Multiple Employer Plans (“MEPs”) are required to file specific information about participating employers in the Plan with their Form 5500, as required under the Cooperative and Small Employer Charity Pension Flexibility Act (“CESC Act”). Effective for Plan Years beginning in 2014, MEPs were required to list the name and EIN of each participating employer, in addition to including a good-faith estimate of the percentage of total contributions made by each listed employer.
However, since 2014, the Department of Labor (“DOL”) has found that a substantial number of MEP filers were not in full compliance with the reporting requirements. MEPs that do not comply with the CESC Act would traditionally be subject to a hefty daily civil penalty. But, Field Assistance Bulletin 2019-01 (“FAB 2019-01”) released on July 24, 2019 provides some relief for those who did not understand the 2014 rules and now find themselves out of compliance.
FAB 2019-01 provides transition relief for MEP Form 5500 filings from 2014-2017, as long as the reports for 2018 going forward fully comply. Such filings will not be rejected or assessed a penalty solely for the failure to provide the employer name, EIN and good-faith estimate.
The 2018 Form 5500 for calendar year plans was generally due July 31, 2019. However, the DOL is granting MEPs an automatic special filing extension of up to 2½ months to file their 2018 Form 5500. The extension also applies to MEPs that have already made their 2018 filing as long as an amended filing is submitted by October 15, 2019 and is fully compliant with the rules.
If you have questions or want further detail about this relief, please contact your Nyhart consultant.