Leaderboard

I agree you can't re-amortize. But if you can't re-amortize after the 5 year period has expired, why would you be able to correct with a lumpsum? I think the only payment that can be made after the maximum term of the loan is a payment that still has a cure period. I think the only options you have are 1. Deem and 1099 in the year of default (2018) 2. Deem and 1099 in the year it was discovered (2019)

I had a similar situation and billed the client. The client loved the solution.

You will need to consult with an attorney. There are lots of questions - is this your personal advisor? An advisor for the whole plan? An advisor the school hired? Not all plan advisors have the authority from the plan to actually move money. Some will help participants pick investments, fill out investment change forms etc, but in those cases it's the participant actually making the change, or instructing the financial institution to move the money from one fund to another. Also, there were 6 years from 2009 - 2015, and 4 years from 2015 to 2019, one of the first questions asked will be why didn't you notice the issue sooner?

I agree withthose who say you can file a final 5500. The amount is too small to be overly concerned. Bill them $167 for researching the issue.

Luke this is the closest I could find to "official IRS guidance" https://www.irs.gov/pub/irs-pdf/p4278.pdf

A plan that does not annually allocate forfeiture amounts may jeopardize its qualified plan status. Can you allocate it to eligible participants?

Usually the person who issues the legal opinion knows what issues are involved or research the relevant legal issues... I would not feel comfortable with an attorney who does not know this practice area well enough to know what points should be addressed.

not a problem for the broker!