The Internal Revenue Service (“IRS”) recently issued PR-2024-05 (“Public Release”) to announce important tax relief for individuals and businesses affected by the passing of Tropical Storm Ernesto through Puerto Rico on August 13, 2024, including automatic extensions of key deadlines for filing certain federal tax returns and making tax payments. One of the most significant provisions of the Public Release of relevance for employee benefits plan sponsors and administrators is the automatic extension of the already extended deadline to file Form 5500 (Annual Return/Report of Employee Benefits Plan) (“Form 5500”) for calendar year filers.
Key Details Regarding Form 5500 Filings:
- New deadline: Form 5500 filings due on or after August 13, 2024, and before February 3, 2025 (the “Covered Period”), are now postponed until February 3, 2025.
- Pre-existing extension: The extended filing deadline for Form 5500 applies to calendar-year plan administrators who already had 2023 extensions running out on October 15, 2024.
- Automatic Extension: No action is required by plan sponsors or administrators, as the extension is granted automatically, yet plan administrators will want to make sure to mark the “Special Extension” box on item D of Part I of Form 5500 and enter a reference to “PR 2024-05”.
Other Reliefs for Individuals and Businesses:
- Individuals with a valid extension to file their 2023 return due to run out on October 15, 2024, can benefit from the new February 3, 2025 deadline. It should be noted, however, that tax payments related to these 2023 returns are not eligible for relief as they did not fall within the Covered Period.
- Businesses with an original or extended due date, including, among others, calendar-year partnerships and S corporations whose 2023 extensions ran out on September 16, 2024, and calendar-year corporations whose 2023 extensions run out on October 15, 2024, can also benefit from the new February 3, 2025 deadline.
- The February 3, 2025, deadline also applies to any payment generally due during the Covered Period, including, as applicable, the quarterly estimated tax payments due on September 16, 2024, and January 15, 2025, and the quarterly payroll and excise tax returns, normally due on October 31, 2024, and January 31, 2025.
The extensions granted by the IRS provide significant relief for businesses managing multiple compliance deadlines. Sponsors and administrators of employee benefit plans eligible for this tax relief should update their tax reporting deadlines to ensure compliance. If you have any questions about how this tax relief applies to you, you should seek legal or tax advice.