IRS Issues Draft Form 8955 and Instructions

The IRS on Nov. 2 issued a draft version of Form 8955, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits, for 2020 reporting. 

The instructions for the new version of Form 8955 note that the following aspects are new.

Purpose of the form. The instructions have been revised to clarify how the Form 8955-SSA is to be used to report information about deferred vested participants using the correct entry codes. 

How to file. The note of caution under “How To File” has been revised to clarify that no attachments are allowed with Form 8955-SSA. 

Transfer of a participant’s benefit to the plan of a new employer. The instructions under “Transfer of a Participant’s Benefit to the Plan of a New Employer” have been revised to clarify that the new plan administrator must complete a Form 8955-SSA using entry code C, except in the rare situation in which the previous plan number and employer identification number (EIN) are not available; then, entry code A would be used.

About the Form 

Form 8955 replaced Schedule SSA (Form 5500), and is used to satisfy reporting requirements under Internal Revenue Code Section 6057(a). Form 8955-SSA is used to report information concerning each participant who separated from service and is covered by the plan and entitled to a deferred vested benefit under the plan but is not paid this retirement benefit. 

More specifically, the plan administrator of each plan subject to the vesting requirements must file Form 8955-SSA for participants who have a deferred vested benefit under the plan and: 

• separated from service and are covered by the plan, but vested retirement benefits are not paid and were not previously reported (using entry code A in Part III, line 9, column (a)); 
• were previously reported under the plan, but whose information is being corrected (using entry code B in Part III, line 9, column (a)); and
• were previously reported as deferred vested participants on another plan’s filing if their benefits were transferred (other than in a rollover) to the plan of a new employer during the covered period (using entry code C in Part III, line 9, column (a)); or 
• were previously reported under the plan but have been paid out or are no longer entitled to those deferred vested benefits (using entry code D in Part III, line 9, column (a)).

Notable 

This version of Form 8955 is a draft only—it is not to be used for filing. More information about Form 8955 is available here.