Six years ago, on April 22, 2008, as a twenty-year member of ASPPA and a Director of the Small Business Council of America, I filed a Position Paper with the Internal Revenue Service TE/GE entitled, “The Time is Now to Remedy the Inequity Applied to American Small Businesses Respecting the Late Filing of IRS Form 5500-EZ.” The Position Paper set forth what I believed would be most reasonable and equitable remedy to the application of late filing penalties to “employer-sponsors” for the failure to timely prepare and file IRS Form 55–EZ. The Position Paper to the IRS can be found here: IRS Letter and Ruling.
Well, the six-year wait was well worth it! On Friday, May 9, 2014, the Treasure Department and the Internal Revenue Service published Revenue Procedure 2014-32 (“Rev. Proc. 2014-32″) announcing a “Pilot Penalty Relief Program” (the “Pilot Program”).
Rev. Proc. 2014-32 established a temporary one-year Pilot Program providing administrative relief to plan administrators and plan sponsors of retirement plans as that term is defined in the Internal Revenue Code of 1986, as amended (herein, “retirement plans”) that are not subject to the reporting requirements of Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”). The Pilot Program grants administrative relief from the imposition of failure-to-timely-file penalties imposed under Sections 6652(e) and 6692 of the Internal Revenue Code of 1986, as amended (the “IRC”) and applies only to plan administrators (as defined in IRC Section 414(g) and plan sponsors of retirement plans subject to the reporting requirements of IRC Sections 6047(e), 6058 and 6059.
Revenue Procedure 2014-32 can be found at http://www.irs.gov/pub/irs-drop/rp-14-32.pdf.
by Alex Brucker