Form 5500 - Ez questions

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Topic Author
kareysue
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Joined: Fri Oct 10, 2008 10:07 pm

Form 5500 - Ez questions

Post by kareysue »

I am trying to fill out a form 5500-ez for my
the final year of my solo 41k. I was wondering since this
is my first year filing since my solo 401k never exceeded
250k, for line 1b - three-digit plan number do I just put
001 and since my assets were transffered from my solo 401k to
my rollover ira on december 28, 2014, so at the end of the
year plan assets do i put $0. And for line 8 in 2014, I only
contributed $15000 to the plan but employer did not contribute
i only contributed the $15000 in ttotal by deducting the
funds from my salary.

Also, for line 9 plan characterstic i put 1a, 2e, and 3b
1a - benefits are pay related
2e profit sharing
and 3b plan covering self-employed indidivudals

i was the only full time employee in 2014. But there was no profit
sharing in 2014 but there was in 2012, so will my plan
still have the 2e profit sharing characteristic? Thanks
ERISA Stone
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Re: Form 5500 - Ez questions

Post by ERISA Stone »

The "1" codes are only related to defined benefit plans, which I assume you do not have. You will likely only use the following codes: 2E, 2J, 2R, 3B, 3D. Confirm which ones apply to your plan. It doesn't matter if you made a profit sharing contribution; it's if your plan offers the feature or not.

Yes, if you took a distribution from the plan and the assets are zero, put 0 for year end plan assets. Also, if this is your first year filing and the last filing, make sure to mark both boxes at the top of the form.

001 is fine for the plan number, assuming it's your company's first retirement plan.

If the 15k is considered a 401k contribution (i.e. salary deferral) rather than an employer contribution (profit sharing), you enter it as a participant contribution in section 8. Section 8 is only related to contributions to the plan, so you would not put the amount you rolled over here, as it is a distribution.
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

Hi,
Just wondering what is 3D? I never got any letter from IRS regarding my plan. Also, with 2R, my solo 401k plan was administrated by me but Vanguard was the custodian, is that what this means?
ERISA Stone
Posts: 1626
Joined: Tue Jun 24, 2014 8:54 am

Re: Form 5500 - Ez questions

Post by ERISA Stone »

kareysue wrote:Hi,
Just wondering what is 3D? I never got any letter from IRS regarding my plan. Also, with 2R, my solo 401k plan was administrated by me but Vanguard was the custodian, is that what this means?
3D:
Pre-approved pension plan – A master, prototype, or
volume submitter plan that is the subject of a favorable
opinion or advisory letter from the IRS.
When you use an adoption agreement from a provider, the related plan document has already been approved by the IRS, meaning they have determined that any option you choose based on the provisions of the institution's plan document has been accepted by them, and you don't need an individual determination by the IRS for your specific plan. The letter wouldn't come to you. Your provider received it when they submitted their document.
livesoft
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Joined: Thu Mar 01, 2007 8:00 pm

Re: Form 5500 - Ez questions

Post by livesoft »

ERISA Stone wrote:When you use an adoption agreement from a provider, the related plan document has already been approved by the IRS, meaning they have determined that any option you choose based on the provisions of the institution's plan document has been accepted by them, and you don't need an individual determination by the IRS for your specific plan. The letter wouldn't come to you. Your provider received it when they submitted their document.
But wouldn't one get a copy of the letter as part of the QRP adoption agreement which is the plan's legal document submitted to the IRS for approval?

ERISA Stone, you mentioned I think that you have a TDAmeritrade i401k. I have one as well, so I have the IRS letters in my packet of documents.
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ERISA Stone
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Re: Form 5500 - Ez questions

Post by ERISA Stone »

livesoft wrote:
ERISA Stone wrote:When you use an adoption agreement from a provider, the related plan document has already been approved by the IRS, meaning they have determined that any option you choose based on the provisions of the institution's plan document has been accepted by them, and you don't need an individual determination by the IRS for your specific plan. The letter wouldn't come to you. Your provider received it when they submitted their document.
But wouldn't one get a copy of the letter as part of the QRP adoption agreement which is the plan's legal document submitted to the IRS for approval?

ERISA Stone, you mentioned I think that you have a TDAmeritrade i401k. I have one as well, so I have the IRS letters in my packet of documents.
You bring up a good point. It's a good idea to have the determination letter in your documents. I don't have it but I'm not worried about it. It should be something that TDA provides upon request. It wasn't part of any original package that I can see.

It was interesting when I opened up the account. For whatever reason, they would not provide me with the plan document (the 80 pager). I had to threaten to open up an account at Scottrade to get it. I assume I was dealing with someone who wasn't familiar with 401k documents, but it was a bit shocking to me. I couldn't possibly be the first person to have requested it.
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

Thanks for your answers ERISA Stone. What does 2R mean?
ERISA Stone
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Joined: Tue Jun 24, 2014 8:54 am

Re: Form 5500 - Ez questions

Post by ERISA Stone »

kareysue wrote:Thanks for your answers ERISA Stone. What does 2R mean?
2R:
Participant-directed brokerage accounts provided as
an investment option under the plan
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

What does that mean? As a solo 401 administrator I kept the funds at vanguard, but i used 401kadministrators.com to administer it.
livesoft
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Re: Form 5500 - Ez questions

Post by livesoft »

To mean it would be that participants can buy/sell any and all stocks, ETFs, and funds available at their custodian (in your case Vanguard) and do NOT have to choose from a small list of available funds chosen by the plan administrator.

