Jump to content

250 steep penalty


SSRRS

Recommended Posts

Hi,

At 250 a day for late 5500, isn't that quite steep...is there a grace period? Yes, there Is the DFVCP, however tax returns allow to file a few days late with barely any penalty (relatively). Thank you for any insights etc.

Link to comment
Share on other sites

13 hours ago, SSRRS said:

Yes, there Is the DFVCP

I think you answered your own question. How many ways are they supposed to give you to fix your own mistakes?

Free advice is worth what you paid for it. Do not rely on the information provided in this post for any purpose, including (but not limited to): tax planning, compliance with ERISA or the IRC, investing or other forms of fortune-telling, bird identification, relationship advice, or spiritual guidance.

Corey B. Zeller, MSEA, CPC, QPA, QKA
Preferred Pension Planning Corp.
corey@pppc.co

Link to comment
Share on other sites

Those penalties were magnified so additional revenue could be manufactured, real or imagined, to offset the cost of SECURE (or maybe CARES). I wonder if the government tracks the actual revenue raised from these changes during the 10-year budget period versus their projections used to get the law passed.

Like pension contribution relief, which was supposed to reduce pension contributions and deductions to increase tax revenue. Who is most likely to cut back on their pension contributions? Companies losing money (so paying little or no taxes) that don't need deductions and tax-exempt NFPs that don't pay taxes - so all that did was further weaken already under funded plans which further stressed the PBGC and likely raised very little of the projected additional revenue. 

Sorry, didn't mean to go off on a rant, talk about tangents, or as my wife and I say to each other in such instance - squirrel!

Kenneth M. Prell, CEBS, ERPA

Vice President, BPAS Actuarial & Pension Services

kprell@bpas.com

Link to comment
Share on other sites

Yes the penalties are steep, some have said draconian even. But they are what they are. Don't be late and if you have to be, file under DFVCP. And don't forget I'm pretty sure the penalties accrue from the original filing due date and not the extended filing due date. So if you think you are one day late on October 18 this year, I think you are closer to 79 days late as far the IRS is concerned.

Link to comment
Share on other sites

On 10/22/2022 at 7:53 AM, thepensionmaven said:

Client filed 10/20, did not check box DFVC.  If he gets IRS Notice, Letter, whatever, can he file as an amended and go DFVC, or did he need to initially file under DFVC?

Next, is there a time limit between the filing under DFVC and actually submitting the filing and paying the fee.

Good question. I randomly ran into a potential client in nearly the same situation. My understanding is you can file DFVC  up until the point you receive a penalty assessment.

Can anyone else confirm or refute that?

Link to comment
Share on other sites

4 hours ago, Lou S. said:

Can anyone else confirm or refute that?

Sort of...  You can file DFVCP as long as you have not received a DOL notice of intent to assess a penalty.  You are still eligible for DFVCP if you receive an IRS penalty assessment. 

For the IRS late filer penalty relief program (for EZ filers), you are no longer eligible if you receive the IRS penalty assessment.  

 

 

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...