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We are taking over a 401(k) plan from a payroll vendor.

The client did not file 2009 5500 until mid December. Client included a letter explaining the difficulties with the EAST2 system that was clearly supplied by the former tpa:

"This filing was delayed due to the following difficulties with the electronic filing system......"

Then listed network, error message, and other problems.

So this clearly was NOT a DFVC filing.

Now IRS sends a letter proposing a $1500 penalty for the late filing.

2 questions:

Does anybody know if there is a way to find out if DOL accepted the reasonable cause and is not going to penalize? It makes a difference as to IF there should be a DFVC filing

If the client sends a reasonable cause letter to IRS, and it is rejected, can they still get relief with DFVC

Don't you love competing agencies who barely communicate?

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