IRS Sending Notices to One Participant Plans

50 %
50 %
Information about IRS Sending Notices to One Participant Plans
Business & Mgmt

Published on February 18, 2014

Author: OConnorDavies

Source: slideshare.net

Description

The IRS is mailing a Notice to every one-participant plan that has previously filed a Form 5500-EZ or Form 5500-SF. The Notice provides the basic information regarding the filing of Forms 5500-EZ or SF. The Notice also addresses requiring certain types of foreign retirement plans to file a Form 5500-EZ.

One purpose of this Notice is to remind plan sponsors that, if aggregate plan assets fall to less than $250,000, they are not actually required to file a Form 5500. The Notice fails to note that failure to file a Form 5500 in that situation means that the activities of the plan for that plan year continue to be open for examination indefinitely. For plans that may have stopped filing Form 5500 because their plan assets fell below $250,000 in the past, the Notice also serves as a reminder that it may be time to file again if their assets now exceed the threshold.

Review this article for full details - O'Connor Davies CPA - NY CPA Firm, 401k Plan Auditor

Employee Benefits Consideration IRS Sending Notices to One-Participant Plans Louis F. LiBrandi, Principal The IRS is mailing a Notice to every one-participant plan that has previously filed a Form 5500-EZ or Form 5500-SF. The Notice provides the basic information regarding the filing of Forms 5500-EZ or SF. The Notice also addresses requiring certain types of foreign retirement plans to file a Form 5500-EZ. Louis F. LiBrandi Principal llibrandi@odpkf.com 212.286.2600 One purpose of this Notice is to remind plan sponsors that, if aggregate plan assets fall to less than $250,000, they are not actually required to file a Form 5500. The Notice fails to note that failure to file a Form 5500 in that situation means that the activities of the plan for that plan year continue to be open for examination indefinitely. For plans that may have stopped filing Form 5500 because their plan assets fell below $250,000 in the past, the Notice also serves as a reminder that it may be time to file again if their assets now exceed the threshold. The Notice has understandably confused many sponsors of one-participant plans. If you have received such a Notice, you may ignore it. Plan sponsors should be aware, however, of filing requirements if plan assets are at or near the $250,000 year-end threshold. IRS Issues Erroneous Form 8955-SSA Penalty Notices Approximately 4,000 plan sponsors have recently received a penalty Notice from the IRS that erroneously informs them that the IRS is assessing a penalty due to their filing a late or incomplete Form 8955-SSA – Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits. Form 8955-SSA is generally required to be filed by retirement plans in any plan year where there are terminated plan participants with an accrued vested benefit that remains in the plan (i.e., the vested benefit was not paid out by the end of the plan year). The IRS has confirmed that a programming issue caused these plan sponsors to receive the Notice in error. The IRS has also stated that it will be sending a letter to the plan sponsors that received the Notice within 2-3 weeks from when they became aware of the problem. The letter will inform the plan sponsors to disregard the erroneous Notice and that no further action is necessary.

Contact: New York, NY 212.286.2600 212.867.8000 Harrison, NY 914.381.8900 If you have received a Notice from the IRS and require any assistance please contact O’Connor Davies’ Employee Benefit Services Group for assistance with these requirements. If you would like more information or have any questions, please contact Louis F. LiBrandi at (212) 286-2600; llibrandi@odpkf.com or Tim Desmond at (914) 381-8900; tdesmond@odpkf.com. About Our Practice: Stamford, CT 203.323.2400 Paramus, NJ 201.712.9800 New Windsor, NY 845.220.2400 Wethersfield, CT 860.257.1870 O'Connor Davies, LLP is a full service Certified Public Accounting and consulting firm that has a long history of serving clients both domestically and internationally and providing specialized professional services of the highest quality. With roots tracing to 1891, six offices located in New York, New Jersey and Connecticut, and approximately 400 professionals including 70 partners, the Firm provides a complete range of accounting, auditing, tax and management advisory services. O’Connor Davies is ranked as number 39 in Accounting Today's 2012 "Top 100 Firms" in the United States. The Firm is also within the 20 largest accounting firms in the New York Metropolitan area according to Crain's New York Business and the Westchester and Fairfield County Business Journals. O’Connor Davies, LLP is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or liability for the actions or inactions on the part of any other individual member firm or firms. IRS CIRCULAR 230 DISCLOSURE: To comply with IRS regulations, we are required to inform you that unless expressly stated otherwise, any discussion of U.S. federal tax issues in this correspondence (including any attachments) is not intended or written to be used, and cannot be used, (i) to avoid any penalties imposed under the Internal Revenue Code, or (ii) to promote, market, or recommend to another party any transaction or matter addressed herein.

Add a comment

Related presentations

Related pages

Retirement Topics - Notices - Internal Revenue Service

Retirement Topics - Notices. Plan ... within one year from when an employee becomes a plan ... participant notices required by the IRS ...
Read more

A publication of the ASPPA Government Affairs Committee ...

IRS Sending Notices to One-Participant Plans By: ... The IRS is mailing every one -participant plan that has previously filed a Form 5500-EZ or
Read more

Retirement Plan Participant Notices - Suspension of ...

Retirement Plan Participant ... Who is responsible for sending it: The administrator of the plan. Return to Retirement Plan Participant Notices.
Read more

Section 79 Plans -- Big Trouble Ahead - IRS Audit Focus ...

Section 79 Plans are insurance ... 419 Welfare Benefit Plan, and 412i Retirement Plan Participants ... and the IRS immediately began sending out notices ...
Read more

Letter Regarding IRS Form 8955-SSA Participant Notice ...

Letter Regarding IRS Form 8955-SSA Participant ... Center is a one-of-a-kind ... Deferred vested pension notices help plan participants in ...
Read more

IRS Publishes Final Rules for Providing ERISA Section 204 ...

IRS Publishes Final Rules for Providing ... notices to: • Plan participants; ... Complex plan changes could require more than one illustration.
Read more

Safe Harbor Plans | Safe Harbor Plan Notices | Delaware ...

Don’t Forget to Distribute Safe Harbor Notices. By ... with Safe Harbor Plan Designs, the IRS requires ... to plan participants may be ...
Read more

Employee Benefits & Executive Compensation ADVISORY

Employee Benefits & Executive Compensation ADVISORY ... Notice to Plan Participants? ... to issue one or more annual notices to participants before ...
Read more

Notices, notices, notices - Prudential Financial

Notices, notices, notices ... DOL permits certain notices to be provided under IRS ... by the average plan participant.
Read more