January 20, 2021
The IRS recently issued instructions for Form 5500-EZ, a form used by one-participant plans that are not subject to the requirements of IRC section 104(a) of ERISA.
Effective for plan years beginning after 2019, a one-participant plan or a foreign plan required to file an annual return can file Form 5500-EZ electronically using the EFAST2 filing system or file Form 5500-EZ on paper with the IRS. Form 5500-SF is no longer used by a one-participant plan or a foreign plan in place of Form 5500-EZ.
As a reminder, if a plan fails to file a return, then the penalties are now $250 per day, up to a maximum of $150,000 per plan year. Returns required to be filed after December 31, 2019, are subject to these increased penalties.
Business owners covered by these plans should be aware of the increased penalties that could be imposed if they fail to file.
Instructions for 2020 Form 5500-EZ »