Form 8955-SSA: An Overview

Form 8955-SSA, officially the “Annual Registration Statement Identifying Separated Participants with Deferred Vested Benefits,” serves a critical function; It reports separated employees still possessing vested account balances to the IRS and SSA, ensuring proper benefit tracking.

Purpose of Form 8955-SSA

The primary purpose of Form 8955-SSA is to provide the Internal Revenue Service (IRS) and the Social Security Administration (SSA) with crucial information. This information pertains to individuals who have separated from service with a company but still retain deferred vested benefits within the company’s retirement plan. By filing this form, plan administrators fulfill their obligation to report these separated participants, ensuring their retirement benefits are properly tracked. This reporting allows the SSA to maintain accurate records and eventually notify these individuals about their available retirement funds, even if they haven’t actively moved their money out of their accounts.

Furthermore, the data collected through Form 8955-SSA helps the IRS monitor compliance with retirement plan regulations and ensure that participants receive the benefits to which they are entitled. The form serves as a vital link between employers, former employees, and the government agencies responsible for overseeing retirement security. Accurate and timely filing of Form 8955-SSA is essential for maintaining the integrity of the retirement system and safeguarding the interests of plan participants.

Who Needs to File Form 8955-SSA?

Plan administrators are generally responsible for filing Form 8955-SSA. Any retirement plan covered by ERISA that has participants with deferred vested benefits must submit this form annually.

Reporting Separated Participants

Reporting separated participants on Form 8955-SSA is essential for maintaining accurate records of individuals entitled to future retirement benefits. This includes employees who have left the company but retain a vested interest in the retirement plan. The form requires specific information to ensure proper identification and benefit tracking by the Social Security Administration (SSA).

A participant is considered separated when they terminate employment but are entitled to deferred vested benefits. These benefits are essentially retirement funds that the employee has earned and has a right to receive in the future, even though they no longer work for the company.

The plan sponsor has a choice to include participants separating in the current or prior reporting year. The prior year approach is generally easier because it reduces the urgency to capture current termination data by period-end. Accurate reporting ensures that the SSA can notify retired employees about their unclaimed benefits, based on data reported on Form 8955-SSA.

Information Required on Form 8955-SSA

Form 8955-SSA mandates specific details for each separated participant. This includes their Social Security number, full name, and the value of their vested account balance. Accurate reporting is crucial for proper benefit administration.

Participant Details

When completing Form 8955-SSA, meticulous attention to participant details is paramount. The accuracy of this information directly impacts the Social Security Administration’s (SSA) ability to locate and notify individuals about their deferred vested retirement benefits.

Each participant listed on the form requires a complete and accurate entry of their full name, including first name, middle initial (if applicable), and last name. Discrepancies in name spellings can lead to reporting errors and potential delays in benefit disbursement.

The participant’s Social Security number (SSN) is another critical data point. This unique identifier is used by the SSA to match the individual with their retirement account information. Ensure the SSN is entered correctly and without any typos.

Furthermore, the vested account balance as of the end of the plan year must be accurately reported. This figure represents the amount the participant is entitled to receive at retirement. Any errors in the vested account balance can lead to incorrect benefit calculations.

Finally, the participant’s termination date is required. This date will determine which year the participant will be reported and allows the IRS and SSA to track individuals who have separated service.

Filing Deadlines and Extensions

Adhering to the filing deadlines for Form 8955-SSA is crucial to avoid penalties. The standard deadline is typically the last day of the seventh month following the end of the plan year. For plans operating on a calendar year basis, with a December 31st year-end, the filing deadline is July 31st of the subsequent year.

However, if necessary, an extension of time to file may be requested. By filing Form 5558, “Application for Extension of Time to File Certain Employee Plan Returns,” before the original deadline, plan administrators can obtain an extension until October 15th.

It is important to note that an extension of time to file does not extend the time to pay any taxes that may be due. Therefore, plan administrators should ensure that all required information is gathered and the form is filed as accurately and promptly as possible.

Keep in mind that if there are no participants to report for a plan year, the form does not need to be filed. However, it is always best to check the official IRS guidelines and instructions for the most up-to-date information.

Electronic Filing Requirements

The IRS mandates electronic filing (e-filing) for Form 8955-SSA under specific circumstances. If a filer is required to submit 250 or more returns of any type during the calendar year, they must electronically file Form 8955-SSA. This threshold applies across all return types, not just Form 8955-SSA.

Electronic filing can be done through the IRS’s Filing Information Returns Electronically (FIRE) system. This system requires registration and adherence to specific formatting guidelines. Plan administrators can also utilize third-party software providers that are approved by the IRS for e-filing.

E-filing offers several advantages, including faster processing, reduced errors, and confirmation of receipt. It also eliminates the need for paper forms and postage. However, it is crucial to ensure that the chosen software or method complies with all IRS requirements.

Remember to verify the FIRE system’s specifications and any updates to electronic filing procedures to ensure compliance and avoid potential filing errors or delays.

Where to Send Form 8955-SSA

For paper filings, send Form 8955-SSA to: Internal Revenue Service, 1973 North Rulon White Blvd., Ogden, UT 84404. Private delivery services should use this same address for submissions to the IRS.

Mailing Address

If you are submitting Form 8955-SSA via mail, it is crucial to use the correct mailing address to ensure timely and accurate processing by the Internal Revenue Service (IRS). The designated mailing address for Form 8955-SSA is:

Internal Revenue Service
1973 North Rulon White Blvd.
Ogden, UT 84404

This address should be used regardless of whether you are using the United States Postal Service (USPS) or a private delivery service. Using the correct address helps prevent delays in processing your form. It’s important to note that the IRS has different mailing addresses for different forms, so always double-check to ensure you are using the address specified for Form 8955-SSA; Furthermore, electronic filing is often a faster and more efficient method, and should be considered where possible, but for those who choose to mail the form, accuracy in addressing is key;

Penalties for Failure to File

Failing to file Form 8955-SSA or including inaccurate information can result in significant penalties. The IRS takes these reporting requirements seriously, as the information is crucial for the Social Security Administration to track retirement benefits.

For failures to file Form 8955-SSA, including failures to include all required participants, the penalty can be substantial. The penalty has increased to $10 per unreported participant multiplied by the number of days the failure continues, up to a maximum penalty. These penalties underscore the importance of timely and accurate filing. Plan administrators should ensure they have systems in place to gather and report the required information to avoid these costly penalties. Furthermore, seeking professional guidance can help ensure compliance and minimize the risk of errors.