As a plan sponsor being investigated by an Internal Revenue Service (IRS) agent, there is one thing you might not be aware of. The IRS agent is there to ensure there has been voluntary compliance by you to the provisions of the Internal Revenue Code.
That means the IRS agent has a half-empty view, they are “pessimists” at heart. If you don’t have the requested loan documents or the last restatement, they take the position that it was never done. If you don’t have a restated plan document since 2002, they are not going to take your word for it. They can’t.
That’s why it’s necessary for you to keep good records because there is nothing worse than getting penalized for something you did.