Hello,
We have a client who is purchasing the assets of a seller. In the purchase agreement, the buyer (client) has specifically excluded the welfare plans so that the client will not be purchasing the welfare plans; however, there is a transition period under which employees will remain part of the seller's welfare plans before being transferred over to the buyer's plans.
We have learned that the seller has failed to file a Form 5500 for its health plan for the past couple of years. Will our client (buyer) be at risk for DOL/IRS penalties if these delinquent Form 5500 are not corrected? I am having trouble finding sources to support whether successor liability will apply in this case. Any insight is appreciated. Thank you.
