Which of the following statements is TRUE regarding the Internal Revenue Service (IRS) and Department of Labor (DOL) in relation to ERISA?

Which of the following statements is TRUE regarding the Internal Revenue Service (IRS) and Department of Labor (DOL) in relation to ERISA?

• A. They both oversee compliance with ERISA.
• B. Only the IRS oversees compliance with ERISA.
• C. Only the DOL oversees compliance with ERISA.
• D. Neither agency oversees compliance with ERISA.

Answer: (A)

The correct answer is accurate because both the IRS and DOL have specific and distinct roles in overseeing compliance with the Employee Retirement Income Security Act (ERISA). The Department of Labor primarily focuses on the reporting and disclosure requirements for employee benefit plans, as well as the fiduciary responsibilities of plan sponsors and administrators. It ensures that plans are operated in the best interests of participants and beneficiaries, thus promoting the protection of employee benefits. On the other hand, the IRS plays a crucial role in enforcing the tax-related provisions of ERISA. This includes overseeing the qualification of retirement plans under the Internal Revenue Code, which provides tax benefits to employers and employees participating in such plans. The IRS ensures that these plans meet specific requirements to maintain their tax-advantaged status. In summary, both agencies collaborate to ensure that different aspects of ERISA are followed, making it accurate to state that they both oversee compliance with ERISA.

The correct answer is accurate because both the IRS and DOL have specific and distinct roles in overseeing compliance with the Employee Retirement Income Security Act (ERISA).

The Department of Labor primarily focuses on the reporting and disclosure requirements for employee benefit plans, as well as the fiduciary responsibilities of plan sponsors and administrators. It ensures that plans are operated in the best interests of participants and beneficiaries, thus promoting the protection of employee benefits.

On the other hand, the IRS plays a crucial role in enforcing the tax-related provisions of ERISA. This includes overseeing the qualification of retirement plans under the Internal Revenue Code, which provides tax benefits to employers and employees participating in such plans. The IRS ensures that these plans meet specific requirements to maintain their tax-advantaged status.

In summary, both agencies collaborate to ensure that different aspects of ERISA are followed, making it accurate to state that they both oversee compliance with ERISA.