Short Plan Year 2015 Form 5500

[tpacpa]

I have a plan that will be officially terminated by 7/31/15 (all plan documents updated for current legislation and all plan assets distributed). Of course, this will require a short plan year 2015 Form 5500 that will be due by February 28, 2016 (without extension).

Am I reading the 2015 Form 5500 and 5500-SUP instructions correctly in that I CANNOT file the short plan year 2015 Form 5500 on the 2014 Form 5500 because the Form 5500 is not due until after December 31, 2015 (February 28, 2016)? I must wait for the 2015 Form 5500 and Form 5500-SUP to be released?

My client is in a huge hurry to be "completely done" with this retirement plan and will not want to hear that they must wait until early 2016 to file the final Form 5500. Is there not a way around this?

[chc93]

I will have the same situation. The 2014 Form 5500-SF instructions has the following....

**************************

Notes. (1) If the filing due date falls on a Saturday,
Sunday, or Federal holiday, the return/report may be filed
on the next day that is not a Saturday, Sunday, or Federal
holiday. (2) If the 2015 Form 5500 is not available before
the plan or DFE filing, use the 2014 Form 5500 and enter
the 2015 fiscal year beginning and ending dates on the
line provided at the top of the form.

**************************

So I think the 2015 Form 5500-SF final filing can use the 2014 Form 5500-SF... unless they change the instructions for the 2014 Form 5500-SF.

However, the 2015 Form 5500-SUP says that if the deadline for filing the 5500-SUP is after Dec, 31, 2015, the 5500-SUP must be filed. So, would it be OK then to file the 2015 Form 5500-SF using the 2014 Form 5500-SF, and later filing the 2015 Form 5500-SUP on paper.

edit: I didn't find instructions for the 2015 Form 5500-SF...

[Andy the Actuary]

It appears that if the plan sponsor files 250 or more "tax returns of any type" that the SUP cannot be filed. In such case, would have to wait for 2015 5500 or 5500-SF to be issued. "Tax returns of any type" are inferred to mean everything, including W2s, etc. Any agreement or disagreement?

[tpacpa]

I will have the same situation. The 2014 Form 5500-SF instructions has the following....

**************************

Notes. (1) If the filing due date falls on a Saturday,

Sunday, or Federal holiday, the return/report may be filed

on the next day that is not a Saturday, Sunday, or Federal

holiday. (2) If the 2015 Form 5500 is not available before

the plan or DFE filing, use the 2014 Form 5500 and enter

the 2015 fiscal year beginning and ending dates on the

line provided at the top of the form.

**************************

So I think the 2015 Form 5500-SF final filing can use the 2014 Form 5500-SF... unless they change the instructions for the 2014 Form 5500-SF.

However, the 2015 Form 5500-SUP says that if the deadline for filing the 5500-SUP is after Dec, 31, 2015, the 5500-SUP must be filed. So, would it be OK then to file the 2015 Form 5500-SF using the 2014 Form 5500-SF, and later filing the 2015 Form 5500-SUP on paper.

edit: I didn't find instructions for the 2015 Form 5500-SF...

My client will have to file a 2015 Form 5500, instead of a 2015 Form 5500-SF, because of a non-qualifying asset.

Strangely, the 2014 Form 5500 instructions are slightly different from the 2014 Form 5500-SF instructions. The 2014 Form 5500 instructions indicate (emphasis added):

Notes. (1) If the filing due date falls on a Saturday, Sunday, or Federal holiday, the return/report may be filed on the next day that is not a Saturday, Sunday, or Federal holiday. (2) If the 2015 Form 5500 is not available before the plan or DFE filing is due, use the 2014 Form 5500 and enter the 2015 fiscal year beginning and ending dates on the line provided at the top of the form.

I'm not sure why there is a difference between the two forms, but the Form 5500 seems to indicate to me that if the Form 5500 will be available before the filing is due (February 28, 2016), then I must wait and use the 2015 Form 5500? So, I guess I wait until February 28, 2016 (if the 2015 Form 5500 has not been issued before then) to see which form I file?

It seems to me, based on the 2014 Form 5500-SF instructions, that you may have a case for going ahead and filing the 2015 Form 5500-SF on the 2014 Form 5500-SF.

However, it appears that we will both have to file the 2015 Form-SUP if, and whenever, the IRS decides to release it for the 2015 year (either paper or electronically, depending on the applicable rules)?

All of this is a very long time to wait (5 to 7 months) to finalize all of a terminated plan's filings. If this is the case, this should really be changed. Sigh.

