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| Solo-k Plan |
The IRS provides relief from certain IRS penalties for the late filing of a Form 5500 return. Revenue Procedure 2014-32 establishes a temporary relief program for the late filing of a Form 5500EZ return for Solo-k retirement plans.
Under Notice 2014-35, the IRS will not impose penalties for a plan's late filing of a Form 5500EZ return for a year for which one of these forms must be filed,
The IRS will not impose any penalty on Solo 401k plans for delinquent filing of a Form 5500EZ return if the applicant submits to the IRS:
- A complete Form 5500EZ return, including all required schedules and attachments, for each plan year for which relief is requested. Each late Form 5500 return must be marked, in red letters at the top margin of the first page, "Delinquent return submitted under Rev. Proc. 2014-32, Eligible for Penalty Relief."
- A completed paper copy of the Transmittal Schedule provided in the appendix of Revenue Procedure 2014-32, attached to the front of each delinquent return.
Multiple Form 5500 Series returns covering several plan years can be included in a single session.
Under the new procedure, delinquent filers can submit an application for penalty relief from June 2, 2014 until June 2, 2015.
After the temporary pilot program ends, the IRS will determine whether it should install a permanent program. Unlike the pilot program, any final program will probably include a fee.
We had a client who filed his 2012 5500EZ last year without signing the form. The IRS responded after the due date that the return was unacceptable as it was unsigned. The IRS fined the plan sponsor $1800 for the failure. This new pilot program will save a lot of heartache.
Solo 401k Plan: Your Opportunity for Checkbook Control of Your Future
