The IRS has introduced that, as a consequence of COVID-19-related backlogs, it’s suspending the issuance of sure delinquent submitting notices referring to returns filed by tax-exempt or governmental entities, together with worker profit plans. Suspended notices embrace reminder notices about Type 5500-EZ and 5500-SF submitting necessities, first delinquency notices for Type 5500 and 5500-SF, and second delinquency notices for Type 5500.
In line with the IRS, a number of million filed returns haven’t but been processed, and this suspension will assist keep away from confusion when filings are nonetheless in course of. Filers should still obtain these notices through the subsequent a number of weeks. The announcement states that there’s typically no have to contact the IRS if a discover is acquired for a return that was well timed filed. The IRS will decide when to renew sending these notices based mostly on the stock of pending returns.
EBIA Remark: Be aware that this suspension relates solely to IRS Type 5500 submitting necessities, not DOL reporting necessities underneath ERISA. Consequently, it has no impact on the issuance of failure-to-file notices originating from the DOL, plan sponsors’ capability to make use of the Delinquent Filer Voluntary Compliance Program (DFVCP), and the evaluation of DOL penalties. The IRS requirement applies solely to pension plans (together with 401(okay) plans), not welfare plans. Generally, submitting with the DOL satisfies each the IRS “annual return” and the DOL “annual report” necessities. For extra info, see EBIA’s 401(okay) Plans guide at Sections XXXI.A (“Overview of Annual Report Requirement”) and XXXI.M (“IRS Filings Associated to Type 5500”). You may additionally be serious about our upcoming webinar, “Type 5500 for Well being and Welfare Plans: Preparation and Submitting” (reside on 4/28/2022).
Contributing Editors: EBIA Employees.