[austin3515]

Try entering the 2015 dates on your filing software and see if you get a validation error. As for the 5500-SUP, there is no such form so that should not enter into the equation. Frankly I do not see how it is remotely possible that that could be imposed for 2015 at this point.

It seems to me that you should be able to file the 2014 form with 2015 dates. We've done it a million times and never had any issues. If the new form is not available, use the old. I believe it to be that simple.

The following note is shown on FT's 5500 preparation site on the 2013 Form series:

Note: If e-filing a short 2014 plan year, you will need to e-file on the 2014 forms starting 1/2/2015 per the DOL.

No such message appears on the 2014 Form.

[Andy the Actuary]

Isn't the issue the 2015 5500 will have compliance questions not on the 2014 5500?. You can submit the 5500 as you suggested but then would need to complete the 5500-sup on paper if that is permissible. Recall that you must file fewer than 250 tax returns to use the 5500-sup. the 5500-sup was issued in draft form last October. I believe many practitioners are operating as if the "sup" and 5500 compliance questions will be effective for 2015 and so temper their responses accordingly. In the end, it's the client's decision how to file and the practitioner should ensure they have communicated any attendant exposure, risks, and consequences.

[chc93]

The following note is shown on FT's 5500 preparation site on the 2013 Form series:

Note: If e-filing a short 2014 plan year, you will need to e-file on the 2014 forms starting 1/2/2015 per the DOL.

No such message appears on the 2014 Form.

So if we carry the dates to the 2014 Form... the message would say "if e-filing a short 2015 plan year, you will need to e-file on the 2015 forms starting 1/2/2016". Then... I can use the 2014 Form for the short 2015 plan year if I do it before Jan 2016.

I hope this ends up being the case.

[chc93]

Isn't the issue the 2015 5500 will have compliance questions not on the 2014 5500?. You can submit the 5500 as you suggested but then would need to complete the 5500-sup on paper if that is permissible. Recall that you must file fewer than 250 tax returns to use the 5500-sup. the 5500-sup was issued in draft form last October. I believe many practitioners are operating as if the "sup" and 5500 compliance questions will be effective for 2015 and so temper their responses accordingly. In the end, it's the client's decision how to file and the practitioner should ensure they have communicated any attendant exposure, risks, and consequences.

I understand the compliance questions that would be added to the 2015 Form 5500's. But the 2014 Form 5500-SF instructions clearly allow use of the 2014 form for a short 2015 plan year if the form is not available by the filing... so unless they change the 2014 form instructions, it's possible that they let this "short period" fall through the cracks for the compliance questions? Or make you file the 5500-SUP at a later date... just another humbug...

[Andy the Actuary]

I understand the compliance questions that would be added to the 2015 Form 5500's. But the 2014 Form 5500-SF instructions clearly allow use of the 2014 form for a short 2015 plan year if the form is not available by the filing... so unless they change the 2014 form instructions, it's possible that they let this "short period" fall through the cracks for the compliance questions? Or make you file the 5500-SUP at a later date... just another humbug...

Cetainly a possibility. But wouldn't you want to cover what happens if there are no cracks?

[chc93]

I understand the compliance questions that would be added to the 2015 Form 5500's. But the 2014 Form 5500-SF instructions clearly allow use of the 2014 form for a short 2015 plan year if the form is not available by the filing... so unless they change the 2014 form instructions, it's possible that they let this "short period" fall through the cracks for the compliance questions? Or make you file the 5500-SUP at a later date... just another humbug...

Cetainly a possibility. But wouldn't you want to cover what happens if there are no cracks?

Yes... I agree with you. I think the 2015 Form 5500-SUP will have to be / should be filed if we don't use the 2015 Form 5500-SF... unless the IRS specifically says otherwise. Thanks...

[austin3515]

Yes... I agree with you. I think the 2015 Form 5500-SUP will have to be / should be filed if we don't use the 2015 Form 5500-SF... unless the IRS specifically says otherwise. Thanks...

This conclusion again is based on DRAFT instructions written almost a year ago, at a time when 12/31/2015 was 16 months away. Now it is 5 months away and not so much as a peep from the IRS. To me it seems over-the-top-cautious to even pay attention to this thing.

And because the 2015 5500 SUP does not even exist today, how could the IRS possibly go back to people who have already filed and therefore fulfiled all of their reporting obligations based on existing laws and add NEW requirements. No no no, not even the IRS. Prediction: The 2015 5500-SUP (if there is one), will exempt anyone at least who has already filed.

[My 2 cents]

Just wondering - wouldn't the sponsor of the terminating plan have filed for a determination letter anyway? Wouldn't that make a 5500 SUP form unnecessary?