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New Penalty Relief Program for Form 5500-EZ Late Filers

A new pilot program gives sponsors and administrators of retirement plans not covered by Title I of ERISA automatic relief from IRS late filing penalties on past due:

  • Form 5500-EZ, Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan, or
  • Form 5500, Annual Return/Report of Employee Benefit Plan, if you must file this return because your non-ERISA plan doesn’t meet the filing requirements for Form 5500-EZ for plan years before 2009.

The pilot program will be open from June 2, 2014 to June 2, 2015 (Revenue Procedure 2014-32).  No fee or other payment is required under the pilot program.

Plans eligible for relief

  • Non-ERISA plans covering only a 100% business owner or one or more partners, and their spouses (no common law employee participants).
  • Plans maintained outside the U.S. primarily for non-resident aliens (foreign plans) subject to IRS annual reporting.

Your plan isn’t eligible for relief under the pilot program for any year that your plan was subject to Title I of ERISA. Instead, you may pursue penalty relief for these years through the Department of Labor’s Delinquent Filer Voluntary Compliance Program.

Program requirements

To qualify for penalty relief, you must:

  1. Not have received a CP 283 Notice, Penalty Charged on Your 5500 Return, for the delinquent return.

  2. File the late return plus any required schedules and attachments, using the original IRS form for that year (but use only a Form 5500-EZ for 2009 and later years even if the plan could’ve originally submitted a Form 5500-SF). Annual actuarial reports for defined benefit plans need to be prepared even if they are not required to be included with the filed return.

  3. Write in red letters in the top margin of the first page above the title of the form “Delinquent return submitted under Rev. Proc. 2014-32, Eligible for Penalty Relief” on each late return that you submit (failure to do this may cause your late return to be ineligible for penalty relief).

  4. Attach a completed one-page transmittal schedule to the front of each late return.

  5. Mail (electronically filed returns through EFAST2 are ineligible for penalty relief under the pilot program):
    • Forms 5500-EZ to:
      Internal Revenue Service
      1973 North Rulon White Blvd.
      Ogden, UT 84404-0020

    • Forms 5500 to:
      Internal Revenue Service
      Employee Plans Delinquent Filer Program
      EP Classification
      9350 Flair Drive
      El Monte, CA  91731-2828

You may use the United States mail or the following private delivery services:

    • DHL Express: DHL Same Day Service.
    • Federal Express: FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2 Day, FedEx International Priority and FedEx International First.
    • United Parcel Service: UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A.M., UPS Worldwide Express Plus and UPS Worldwide Express.

Penalties waived

The plan sponsor or administrator can face late filing penalties for delinquent Forms 5500 and Forms 5500-EZ as high as $15,000 for each late return, plus interest.

Requests for comments on a permanent late filer program

At the close of this pilot program, we’re considering a permanent program, which will likely require late filers to pay a fee or other payment. We invite your comments on:

  • Whether we should establish a permanent program?
  • How should we determine fees for late filed Forms 5500-EZ and 5500?

Please send your comments by:

  • Mail to:
    CC:PA:LPD:PR (Rev. Proc. 2014-32),
    Room 5203, Internal Revenue Service,
    POB 7604 Ben Franklin Station, 
    Washington, D.C. 20044

  • Hand delivery (Monday - Friday, 8 a.m. - 4 p.m. ET) to:
    CC:PA:LPD:PR (Rev. Proc. 2014-32),
    Courier's Desk, Internal Revenue Service,
    1111 Constitution Ave., N.W.,
    Washington, D.C.

  • Email to: Notice.comments@irscounsel.treas.gov - include “Rev. Proc. 2014-32” in the subject line.

Additional resources

 

Page Last Reviewed or Updated: 15-Oct-2014