There will be 1,200 401(k) plan sponsors that receive a letter from the IRS telling them they have been chosen to participate in the Employee Plans Compliance Unit "compliance check" and that they must complete an online questionnaire.

A compliance check is neither an audit nor an investigation.  But, as the IRS says in the cover letter (Letter 1562-V), failing to respond or failing to provide complete information "will result in further action which could include a full examination of your plan".

If your 401(k) plan is chosen, print out the 45-page questionnaire from the IRS website and carefully consider the answers to questions before completing the online response.  You will have 90 days to complete the questionnaire.  Questions ask for information based on the 2006, 2007, 2008 and 2009 plan years, so make sure answers are consistent with the plan's Form 5500 filings for those years.  Because the IRS questionnaire warns that books and records relating to the collection of information must be retained as long as they are material to the IRS administration of this program, keep track of the sources of your answers and consider keeping a separate file.

Many of the questions ask for answers that require legal conclusions or involve admissions of plan failures or problems and ask whether they have been corrected.  To answer all the questions will take your full 401(k) "team" – your 401(k) plan staff, TPA, benefits counsel and other professional service providers.