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IRS Audit Trends & Issues for Benefit Plans

February 26, 2013



Continuing our series of posts reporting on the recent TE/GE meetings, today we focus on the audit trends and issues that the IRS officials in attendance identified.  In addition to providing insight on the IRS’s focus, the list serves as a good compliance checklist for plan sponsors.  Are you making these errors?  If so, you can (and should) fix them now before the IRS comes knocking.

Areas of Focus. At the outset, it’s helpful to know where the IRS is looking for trouble, so you can have some idea where agents are coming from when you get the dreaded audit letter.  The officials at TE/GE gave these insights:

  • Most audits are focused on 3 or 4 particular issues depending on the market segment (i.e., the business of the employer) and the size of the plan (generally less than 100 participants is a

IRS St. Louis Workshop for Small and Mid-sized 501(c)(3) organizations

February 13, 2013


The following is a great opportunity to hear directly from IRS agents that specialize in tax-exempt organizations.  I have attended this event in the past and found it useful and informative.  This is a good event for 501(c)(3) directors, officers, leadership and staff.

Back by popular demand! IRS Workshop for Small and Mid-sized 501(c)(3) organizations Tuesday, April 30, 2013 9:00 a.m. to 4:00 p.m. J.C. Penney Conference Center – University of Missouri – St. Louis

$45 before April 1, 2013 | $55 after April 1 | $70 at the door

Instructors: IRS staff As every 501(c)(3) organization knows, IRS rules and regulations are stringent and ever-changing. Attend this special, low-cost workshop to hear directly from the IRS about the benefits and responsibilities under501(c)(3) and actions that may jeopardize the tax-exempt status of an organization.

Other topics will include:

  • The definition of unrelated business income, including common examples and exceptions, filing requirements

IRS Exempt Organization Newsletter 2013-3

February 11, 2013


On February 8, the IRS released its Exempt Organization Newsletter, Issue Number 2013-3. Topics include the following

  • Recent changes affecting Type III Supporting Organizations
  •  2012 tax year 990-series forms, schedules and instructions are available
  • Automatic Revocation of Exemption List
  • New webpages give a guided tour through the Examination process
  • Read the Catalog of IRS Exempt Organizations Products & Resources
  • Review upcoming dates and locations for EO workshops
  • ALERT: PTIN System is open
  • Team Lawyers Named Best in America 2013

    February 6, 2013


    The Best Lawyers in America, the oldest lawyer-rating publication in the U.S., has selected 156 Bryan Cave lawyers for inclusion in the 2013 edition.  Selection is based on a peer-review in which leading attorneys cast almost 4.4 million votes on the legal abilities of other lawyers in their specialties.

    Included in the rankings are the following attorneys from the Nonprofit, Religious, and Charitable Planning Team:


    Frank McGaughey

    Colorado Springs:

    Stuart J. Lark

    John R. Wylie

    Richard R. Young

    Kansas City:

    Gino Serra

    New York / Washington DC:

    John Barrie

    St. Louis:

    Brian Berglund

    Kathy Sherby

    Lisa Van Fleet

    Frank Wolff

    Proposed Contraceptive Compromise Rule Released

    February 5, 2013



    Continuing what has become a habit of Friday afternoon rule issuances, the Departments of the Treasury, Labor, and Health and Human Services issued a proposed rule last Friday to attempt to accommodate the objections of religious employers to the contraceptive mandate.  The rule makes a few accommodations to the prior guidance.

    • § First, the definition of “religious employer” (i.e., an employer entirely exempt from the mandate) has been expanded by eliminating the 3 prior requirements, which resulted in widespread objections:  that the organization (1)  have as its purpose the inculcation of religious values, (2) primarily employ persons who share its religious beliefs, and (3) primarily serve persons who share its religious beliefs.  Under the new proposal, a “religious employer” must be described in Code section 6033(a)(3)(A) (i) and (iii), which refer to churches, their integrated auxiliaries, conventions and associations of
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