Are You Ready?

By John Iekel • September 07, 2017 • 0 Comments
Hurricanes, epic floods, wildfires… we seem to be awash in natural disasters. They pose many dangers and risks, including the threat they can pose to a retirement plan — and, ultimately, its participants and their dependents.

There are steps that plans, employers, service providers and administrators can take to protect plans and those whom they serve. The IRS on Sept. 6 in IR-2017-145 provides some tips that could help in protecting plans and those for whom they exist from the effects of a natural disaster. The Department of Labor (DOL) also provides information and suggestions.

Following are some suggestions regarding preparations that can be taken that are relevant to retirement plans.

Create Electronic Copies of Key Documents. Keep a duplicate set of key documents, including bank statements, tax returns, identifications and insurance policies in a safe place. Store them in a waterproof container and away from the original set. Documents that are only provided on paper can be scanned into an electronic format and downloaded into an external hard drive or flash drive, as well as burned onto a CD or DVD.

Check on Fiduciary Bonds. Employers that use payroll service providers can ask providers if they have a fiduciary bond in place that could protect the employer if a payroll service provider defaults.

Update Emergency Plans. It may be too late to do so for a current or impending situation, but it is possible to do so in advance of the next one.

Information Available from the IRS. Back copies of previously filed tax returns and all attachments, including Forms W-2, can be requested by filing Form 4506, Request for Copy of Tax Return. In addition, transcripts showing most line items on these returns can be ordered by:

  • calling 800-908-9946;

  • using Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript; or

  • using Form 4506-T, Request for Transcript of Tax Return.

Information Available from the DOL. The DOL’s Employee Benefits Security Administration (EBSA) will provide assistance to plan participants when it is impossible to contact the plan administrator, the employer, plan trustees or personnel departments. Assistance is available from DOL benefits advisors electronically at or by calling 1-866-444-3272.

EBSA also provides FAQs concerning how retirement plans and participants can respond when a disaster has happened, and how plan participants may obtain assistance.

Plan Loans. EBSA reminds that federal law does not require a plan to provider plan loans, and that a participant can take a plan loan only if the plan has a loan program. It also includes reminders concerning the consequences and potential downsides of taking a plan loan.

Disaster Declared. If the federal government has declared an event a disaster or a place to be a disaster area, affected taxpayers can call 866-562-5227 to speak with an IRS specialist trained to handle disaster-related issues.