IRS provides permanent relief from penalties for certain late-filers of Forms 5500

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Tax Hot TopicsIn Rev. Proc. 2015-32, the IRS made permanent a program that provides administrative relief to plan administrators and plan sponsors of certain retirement plans from penalties for failing to comply in a timely way with annual Form 5500 reporting requirements.

In 2014, a temporary one-year pilot program was established to provide relief from late filing penalties for plans not subject to the reporting requirements of Title I of the Employee Retirement Income Security Act (ERISA), including “one-participant plans” covering only the business owner and the owner’s spouse, that are required to file Form 5500-EZ. Under the temporary program, no penalties or other payments were required.

Rev. Proc. 2015-32 makes this program permanent, and the permanent program generally follows the requirements of the pilot program. As with the pilot program, the relief does not apply to late filing penalties that have already been assessed. In establishing the permanent program, the IRS made certain changes to the pilot program, including the following:
  • It implemented a fee of $500 per submission for each delinquent return for each plan, up to a maximum of $1,500 per plan.
  • The delinquent submission must be made on the Form 5500-EZ that applied for the plan year for which the return was delinquent.
  • Delinquent returns for each plan must be submitted separately, and multiple delinquent returns for the same plan must be submitted in a single submission.

The permanent program under Rev. Proc. 2015-32 became effective on June 3, 2015, and all submissions on or after that date must be made in accordance with the program.

Eddie Adkins
+1 202 521 1565

Jeff Martin
+1 202 521 1526

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