Filing delinquent Forms 5500

[Guest Sieve]

I have an individual who has never filed Form 5500, and always was subject to the EZ rules: owner-only plan, no other participants. Plan probably has been above the filing floor for 10 years or so. So, DOL's delinquent filing program is unavailable.

What are people's experiences in recent years with getting filing penalties waived/abated in these circumstances? (This has only happened to me once, about 5 years ago, with 2 Forms 5500-EZ--we did get an abatement after-the-fact.) The client will have a heart attack--and maybe me, too--if the filings are followed by penalty letters of $25,000 for each of 10 years!

[Guest BenFolds]

I haven't had any problems getting the penalties waived for late 5500-EZs as long as a beg-letter is attached with a specific request to waive the penalties. Submit all ten at once with one beg-letter (and a good explanation).

[Andy the Actuary]

Hold on, hold on. DB plan or DC plan?

The answer may differ. If DB plan real mess because life will have to be recreated (assuming no valuations performed) and there may be accumulated funding deficiencies.

[Guest Sieve]

DC.

[Andy the Actuary]

Would add to BenFold's letter that plan document was kept in compliance if the case.

The question is what is the statute of limitations on penalties for failure to file 5500? If 3 years, then might be inclined only to file for such years and not all 10.

[Guest Sieve]

I think there is no statute if there has been no filing at all. And, by the way, the plan had not been amended since TRA '86 until a few months ago, when a VCP applicaiton was made.

[Andy the Actuary]

I thought you retired from having frozen hard objects driven at your head?