On June 2, 2014, the IRS launched a voluntary disclosure program to help small businesses come into compliance with their retirement plan filing requirements. The program applied to Plan Administrators for certain small business plans (owner-spouse), certain business partnership plans (one-participant plans), and certain foreign plans – generally those plans which require the filing of Form 5500-EZ. Plan Administrators who fail to file the annual returns can face stiff penalties up to $15,000 per return. Under the voluntary disclosure program, Plan Administrators would file a number of late returns while avoiding the penalties. The IRS recently reported that an estimated 6,000 delinquent returns have already been filed under the program.
The IRS’s program is coming to an end June 2, 2015. Plan Administrators who do not take advantage of the program by the June 2nd deadline may face the steep penalties thereafter. Attorneys can assist Plan Administrators in preparing the application and making sure that the proper procedures have been followed for participation in the program and the resulting penalty relief.
By: Sandra D. Mertens, Esq.