|
May 2003 |
|
The Delinquent Filer Voluntary Compliance (DFVC) Program is
designed to encourage voluntary compliance with the annual
reporting requirements under the Employee Retirement Income
Security Act (ERISA). The DFVC Program gives delinquent plan
administrators a way to avoid potentially higher civil penalty
assessments by satisfying the program’s requirements and
voluntarily paying a reduced penalty amount. To increase
incentives for delinquent plan administrators to voluntarily
comply with ERISA’s annual reporting requirements, the
Department further reduced penalties under the DFVC program,
and updated and simplified the rules governing participation
in the program.
|
|
On
This Page |
|
|
|
|
|
Eligibility for the DFVC Program continues
to be limited to plan administrators with filing obligations
under Title I of ERISA who comply with the provisions of the
program and who have not been notified in writing by the
Department of a failure to file a timely annual report under
Title I of ERISA. For example, Form 5500-EZ filers and Form
5500 filers for plans without employees (as described in 29
CFR 2510.3-3(b) and (c)) are not eligible to participate in
the DFVC Program because such plans are not subject to Title
I.
|
|
|
Participation in the DFVC Program is a
two-part process. First, file with EBSA a complete Form 5500
Series Annual Return/Report, including all schedules and
attachments, for each year relief is requested. Special
simplified rules apply to “top hat” plans and
apprenticeship and training plans. Second, submit to the DFVC
Program the required documentation and applicable penalty
amount. The plan administrator is personally liable for the
applicable penalty amount, and, therefore, amounts paid under
the DFVC Program shall not be paid from the assets of an
employee benefit plan.
|
|
|
Reduced per day penalty. The basic
penalty under the program has been reduced from $50 to $10 per
day for delinquent filings.
|
Reduced “per filing” cap. The
maximum penalty for a single late annual report has been
reduced from $2,000 to $750 for a small plan (generally a plan
with fewer than 100 participants at the beginning of the plan
year) and from $5,000 to $2,000 for a large plan.
|
New “per plan” cap. The revised
DFVC Program also includes a new “per plan” cap. This cap
is designed to encourage reporting compliance by plan
administrators who have failed to file an annual report for a
plan for multiple years. The “per plan” cap limits the
penalty to $1,500 for a small plan and $4,000 for a large plan
regardless of the number of late annual reports filed for the
plan at the same time. There is no “per administrator” or
“per sponsor” cap. If the same person is the administrator
or sponsor of several plans required to file annual reports
under Title I of ERISA, the maximum applicable penalty amounts
would apply for each plan.
|
Small plans sponsored by certain
tax-exempt organizations. A special “per plan” cap of
$750 applies to a small plan sponsored by an organization that
is tax-exempt under Internal Revenue Code §501(c)(3). The
$750 limitation applies regardless of the number of late
annual reports filed for the plan at the same time. It is not
available, however, if as of the date the plan files under the
DFVC Program, there is a delinquent annual report for a plan
year during which the plan was a large plan.
|
“Top hat” plans and apprenticeship
and training plans. The penalty amount for “top hat”
plans and apprenticeship and training plans was reduced to
$750.
|
|
|
The Department also simplified and updated the procedures
governing participation in the program. The changes are intended to make the
program easier to use. For example:
-
Plan administrators may use the Form 5500
for the year relief is sought or the most current form available at the time
of participation. This option allows administrators to choose the form that
is most efficient and least burdensome for their circumstances;
-
The forms and penalty payment check should
no longer be annotated in bold red print identifying the filing as a DFVC
filing;
-
The program has been updated to conform to
the annual reporting procedures under the computerized ERISA Filing
Acceptance System (EFAST); and
-
The address where DFVC Program remittances
are submitted has been changed to DFVC Program, EBSA, P.O. Box 530292,
Atlanta, Georgia 30353-0292. Submissions made to the old address will be
returned to the filer.
|
|
|
Although the DFVC Program does not cover
late filing penalties under the Internal Revenue Code or Title
IV of ERISA, the Internal Revenue Service and Pension Benefit
Guaranty Corporation agreed to provide certain penalty relief
for delinquent Form 5500s filed for Title I plans where the
conditions of the DFVC Program have been satisfied.
|
|
|
Questions about the DFVC Program should be
directed to EBSA by calling 202.693.8360. For additional information, see the Frequently Asked Questions about the Delinquent Filer Voluntary Compliance Program. For additional
information about the Form 5500 Series, visit the EFAST
Internet site at www.efast.dol.gov, or call the EBSA help desk
at 1.866.463.3278.
|
|
This fact sheet has been developed by the
U.S. Department of Labor, Employee Benefits Security
Administration, Washington, DC 20210. It will be made
available in alternate formats upon request: Voice phone:
202.693.8664; TTY: 202.501.3911. In addition, the information
in this fact sheet constitutes a small entity compliance guide
for purposes of the Small Business Regulatory Enforcement
Fairness Act of 1996.
|