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Form 8955-SSA Preparation

Form 8955-SSA is an annual report filed by employers to report information about separated participants with deferred vested benefits under their retirement plans.  The purpose in filing the form is to report information about a separated participant to the Social Security Administration (SSA), so that the SSA can notify the separated participants of their potential retirement benefits when they become eligible for Social Security.

Form 8955-SSA Preparation

To complete the form accurately the needed information includes documentation about the Plan Sponsor, the Plan Administrator, the Plan Year along with the total number of participants with deferred vested benefits and specific information about each participant.

The form consists of two parts:

  1. Part 1 includes information about the Plan and the Plan Sponsor
  2. Part 2 includes information about Deferred Vested Participants

It’s important to note that Form 8955-SSA must be filed electronically unless you have received a waiver from the IRS. The form is filed using the IRS’s FIRE (Filing Information Returns Electronically) system or a third-party software provider that is approved by the IRS.

Who Must File Form 8955-SSA?

Form 8955-SSA is required to be filed by plan administrators or plan sponsors of certain retirement plans subject to the Employee Retirement Income Security Act (ERISA).

These plans typically include:

  1. Defined benefit pension plans
  2. Defined contribution plans, such as 401(k) plans, profit-sharing plans, and stock bonus plans
  3. 403(b) plans for non-profit organizations
  4. Certain 457(b) plans for governmental and non-governmental entities

The form must be filed for any plan year in which one or more participants, separated in the previous plan year, has deferred vested benefits under the plan at the end of the current plan year.  Multiple employer plans would report a participant that incurs two successive 1-year breaks in service and has deferred vested benefits. If you are a plan administrator or plan sponsor of a retirement plan subject to ERISA and have separated participants with deferred vested benefits in the plan, you are required to file Form 8955-SSA.

IRS Form 8955-SSA Extension Filing

Timing and Deadlines

The deadline for filing is the last day of the seventh month following the end of the plan year.  You can apply for a 2.5-month extension by filing Form 5558, Application for Extension of Time to File Certain Employee Plan Returns.

To avoid penalties, it is crucial to file Form 8955-SSA on time, accurately, and with complete information.  Failure to file penalties can be severe. There are three possible penalties related to the Form 8955-SSA:

  • Failure to file an annual registration statement: The IRS can impose a penalty of $10 per participant for each day the form is not filed, up to a maximum of $50,000
  • Failure to file notification of a change in the status of the plan: The penalty for failure to file a notification of a change in the status of the plan, termination of the plan, or a change in the name or address of the plan administrator is $10 for each day such failure occurs, up to a maximum of $10,000.
  • Failure to furnish statement ot plan participant or fraudulent statement: A penalty of $50 is imposed for each willful failure to furnish the statement to each participant or a willful furnishing of a false statement.

 

Differences from Form 5500

Keep in mind that Form 8955-SSA is specifically for reporting separated participants with deferred vested benefits in retirement plans, while Form 5500 is a more comprehensive annual report for all types of employee benefit plans, covering financial, participant, and operational information.

Both forms are filed annually and have similar deadlines, but they are submitted to different agencies and through different electronic systems.

Are There Situations Where Form 8955-SSA Does Not Need
to be Filed?

Yes!

  1. If there are no separated participants with deferred vested benefits under the plan during a specific plan year, there is no requirement to file for that year
  2. If the plan is not subject to the Employee Retirement Income Security Act (ERISA), such as certain church plans or non-ERISA 457(b) plans, there may be no requirement to file
  3. If the plan has been terminated and all benefits have been distributed to the participants, including the separated participants with deferred vested benefits, there is no requirement to file for subsequent plan years.
  4. One-participant retirement plans: These plans, also known as solo 401(k) or individual 401(k) plans, cover only the business owner (and their spouse, if applicable) and have no other employees. In general, these plans filing are not required.

It is essential to consult the Form 8955-SSA instructions, relevant IRS guidance, and your plan documents to determine if you are required to file Form 8955-SSA. If you are unsure about your filing requirements, consider seeking professional advice from a retirement plan expert or tax advisor.

