What is the Delinquent Filer Voluntary Compliance Program (DFVCP or DFVC Program)?

The Delinquent Filer Voluntary Compliance Program (DFVCP, DFVC Program) was adopted by the Department of Labor’s Employee Benefits Security Administration (formerly the Pension and Welfare Benefits Administration) in an effort to encourage delinquent filers to voluntarily comply with the annual reporting requirements under Title I of ERISA. As adopted, the DFVCP permitted eligible plan administrators the opportunity to avoid the assessment of civil penalties otherwise applicable to administrators who failed to file timely annual reports (commonly referred to as the Form 5500) by voluntarily complying with the filing requirements under Title I of ERISA and paying reduced civil penalties specified in the DFVCP.

In early 2013, the DOL updated the DFVCP to reflect the mandatory electronic filing requirement for the Form 5500 under EFAST 2. The updated DFVCP replaces the program adopted on April 27, 1995, and updated on March 28, 2002, and became effective on January 29, 2013. The updated program maintains the penalty structure that was announced in the 2002 update.

In an effort to further encourage and facilitate voluntary compliance by plan administrators with the annual reporting requirements of Title I of ERISA, the DOL updated the DFVCP by simplifying the procedures governing participation and lowering the civil penalty assessments thereunder.

According to DOL guidance, the penalty structure under the DFVCP is as follows:

•    Reduced per-day penalty: The basic penalty under the program was reduced from $50 to $10 per day for delinquent filings.

•    Reduced per-filing cap: The maximum penalty for a single late annual report was reduced from $2,000 to $750 for a small plan (generally a plan with fewer than 100 participants at the beginning of the plan year) and from $5,000 to $2,000 for a large plan.

•    “Per plan” cap: The DFVCP’s “per plan” cap is designed to encourage reporting compliance by plan administrators who have failed to file an annual report for a plan for multiple years. The “per plan” cap limits the penalty to $1,500 for a small plan and $4,000 for a large plan regardless of the number of late annual reports filed for the plan at the same time. There is no “per administrator” or “per sponsor” cap. If the same person is the administrator or sponsor of several plans required to file annual reports under Title I of ERISA, the maximum applicable penalty amounts would apply for each plan.

•    Small plans sponsored by certain tax-exempt organizations: A special “per plan” cap of $750 applies to a small plan sponsored by an organization that is tax-exempt under Internal Revenue Code Section 501(c)(3). The $750 limitation applies regardless of the number of late annual reports filed for the plan at the same time. It is not available, however, if as of the date the plan files under the DFVCP, there is a delinquent annual report for a plan year during which the plan was a large plan.

•    Top hat plans and apprenticeship and training plans: The penalty amount for “top hat” plans and apprenticeship and training plans was reduced to $750.

Questions about the DFVCP should be directed to EBSA by calling (202) 693.8360 or accessing its Web site at http://www.dol.gov/ebsa.