Several folks have mentioned that their employer-sponsored 401(k) plan has a "brokerage option", so that they can choose investments outside of the vetted list of funds in the plan.
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Topic Author
kareysue
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Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

ok thanks for your help. This form is almost due July 31 so I am mailing it tomorrow with these codes.
livesoft
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Re: Form 5500 - Ez questions

Post by livesoft »

kareysue wrote:ok thanks for your help. This form is almost due July 31 so I am mailing it tomorrow with these codes.
I didn't think you could mail it. I thought for such plans it had to be electronically submitted nowadays.
http://www.irs.gov/Retirement-Plans/Fil ... h-Database
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ERISA Stone
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Re: Form 5500 - Ez questions

Post by ERISA Stone »

livesoft wrote:
kareysue wrote:ok thanks for your help. This form is almost due July 31 so I am mailing it tomorrow with these codes.
I didn't think you could mail it. I thought for such plans it had to be electronically submitted nowadays.
http://www.irs.gov/Retirement-Plans/Fil ... h-Database
You can mail the 5500ez. The 5500SF is electronically filed.
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

One other question, I recently rolled over the plan to a rollover ira on december 28, 2014. That was the date that my vanguard solo 401k also closed. For part 1 when it ask for the beginning and ending date do i put 12/31/2014 or 12/28/2014?

Also, if 3a's information is the same as 2a can I put the same? and do i have to enter a admin's EIN and telephone?

Thanks for your great help Once again.
ERISA Stone
Posts: 1626
Joined: Tue Jun 24, 2014 8:54 am

Re: Form 5500 - Ez questions

Post by ERISA Stone »

kareysue wrote:One other question, I recently rolled over the plan to a rollover ira on december 28, 2014. That was the date that my vanguard solo 401k also closed. For part 1 when it ask for the beginning and ending date do i put 12/31/2014 or 12/28/2014?

Also, if 3a's information is the same as 2a can I put the same? and do i have to enter a admin's EIN and telephone?

Thanks for your great help Once again.
I couldn't find guidance from the IRS/DOL, but this post on http://www.benefitslink.com indicates your end date should be 12/28/2014. This would also mean you should check the box for a short plan year. http://benefitslink.com/boards/index.ph ... rmination/

You can put "SAME" for plan administrator.
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

I was wondering regarding 2R. Since vanguard brokerage accounts only let you purchase vanguard funds would 2R still apply?
livesoft
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Re: Form 5500 - Ez questions

Post by livesoft »

kareysue wrote:I was wondering regarding 2R. Since vanguard brokerage accounts only let you purchase vanguard funds would 2R still apply?
Vanguard brokerage accounts certainly let one purchase all kinds of non-Vanguard investments, ETFs, funds, etc. I'm think there must be some confusion here.
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Topic Author
kareysue
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Re: Form 5500 - Ez questions

Post by kareysue »

oh when i go to that option it says:

"Sign up for a Vanguard brokerage account. You'll have the flexibility to diversify your portfolio with Vanguard ETFs® and other investment products"

I think I only signed up for the vanguard mutual fund side. I checked my current traditional ira and i my past solo 401k account, it never seems to let me buy stocks
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

I mailed the form out yesterday but I am not sure if I made a mistake or not The return I checked A 1, the first return filed for the plan 3.) the final return for the plan and 4 a short plan year.

I terminated the plan on december 29, 2015 and already rollover the funds to a traditional ira. But for 6a I put number of participants in the beginning of the year I put 1 and at the end of the plan year for 6b I still put 1. I am not sure if I should put 0 or 1 for that but it is too late because I already filed yesterday.
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

Just bumping this up to see if anyone has any input Thanks
ERISA Stone
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Joined: Tue Jun 24, 2014 8:54 am

Re: Form 5500 - Ez questions

Post by ERISA Stone »

kareysue wrote:I mailed the form out yesterday but I am not sure if I made a mistake or not The return I checked A 1, the first return filed for the plan 3.) the final return for the plan and 4 a short plan year.

I terminated the plan on december 29, 2015 and already rollover the funds to a traditional ira. But for 6a I put number of participants in the beginning of the year I put 1 and at the end of the plan year for 6b I still put 1. I am not sure if I should put 0 or 1 for that but it is too late because I already filed yesterday.
If the assets were distributed from the plan prior to 12/31/2014, you should have checked 1. first return; 2. final return; 3. short plan year return (the plan year at the top should also indicate 12/29/2014).

The answer for participants at year end should have been 0 since all of the assets were paid out.

I suspect that you will get a notification from the DOL but I'm not certain. I've never received a notice regarding participant count. You could amend the return and resend it.
Topic Author
kareysue
Posts: 74
Joined: Fri Oct 10, 2008 10:07 pm

Re: Form 5500 - Ez questions

Post by kareysue »

Hi,
Do you think this is important enough where I should amend it or just leave it alone? I don't want to raise any eye brows or anything. Not sure how common or uncommon this error is because I notice a lot of guides don't mention about this either. Thanks
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