justanotheradmin Posted June 3, 2015 Report Share Posted June 3, 2015 One-person, owner only DB plan document was signed and set up for 2014. Owner has had a change of heart and no longer wants the plan. Would like something written to terminate / undo / close the plan. No deposits were made, nothing exists other than the plan document and I believe a TIN that was applied for the plan. I found this thread: http://benefitslink.com/boards/index.php?/topic/45372-er-changed-mind-no-contributions/ Are there others I should looking at? A colleague seemed to think there was a form that could be filed with the IRS but I'm not familiar with any. Does anyone know or have additional suggestions? I'm a stranger on the internet. Nothing I write is tax or legal advice. I'd like a witty saying here, but I don't have any. When in doubt, what does the plan document say? Link to comment Share on other sites More sharing options...
Mike Preston Posted June 4, 2015 Report Share Posted June 4, 2015 There is no shortcut. Read the thread you cited. Ignore the jokes. You need an actuary to determine the required minimum contribution. It should be funded. Or excise tax paid. Plan should be terminated formally ASAP because otherwise 2nd year of accrual will take place (if it can even be avoided at this point, depends on the document). If appropriate, change prior sentence to the plan's formula should be reduced to minimize or eliminate 2nd year accrual. Final 5500-EZ should be filed when plan terminated. Anybody who hints at ignoring the plan because "nobody knows about it" should be web-shamed. You have precious little time to do the right thing and amend the plan and issue a 204(h) Notice to save the client from an accrual. Don't waste it looking for a way to help your client commit a crime. Link to comment Share on other sites More sharing options...
Belgarath Posted June 4, 2015 Report Share Posted June 4, 2015 Agree with Mike, except that no 204(h) Notice required for a 1-person owner only DB plan. If your client chooses to "sweep it under the rug" make sure your tail is covered, and that all your communication is appropriate and accurate. Then if they ignore your advice, it ain't your problem. Link to comment Share on other sites More sharing options...
Mike Preston Posted June 4, 2015 Report Share Posted June 4, 2015 With "clients" like this it would not come as a surprise to me to find that there is a non-owner participant and that a 204(h) is required. I agree that if there truly is nobody else a 204(h) Notice is not required. Link to comment Share on other sites More sharing options...
justanotheradmin Posted June 4, 2015 Author Report Share Posted June 4, 2015 Thank you Mike and Belgarath for the feedback. You both affirmed what I already knew. The most we can help the owner is with a plan term amendment, prospectively, the same as what we would do for any other plan. We are informing them they still have a plan and that we won't be able to service them any further. I'm a stranger on the internet. Nothing I write is tax or legal advice. I'd like a witty saying here, but I don't have any. When in doubt, what does the plan document say? Link to comment Share on other sites More sharing options...
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