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Missed Restatement Penalty


JAY21
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Does anyone have any current practical experience on a late Volume Submitter amenders for GUST (just discovered a plan was missed). Has anyone recently submitted a late amender for GUST to the IRS under their closing agreement program ? (forget the revised names of these programs). I believe Rev. Proc. 2003-44 is the appropriate guidance, and I know the penalty sanction is supposed to "consider" part of what the max sanction amount would be (e.g., 40% of amount if trust was disqualified or something like that), but practically speaking, the last time we did restatements for TRA 86, it seemed like in the immediate 6 months or so after the deadline most late amenders were getting slapped with some fairly modest fees ($1,000 - $2,000) as a practical matter. Anyone have any current experience with what late Volume Submitter amenders are receiving as penalties in general currently ?

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One other point. As stated, the fee is reduced to 50% if you update within one year of the deadline. Unfortunately, if it's a GUST update, you're beyond one year. Even though most pre-approved plans had a deadline of Sept. 30, 2003, when you miss that deadline it relates back to the unextended deadline - the later of 2/28/2002 or the last day of the plan year beginning in 2001. So, for most plans the deadline was 2/28/2002 so the reduction in the sanction can't be used.

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