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IRS Eliminating Form 5500 Proposed Penalty Notices

The IRS announced on December 7 that it is eliminating proposed penalty notices relating to Form 5500 filings in an effort to reduce processing costs, eliminate notices, and comply with notice and system standards. The IRS will no longer send the following notices: CP 213N: Proposed Penalty Notice for Late Filing of Form 5500, Annual Return/Report of Employee Benefit Plan; and CP 213I: Proposed Penalty Notice for Incomplete Filing of Form 5500. The IRS will continue to send notice CP 283: Penalty Charged on Your 5500 Return, if a Form 5500 is filed late or is incomplete. The IRS announcement is here.

IRS Issues 2012 List of Changes in Plan Qualification Requirements

The IRS released Notice 2012-76, which contains the 2012 Cumulative List of Changes in Plan Qualification Requirements to be used by plan sponsors and practitioners filing determination letter applications beginning February 1, 2013. Those using the 2012 cumulative list will primarily be single employer, individually designed defined contribution and defined benefit plans in Cycle C of the IRS?ÇÖs 5-year remedial amendment cycle program and ?º 414(d) governmental plans. An individually designed plan is generally in Cycle C if the last digit of the plan sponsor?ÇÖs EIN is 3 or 8. To retain its qualified tax status, a plan must be amended to comply with all statutory, regulatory, or guidance changes in tax-qualification requirements. In reviewing determination letter applications beginning February 1, 2013, the IRS will generally not look for plan amendments related to guidance issued after October 1, 2012; statutes enacted after October 1, 2012; qualification requirements that become effective… Continue Reading

IRS Releases Final Regulations on the Comparable Effectiveness Fee

The U.S. Internal Revenue Service (?Ç£IRS?Ç¥) recently released final regulations regarding the ?Ç£comparable effectiveness fee?Ç¥ applicable to certain health insurers and to plan sponsors of self-insured health plans under the Patient Protection and Affordable Care Act (?Ç£PPACA?Ç¥). The comparable effectiveness fee will assist with financing the Patient-Centered Outcomes Research Institute (the ?Ç£Institute?Ç¥) which was established under PPACA to fund research of the clinical effectiveness of medical treatments, procedures and drugs. PPACA imposes the comparable effectiveness fee on an applicable issuer or plan sponsor for each plan or policy year ending on or after October 1, 2012, and before October 1, 2019, to support the Institute. The fee is $2.00 multiplied by the average number of lives covered under the plan or policy. (For plan or policy years ending before October 1, 2013, the fee is $1.00 multiplied by the average number of lives covered under the plan or policy.) The… Continue Reading

December 2012