ASPPA GAC Files Comment Letter on Proposed Form 5500 Changes

By Craig Hoffman • February 25, 2015 • 0 Comments
ASPPA’s Government Affairs Committee (GAC) recently filed comments with the IRS regarding proposed changes to IRS Form 5500. The comment letter was in response to a proposal published in the Dec. 23, 2014 Federal Register. Under the proposal, new questions will be added to the form and/or its schedules for plan years beginning in 2015. For the few plans still eligible to file paper forms, the questions will be included on a new schedule, Form 5500-SUPP.

Some of the modifications being proposed include:

  • providing trust information (EIN, name of trust, name of  trustee and trustee’s phone number) will be made mandatory;
  • plan document questions will be added related to whether the plan has been amended for law changes, the date of most recent amendment and the date of the most recent determination letter or opinion or advisory letter information for master and prototype and/or volume submitter plans;
  • a question as to whether the trust had unrelated business taxable income will be added;
  • a tax-deductible ESOP dividend question will be added;
  • new questions on coverage, non-discrimination and 401(k) plan testing will be added; and
  • the “paid preparer” information will be made mandatory.  

As for making the paid preparer information mandatory, ASPPA GAC recommended that the IRS follow the model provided by IRS Form 945 (and to a lesser extent IRS Form 1120) which permits the filer (i.e., plan sponsor and/or plan administrator) to specifically authorize whether the preparer or some other designee should be contacted by the IRS for information about the return. In addition, the comment letter recommended that the public disclosure of the preparer’s name be limited by following the protocols already presently in use for “filing authors” in the EFAST2 system.

Other ASPPA GAC recommendations included making the plan document questions clearer regarding the information being requested, providing a “check box” approach for the coverage and non-discrimination information and gathering the 401(k) testing information as part of the “feature codes” collected on line 8 of the Form 5500 (line 9 for the Form 5500-SF).

ASPPA GAC has a meeting scheduled with IRS officials in May to discuss a number of issues. No doubt, the proposed changes to Form 5500 will be part of that agenda.

Craig P. Hoffman, APM, is ASPPA’s General Counsel and Director of Regulatory Affairs.