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Help! Filed 5500-EZ late, received CP 283 with a huge penalty.


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Please help. My wife and I run a small business with no employees.

We save as much money as we can in a one-participant 401k plan that is now required to file a Form 5500-EZ each year by July 31 as it has accrued over 250k in assets for myself and my wife.

We had a tough year this year and with everything going on we filed our Form 5500-EZ a few weeks late, hoping it would not be a big deal. We received a CP 283 notice with an enormous penalty that would be a real financial hardship for us.

I understand that, having received a CP 283, we're no longer eligible for penalty relief under for Rev. Proc. 2015-32. Do you think there is some way we could try to file an amended return to still be eligible for this relief?

Is there a way to beg for some kind of one-time abatement of penalties? If we're in the grey-area of "reasonable cause" due to personal issues is there anything we can do to be more likely to get relief? By phone or by mail? Talking to multiple agents?

If the due date for the fine without interest is coming up, but we haven't figured out how to get abatement yet, is it better to pay the penalty and hope it gets refunded later, or incur interest if that makes it any more likely to be able to eventually be able to reduce the penalty?

Thank you all so much for your help and advice.



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This may help you https://www.irs.gov/individuals/understanding-your-cp283-notice  Did you file for an extension? - I assume not since you received a CP283.  I don't think personal issues is reasonable cause though. It's not that hard to file it timely. 

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8 hours ago, Bri said:

If your taxes were on extension, you might be able to rely on that extension to also extend the 5500 deadline.  In that case you could tell the IRS you neglected to check that box on the 5500.  (But it's gotta be true, of course!)

Our personal and business taxes were on extension for longer than the 5500-EZ was late.

Per the Form 5500-EZ instructions, I had just needed to check "automatic extension" and been all set. I will try to write a reasonable cause letter with this logic as part of the justification.

Thank you for this suggestion!


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  • 2 months later...

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