DFVCP applicable if IRS contacted client re no 5500 filed?

[Anonymoose]

A client was notified by IRS that no 2011 and 2012 Forms 5500 had been filed for their 401(k) Plan. Due to an employee change within the client's company, the 5500s were not filed, although they had been prepared. Upon receipt of the IRS notice, client filed the delinquent 5500s. Then client calls us asking what can be done about IRS penalties assessed. Is it too late to use the DFVC Program to avoid the IRS penalties? Will the program now only relieve them of DOL penalties?

[Flyboyjohn]

IRS notice requests a reply with an option to select "thanks for letting us know, we're filing under DFVCP".

How did client respond to IRS?

I'd be inclined to immediately refile the delinquent 5500s checking the DFVC box, pay the penalty and send an "amended" response to IRS with the DFVC confirmation numbers.

[ESOP Guy]

I have done what Flyboyjohn suggested exactly once and it worked. The IRS did not apply any penalties. I get the impression that part of the IRS is more interested in getting people to file then raising revenue. However, since I have only done it once I don't know if it is a pattern.