SECURE Act Filing Penalty Q&As

The SECURE Act includes significant increases in the penalties for late filing of retirement plan returns and related notices, including to the Form 5500 penalty; failure to file a registration statement; failure to file a required notification of change; and failure to provide a required withholding notice. 

Q1: Are the penalties effective immediately? For example, if the client did not file the 2018 Form 5500 in time, will they be penalized in 2020, knowing 2019 Form 5500s are not done yet?

A1: The increased penalties are effective for forms/notices required to be filed after December 31, 2019. Thus, the penalty is based on the year it was due, not when it is filed.

Q2: Does this mean that if you amend or correct the 8955-SSA, a client will have to pay the new fee?

A2: It depends on what you mean by an amendment. If there was a mistake that was made, then it’s possible the IRS could argue there was no initial filing (if it was way off base). If information has changed, then that doesn't mean you have a late filing. And the changes are done with a new SSA (not an amendment) and address/employer information changes are handled in the 5500.

The topics addressed on this page are for information purposes only and should not be construed as specific tax or retirement plan advice. Individuals should consult a tax advisor or attorney for questions regarding specific tax or legal needs.