The IRS has issued Revenue Procedure 2014-32 and Notice 2014-35 providing temporary penalty relief to retirement plan administrators that have failed to file all required Forms 5500 and 5500-EZ.
Notice 2014-35 provides relief from late filing penalties for plans of larger businesses who satisfy the requirements of the notice and the Delinquent Filer Voluntary Compliance Program (DFVCP) offered by the Department of Labor (DOL). Under the DFVCP, in order to avoid incursion of the significant penalties that may be imposed by both the IRS and DOL, a reduced penalty may be paid with the filing of all delinquent returns. A DFVCP calculator is available at: https://www.askebsa.dol.gov/dfvcepay/calculator.
Revenue Procedure 2014-32 establishes a one-year pilot program providing relief from late filing penalties for plans not subject to the reporting requirements of Title I, including “one-participant plans” covering only the business owner and the owner’s spouse, that are required to file Form 5500-EZ but have failed to do so. No penalties or other payments are required under the pilot program, however, a fee or other payment may be required if and when a permanent program is established. If your plan is a “one participant plan” that has failed to file all necessary Forms 5500-EZ, it is highly recommended that you take advantage of the penalty-free relief offered under the pilot program.
The full text of Revenue Procedure 2014-32 is available at: http://www.irs.gov/pub/irs-drop/rp-14-32.pdf.
The full text of IRS Notice 2014-35 is available at: http://www.irs.gov/pub/irs-drop/n-14-35.pdf.
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