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New IRS tool helps small businesses determine best pension options

The Internal Revenue Service (IRS) has created a new Web-based tool to help small business owners determine computerswhich tax-favored pension plan best suits their needs and how to keep their plans in compliance.

The  IRS Retirement Plan Navigator is intended to provide employers with an easy-to-use guide that focuses on three areas: choosing a plan, maintaining a plan, and correcting a plan.

The navigator shows that choosing and maintaining a pension plan is manageable for small businesses.

The navigator does not suggest which plan may be best for a specific employer but it does lay out the options to allow them to choose one that best fits their situations. The navigator includes a side-by-side comparison of pension plans and their requirements.

The navigator provides a checklist and suggested resources for maintaining compliance. Pension laws change frequently. Employers can minimize problems by doing a once-a-year review to ensure they maintain compliance.

The IRS also recognizes that mistakes can be made unintentionally, and many errors can be corrected without notifying the agency. The navigator offers suggested options to employers seeking to correct errors and bring their plans back into compliance.

The Web-based guide will be kept up to date as pension laws and regulations change.

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