firm seeking experienced counsel.
Our team, which includes a qualified 401(k) plan administrator and an ERISA attorney, quickly got to work smoothing the situation. We contacted the platform and were able to put a correction plan in place to help ensure our client’s plan was back on audited track as soon as possible, with the least out-of-pocket costs.
Though the total cost of the correction came in close to $131,000, our firm negotiated on the client’s behalf, and we were ultimately successful in getting the platform to contribute 44 percent of the cost.
Our retirement plan team documented the entire correction process for the plan’s auditors and the plan’s records. This documentation proved to be invaluable when, 12 months later, the IRS audited the plan. Our client turned to Advus for support again, and we were ready to help.
Our on-staff Enrolled Retirement Plan Agent designee coordinated the response to the IRS and was onsite to represent the client during the audit. The IRS agent noted and commended on the thorough documentation and rigorous organization of the records, and was able to complete his onsite audit in only four hours.