Just a reminder that if your practice had a 401k/Profit Sharing Plan in place during 2020, you are required to file a Form 5500 by 7/31/21 (https://www.dol.gov/sites/dolgov/files/EBSA/employers-and-advisers/plan-administration-and-compliance/reporting-and-filing/form-5500/2019-sf.pdf). If you aren’t able to submit this paperwork prior to 7/31, please file for an extension using the Form 5558, https://www.irs.gov/pub/irs-pdf/f5558.pdf, giving yourself until 10/15 to file.
There are no taxes due with this form. Instead, the 5500 is an informational filing only. Practices with SEPs and SIMPLEs are exempt from this annual filing requirement.
While no taxes are due, the PENALTIES FOR FILING THE FORM 5500 LATE ARE DISGUSTING – A WHOPPING $250 PER DAY!!! Learn more at: https://www.irs.gov/retirement-plans/increased-penalties-for-failure-to-file-retirement-plan-returns.
As a practice owner with a retirement plan, it’s up to you to follow up with your TPA to be completely sure that all the filing deadlines are met. No one is certain how flexible the IRS will be to reduce or waive this onerous late filing penalty. Please do what you can to not need to find out.
Remember, no one cares more about your practice avoiding this $250 per day late-filing penalty than you do.