RayJJohnsonJr Posted June 2, 2022 Share Posted June 2, 2022 What is the most efficent way to withhold Federal taxes and remit the withholding to the gov't? I have never had to do this before because my plans are typically with John Hancock or Charles Schwab who take care of the withholding on distributions. The plan I need to start withholding and remitting taxes on is a 1 (80 yr. old) participant profit sharing plan with all investments in a Charles Schwab account which I have access to as the Advisor. But Schwab is not the TPA, I am. I just want to do this the easiest way possible. Thanks all. Link to comment Share on other sites More sharing options...
ratherbereading Posted June 2, 2022 Share Posted June 2, 2022 I think your best bet is to use Penchecks. https://penchecks.com/ Luke Bailey, Lou S. and ESOPMomma 3 4 out of 3 people struggle with math Link to comment Share on other sites More sharing options...
jsample Posted June 2, 2022 Share Posted June 2, 2022 Agree, outsource it. Link to comment Share on other sites More sharing options...
Gilmore Posted June 2, 2022 Share Posted June 2, 2022 Penchecks is who we use too. Link to comment Share on other sites More sharing options...
ERISAGal Posted June 2, 2022 Share Posted June 2, 2022 There used to be an IRS form the plan sponsor could complete and mail with the check. Although plan sponsors may no longer be able to use this method. I'm completely dating myself! Lou S. 1 Link to comment Share on other sites More sharing options...
ESOP Guy Posted June 2, 2022 Share Posted June 2, 2022 You can use Reliance Trust Company to do it all. If the client really wants to write the checks they should talk to the bank they deposit their payroll withholding or just their bank if they outsource payroll. At this point I think just about everyone is required to electronically pay withholding. That however requires someone to do things like the Form 945, 1099-R with the 1096...... Luke Bailey 1 Link to comment Share on other sites More sharing options...
K-t-F Posted June 2, 2022 Share Posted June 2, 2022 Penchecks... setup the distribution, have the money sent to them and you are done. Its not easy being green Link to comment Share on other sites More sharing options...
Bill Presson Posted June 2, 2022 Share Posted June 2, 2022 1 hour ago, ERISAGal said: There used to be an IRS form the plan sponsor could complete and mail with the check. Although plan sponsors may no longer be able to use this method. I'm completely dating myself! 😉 Form 8109-B. I think that's been gone for quite some time. I remember them fondly. Luke Bailey and Bri 2 William C. Presson, ERPA, QPA, QKA bill.presson@gmail.com C 205.994.4070 Link to comment Share on other sites More sharing options...
ESOPMomma Posted June 2, 2022 Share Posted June 2, 2022 I agree with others... PenChecks all the way. All you need to do is send them the money (and the other obvious details), they take care of everything else. Link to comment Share on other sites More sharing options...
RayJJohnsonJr Posted June 3, 2022 Author Share Posted June 3, 2022 THANK YOU ALL SO MUCH! This is why I love BenefitsLink. Is PenChecks good for 1, (one participant) Plan only? That's all I need. Also, the Schwab Account where all the money is has a check writing priveledge, in case that matters. The sole participant is a retired physician living off of this Plan. Link to comment Share on other sites More sharing options...
ESOPMomma Posted June 3, 2022 Share Posted June 3, 2022 PenChecks will easily handle a distribution for a single participant... they don't so much care how many participants there are in the plan. They simply distribute funds per your direction. Funds can be transferred to PenChecks via wire or by writing a check. There are specific instructions for each method of sending funds to PenChecks. You may want to contact them directly. @ratherbereading provided you with a link in the first reply above. Link to comment Share on other sites More sharing options...
RayJJohnsonJr Posted June 21, 2022 Author Share Posted June 21, 2022 Thank you, ESOPMomma. I much appreciate it. Link to comment Share on other sites More sharing options...
BG5150 Posted June 22, 2022 Share Posted June 22, 2022 If it's just one person, set up an EFTPS account and send the money that way. Have Schwab send the ER the withholding check and the ER uploads the info in EFTPS. Use code 945. The worst part is waiting for the PIN to come in the mail. Otherwise it's very easy. Then have the trusty TPA do the 1099 QKA, QPA, CPC, ERPATwo wrongs don't make a right, but three rights make a left. Link to comment Share on other sites More sharing options...
RayJJohnsonJr Posted June 29, 2022 Author Share Posted June 29, 2022 I Studied the EFTPS website and procedure. To convenience my client I usually do things like this for them. Am I allowed? The first question when enrolling is, business or individual or federal agency? it seems the only choice a pension plan could make is business. there is no option for a pension plan. Do you agree? The other thing is, I'll have to do this on Alabama Department of Revenue website, too, the client's resident state, but theirs is more complicated I may have to call them. Thank you for the tip BG5150. I really appreciate it. Link to comment Share on other sites More sharing options...
thepensionmaven Posted June 29, 2022 Share Posted June 29, 2022 Do you realize that by making these transactions (that the clients' accountant should be doing) you've become a plan fiduciary?? Link to comment Share on other sites More sharing options...
RayJJohnsonJr Posted June 29, 2022 Author Share Posted June 29, 2022 Well, I'm an Independent RIA, and am paid a fee to manage his investments, so I guess I'm a fiduciary already. I called PenChecks thinking it would be a waste of time. Lo and behold, for $35 they will remit the tax withholding. Fed. and State and prepare the 1099R. This pays for one tax deposit per year (Fed + State count as one), and and ancillary filings like 945 etc. Unbelievable. The truth is stranger than fiction. Thank you thepensionmaven, BG5150, and all others. Link to comment Share on other sites More sharing options...
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