Late Form M1 Filings for MEWA

[5500Nerd]

I have a client that has had a MEWA since 2008. They never filed the Form M1. They wanted to know of examples of penalty fees others have faced in similar situations on filing Form M1s late. Any input would be greatly appreciated. The DOL will only state what could happen on the fees. Many thanks for your help.

[Sabrina1]

Our firm filed 2006-2013 late M-1's in 2015 with a reasonable cause letter.  No penalties have ever been assessed.

[5500Nerd]

Thanks so much for this insight. I greatly appreciate your help.

 

[MJC]

@Sabrina1 - Did you submit the reasonable cause letter through the mandatory electronic M-1 filing system? If so, how? If not, can you provide details on how you submitted it? Thanks. 

[Jayh]

I would appreciate any advice on how to proceed with a client that unitentially formed MEWA in 2006 - family business with 5 stores owned by 2 families - with common ownership of only 10%. 

[Ron Snyder]

Jayh - Your latest post is unrelated to the current thread and should have been posted under a new thread.

How to proceed is a question which cannot be addressed without additional information.  Do they share a self-funded health plan?  Or some other type of welfare benefit plan?

They will need legal representation to devise a strategy, and probable will need to consider state law considerations (since the DOL has allowed states to regulate MEWAs) as well as ERISA considerations.  Some states specifically allow such 2-employer plans and do not make them go through all of the MEWA filings.

I believe that step 1 should be to get them out of the untenable situation they are in ASAP.  There are multiple ways this could be accomplished.  Step 2 is to make a decision on what to do about being out of compliance for 10+years.  If this was never offered to the public, the authorities will likely have a major concern other than having them cease and desist from violating the law. There will likely be some penalties imposed by the EBSA.  Some non-attorney advisers would suggest deep six-ing the whole thing and hope not to get caught.