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IRS EXTENDS SOME (BUT NOT ALL) EMPLOYEE BENEFIT PLAN DEADLINES
BY HUTCHINSON AND BLOODGOOD | April 22, 2020 | COVID-19 UPDATES
 
 
 
 

 

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 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 required to perform specified actions within the relief window, and it’s automatic — your business doesn’t need to file any form, letter or other request with the IRS.

Filing extensions beyond July 15, 2020, may be sought using the appropriate extension form, but the 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.

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

  • Plan loan repayments,
  • The 60-day timeframe for rollover completion, and
  • 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 appears to apply 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 Notice 2020-23 in conjunction with Revenue Procedure 2018-58 to determine exactly what relief may be available. For example, the revenue procedure covers various cafeteria plan items, but many deadlines may fall outside the notice’s window. We can provide you with further information about this or other forms of federal relief.
© 2020

 
 
 
 
 

HOW CAN WE HELP?

With the uncertainty of the situation surrounding coronavirus (COVID-19) continuing to evolve, we understand that it is affecting businesses and individuals in many different ways. 

At Hutchinson and Bloodgood, we value the relationships we have built with you. We will continue to be accessible so that we can serve and assist you while providing the level of attention that you deserve.

We will work alongside you throughout this ongoing situation to develop and build the optimal solutions for you.

Please contact us with your questions and concerns.

 
Disclaimer: This material has been prepared for informational purposes only. It is not intended as a substitute for speaking to your accountant, tax planner or financial planner. All information is provided “as is.” With change happening on a daily basis, we do not guarantee completeness, accuracy, timeliness or results obtained from the use of this information.
 
 
 
 
 
 
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