Employee Benefit Plan Deadlines Extended

Del YounglasCOVID-19, Featured News

Featured News

IRS Extends Some (But Not All) Employee Benefit Plan Deadlines

By: Chris Villari, Shareholder

The IRS recently issued Notice 2020-23, expanding on previously issued guidance extending certain tax filing and payment deadlines in response to the novel coronavirus (COVID-19) crisis.  This guidance applies to specified filing obligations and other “specified actions” that would otherwise be due on or after April 1, 2020, and before July 15, 2020. It extends the due date for these specified actions to July 15, 2020.

Specified actions include any “specified time-sensitive action” listed in Revenue Procedure 2018-58, including many relating to employee benefit plans.  The relief applies to any person with certain filing or other requirements due within the relief window, and is automatic — your business doesn’t need to file any form, letter or other request with the IRS.

Extension requests beyond July 15, 2020, may be sought using the appropriate form, but that extension won’t go beyond the original statutory or regulatory extension date.  Here are some highlights of Notice 2020-23 specifically related to employee benefit plans:

Form 5500. The relief window covers Form 5500 filings for plan years that ended in September, October or November 2019, as well as Form 5500 deadlines within the window as a result of a previously filed extension request.  These filings are now due by July 15, 2020.  Notably, the relief window does not include the July 31, 2020 due date for 2019 Form 5500 filings for calendar-year plans.  Those plans may seek a regular extension using Form 5558.

For example, the 5500 for a plan whose year ended October 31, 2019, was otherwise due May 31, 2020.  This return is now due July 15, 2020, and it can be extended until August 15, 2020.

Retirement plans. The extended deadlines apply to correcting excess contributions, excess aggregate contributions (based on nondiscrimination testing) and excess deferrals.  They also apply to:

  • Plan loan repayments
  • The 60-day timeframe for rollover completion
  • The deadline for filing Form 8955-SSA to report information on separated plan participants with undistributed vested benefits.

The relief for excess deferrals is a change from previous guidance indicating that 2019 excess deferrals still needed to be corrected by April 15, 2020.  In addition, while loan relief is already available to certain individuals for specified reasons related to COVID-19, this relief applies more broadly — albeit for a shorter period.  The Form 8955-SSA due date is the same as for the plan’s Form 5500, so the extension applies in the same manner.

Health Savings Accounts (HSAs). The notice extends the 60-day timeframe for completing HSA or Archer Medical Savings Account (MSA) rollovers.  It also extends the deadline to report HSA or Archer MSA contribution information by filing Form 5498-SA and furnishing the information to account holders.  The regular deadline for the 2019 Form 5498-SA would be June 1, 2020, placing it squarely within this relief period.

Business owners and their plan administrators should carefully review these notices to determine exactly what relief may be available.  While deadlines for the items noted above are impacted by this notice, other deadlines may fall outside the relief window.  Reach out to your Maloney + Novotny representative or use this online contact form, so we can provide you with further information about this or other forms of current federal relief.