IRS Form 8955-SSA Extension Filing
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Maintaining Accurate Records and Ensuring
Data Privacy

It is important that you maintain accurate records in case of a compliance audit by the IRS, the need to correct errors or if there are participant inquiries.  Additionally, it is important to store these records securely to protect sensitive participant information and ensure data privacy.  You should also consider developing a comprehensive record retention policy that includes guidelines for maintaining and eventually disposing of records related to Form 8955-SSA and other employee benefit plan documents.

A Benefit Plan Administrator should retain records related to Form 8955-SSA for a minimum of six years following the date the form is filed.  This is in line with the general record retention guidelines for employee benefit plans as stated in ERISA regulations.

Why Choose Us?

With offices from coast to coast, 5500Tax Group’s exclusive focus is on employee benefit tax compliance issues and regulatory changes.  As highly qualified CPAs in good standing with decades of experience, our team of experts is well-versed in the latest regulatory reporting requirements and is dedicated to providing you with comprehensive and accurate Form 8955-SSA preparation.

Our commitment to you is accuracy, timeliness, and customer satisfaction which ensures that your filing experience is as seamless as possible. Click here to learn more.

Contact us today and let us help you work through the intricacies of Form 8955-SSA!

 

E Powell-Seubert & Associates, Inc.

Ann at 5500 Tax Group has been a great partner for the past twelve plus years.  We find the process in working with 5500 Tax Group for client Form 5500 filing requirements has been simple, efficient, and timely. Ann has been particularly helpful in guiding mutual clients through the Department of Labor Delinquent Filer Voluntary Compliance Program (DFVCP) with an easily understood step-by-step explanation for all parties involved. We look forward to working with Ann for many years to come.

Briones, Briones International

Amy, Thank you for years of extremely knowledge and professional guidance regarding retirement plans including the filing of form 5500.  You have made the myriad of IRS regulations and alphabet soup understandable for a civilian. I am truly grateful for your patience and never hesitating to answer dumb questions.  Any client seeking your guidance and advice will be beyond pleased with your services.

S Herrle-Henderson Brothers, Inc.

Ann Myers has been a trusted advisor and our Form 5500 filing partner for well over 15 years.   As leading experts in the Employee Benefits industry with a significant number of local and national clients, we rely heavily on Ann to prepare a large number of health and welfare 5500 forms every year for our clients.   Regardless of whether she is providing guidance for a client that is filing for the first time, suggesting changes on what should be reported in a 5500 form, providing strategy to remedy a noncompliant plan, or walking an employer through the DFVCP filing process, we know our clients are receiving the best advice from one of the most knowledgeable experts in the industry.

M Fair-USI Insurance Services

Our team has worked with Ann Myers and the 5500 Tax Group for many years. Ann makes the whole 5500 process as painless as possible and personally engages with each client. We have continued to use Ann for the “personal” touch and level of details that Ann brings to her work. Our team has 100% confidence in Ann executing on filings, details and deadline. Ann brings a positive attitude, years of experience and her expertise to every engagement. Our client and team enjoy working with Ann and USI would absolutely serve as a reference.

A Cox-Wabtec

Wabtec has worked with Ann Myers of the 5500Tax Group, Inc. for the past 15 years.  She manages all of the details for our 5500 preparation.  She prepares the 5500s for our Pension Plan, Savings Plan, and various Health and Welfare plans.  She also completes the PCORI filings and Summary Annual Reports.  All is done efficiently, effectively, and reasonably priced.  Ann coordinates with our auditors, record keepers, and our ERISA attorneys to gather all required information and get any answers required.  Definitely recommend!

W Wang-L&W Infoserve Co.

In June 2022, we received IRS notices with huge penalties (~$200K) as they didn’t receive F5500 – Annual Report of Employee Benefit Plan for 2019 and 2020 for our S Corporation.  We immediately started working with Amy Boyd from 5500 Tax Group.  Amy answered our questions with great patience, provided clear guidance and took appropriate actions on communicating with IRS.  With a lot of time and effort, she helped us resolve this issue that gave us so much stress.  We are grateful for her assistance and highly recommend her services.  She is professional, efficient, and friendly.