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Comments on the Voluntary
Fiduciary Correction Program
- Form 5500 Implications
Background: Corrections made under the
Program may require changes to previously-filed Forms 5500. For example, there may be a
need to report a prohibited transaction for a prior plan year, or to correct the value of
assets described for one or more prior plan years (as required in the correction procedure
in Section 7.D. of the Program release, dealing with improperly valued assets).
Comment: Failure to file a complete and accurate Form 5500 can result in
penalties under ERISA and the Code. The possibility of incurring such penalties will
discourage use of the Program.
Recommendation: Penalties related to Form 5500 filings should be waived where a
previously-filed Form 5500 is being amended as part of the correction process under the
Program.
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