Filed for penalty relief for failure to file 5500 years 2013-2020 . IRS says 2013-2015 not eligible for relief ?

I paid the 1500.00 fee and filed for penalty relief for not filing ez 5500 from year 2013-2020 in august 2022.On 11/21/22 I got cp283 letter from IRS for tax year 2013,2014 and 2015 that says I owe 150k penalty for each of these years.  I had called IRS and he kept putting me on hold to see if I was eligible for a " referral " whatever that means which I wasn't. All they could tell me was that those years were not eligible for form ez 5500. He gave me a fax number to EP Accounts and said I could ask for forgiveness for reasonable cause.

On tax year 2023-2015 5500 i wrote in red ink at top "Delinquent Return Filed under Rev. Proc. 2015-32, Eligible for Penalty Relief" because there was no box d to check. Is it possible that they just didn't pay attention to this and that is why they told me they are not eligible for penalty relief? Is my only recourse now asking for an abatement for those years? I can't get through to IRS to ask additional questions. Should I assume this is the issue and fax a copy of tax year 2013-2015 to EP Accounts. Due date is 12/21/22 if that makes any difference.

Did you have covered employees those years? In which case you were supposed to file form 5500 or 5500-SF instead of 5500-EZ which would be filed under a different late filer program through the DOL.

Or were you 1 person plan but your assets were less than the amount required to have to file the form those years? If so, then you would have reasonable cause to get the penalties waived as the returns were not required.

I'm unclear why they would tell you those years are ineligible.

One person plan I am a sole proprietor.Assets were over 250k starting in 2013.Is it possible this is happening because the ez 5500 forms for 2013-2015 do not have box D to check ( If this return is for the IRS Late Filer Penalty Relief Program) and therefore you are instructed to write on top of 5500 in red ink "Delinquent Return Filed under Rev. Proc. 2015-32, Eligible for Penalty Relief" which I did but they just didn't notice it ?

Update.I was able to get through to someone at IRS today who confirmed they had received 5500 for all years under penalty relief 2013-2020 but was unable to verify why years 2013-2015 were deemed ineligible but she  did make a " referral " to IRS EP Accounts for resolution.She was very helpful said I will get a 3064c letter within 30 days with a determination and if adverse I then could apply for abatement however she did make a comment that doing this referral to ep accounts dept was a little like poking a bear which concerned me a little bit.I assume I can be optimistic about getting this referral to IRS ep accounts dept.?

2 hours ago, supernole said:

I assume I can be optimistic about getting this referral to IRS ep accounts dept.?

Unless there's something else we don't know about, I would be optimistic.   For one, they are applying the post SECURE Act penalty to 2013-2015, which is wrong.  It also appears that you filed for relief prior to getting the CP283, so you should be eligible to correct those years.

1 hour ago, RatherBeGolfing said:

Unless there's something else we don't know about, I would be optimistic.   For one, they are applying the post SECURE Act penalty to 2013-2015, which is wrong.  It also appears that you filed for relief prior to getting the CP283, so you should be eligible to correct those years.

Thanks for your and others here input on this..I did mention I had called IRS about 30 days ago when i first got the CP notices before i had a theory as to why they deemed 2013-2015 ineligible and the IRS agent I spoke with  kept putting me on hold checking  with higher ups if i qualified for a " referral" to ep accounts and he finally came back and said years 2013-2015 were not eligible for penalty relief .The difference today when I spoke to different IRS agent is I was able to explain to IRS agent what i thought was the reason 2013-2015 were deemed ineligible and she was able to refer this to ep accounts. I just hope being shot down the first time for referral doesn't effect the referral i was granted today.

I had a similar issue with a client. Filed 2009-2020 and client got a penalty for 2011 10 months later. Faxed in the forms and have not heard back yet (roughly 3 months with no response). 

Update After enduring the stress for almost a year of getting letters from IRS saying we are working on your case but in the meantime pay us 150k for each year from 2013-2015 plus thousands more in additional interest  each month i received a 3064c letter saying no further action  is to be taken  for tax years 2013-2018.The problem is my penalty relief request was for 2013-2020.I have not  received any previous CP notices about 2019-2020- only 2013-2015 were an issue. Should i be concerned about this? Years 2013,2014,2015,2016,2017,2018,2019,2020 were noted separately on penalty relief transmittal however on the 1500.00 check i put check was for penalty tax relief year 2013-2020.Not sure if not listing each year separately on check would cause an issue.