5500 never filed.

[Guest Melissa Winslow]

I recently came into contact with a defined contribution plan that was established in the early 1990's. Due to several communication glitches, the plan sponsor was not aware until 1999 that the 5500 related to the plan had never been filed. The sponsor would like to "come clean" with the IRS/DOL.

I once heard of a program whereby a sponsor could anonymously call the IRS/DOL to determine the best avenue for correction. Can anyone provide the phone number for such a program? Or, is there is a better way to start the correction process?

The sponsor would prefer to be proactive in the correction process rather than filing the 1999 return and waiting for a ding letter to arrive.

[KJohnson]

IRS will typically waive a penalty upon a showing of "reasonable cause". My experience is that they have been very "reasonable" on what they consider reasonable.

DOL has a delinquent filer voluntary compliance program, DFVC, which they announced in 1995. It was published in the federal register on April 27, 1995-- FR 20874. Penalties range from $1,000 to $5,000 per form depending on whether its a 5500C or 5500 and how late it is.

There was hotline number published when the DFVC program was announced (202)219-8776 but I haven't tried this recently.

[Guest bswift]

I agree with kevin, that the irs is usually fairly reasonable in determining whether the plan sponsor has reasonable cause for not filing. the dol is another matter. you'll have to pay the fee for each year going back to when the first filing was to be made. i recently asked the dol for some relief in the case of a welfare plan filing that had not been made since the mid 80s and while the dol considered it, they finally determined that they had to stick to the DFVCP. good luck