I posted this question once before, but got no response, so am trying again. The Summary Annual Report (SAR) must be distributed to participants/beneficiaries 9 months after the plan year end. Or, if the 5500 is on extension, two months after the extension filing date. This is a DOL requirement. However, I've searched and cannot find what, if any, are the penalties for not providing this notice to participants/beneficiaries.

I have a client who is questioning this requirement. I was able to tell him that providing the SAR is a requirement, but that is all. I know, as probably many of you do, that many Employers do not give this item out - especially the small, closely-held entities.

My understanding, which carries no guarantees, is that there is no specific penalty for not providing them when due, but if something requests them and then you don't provide it within the proscribed time frame then the penalties for failure to provide the requested documents applies. See 29 CFR 2560.

According to http://www.seethebenefits.com/CRLframeset8...etirereport.htm

"The willful violation of the requirement to provide SPDs, SARs and certain other information requested by participants to the participants can result in a fine of up to $5,000, imprisonment for up to 1 year, or both if the person convicted is an individual. If the person convicted is not an individual (e.g., it is a corporation), the fine can be as high as $100,000. In addition, the failure to provide certain information requested by a participant or beneficiary within 30 days after a request can result in a civil penalty of up to $110 per day. This amount is payable to the participant or beneficiary involved."