WDIK

Are there other employees eligible for the plan?

The 402(g) limit is for an individual. You total all salary deferrals to all 401(k) plans. The 415 limit applies to the plans of each employer/sponsor separately.

26 U.S. Code § 3405 - Special rules for pensions, annuities, and certain other deferred income (c)Eligible rollover distributions (1)In general In the case of any designated distribution which is an eligible rollover distribution— (A)subsections (a) and (b) shall not apply, and (B)the payor of such distribution shall withhold from such distribution an amount equal to 20 percent of such distribution. (2)Exception Paragraph (1)(B) shall not apply to any distribution if the distributee elects under section 401(a)(31)(A) to have such distribution paid directly to an eligible retirement plan. (3)Eligible rollover distribution For purposes of this subsection, the term “eligible rollover distribution” has the meaning given such term by section 402(f)(2)(A).

Is it inappropriate to share the name of the "large, well respected software provider" on a forum like this?

I appreciate the comments. These are the same points that concerned me, and I am glad to be in good company.

Following is an excerpt from an online article prepared by a law firm. Although it is outdated, I can confirm that they are still taking this position. I understand it for sole-proprietors but not for others. Have I missed something? I appreciate the exepertise represented on this forum. "Both employee [emphasis added] and employer contributions can be made up until the company’s tax return deadline including extensions. If you have a sole proprietorship (e.g. single-member LLC or schedule C income) or C-Corporation, then the company tax return deadline is April 18th, 2022. If you have an S-Corporation or partnership LLC, the deadline for 2021 contributions is March 15th, 2022. Both deadlines (March 15th and April 18th) to make 2021 contributions may be extended another six months by filing an extension. This is a huge benefit for those that want to make 2021 contributions but who won’t have funds until later in the year to do so. While employee [emphasis added] and employer contributions may be extended until the company tax return deadline, you will typically need to file a W-2 for your wages (e.g. an S-Corporation) by January 31st, 2022. The W-2 will include your wage income and any deduction for employee [emphasis added] retirement plan contributions will be reduced on the W-2 in box 12. As a result, you should make your employee [emphasis added] contributions (up to $19,500 for 2021) by January 31st, 2022 or you should at least determine the amount you plan to contribute so that you can file an accurate W-2 by January 31st, 2022. If you don’t have all or a portion of the funds you plan to contribute available by the time your W-2 is due, you can set the amount you plan to contribute to the 401(k) as an employee contribution, and will then need to make said contribution by the tax return deadline (including extensions)."

What was the liquidation date? If the timing were to work out with an extended filing due date, I would wait until the 2023 is available. If not, I don't have a great suggestion.

We are also starting to receive calls and emails from some of our clients who have received similar notices.

Inflation is affecting all of us.

If a nonowner employee is a participant at any point during the plan year, Form 5500-SF should be used.

My two cents about your two cents mirrors CuseFan's advice: file the final return for the 6/30/2022 PYE.

In past years, Form 5500-SF could be used for an owner-only situation if the return was going to be submitted electronically. That is no longer the case. Now a Form 5500-EZ is required.

Aren't total annual additions limited to 100% of wages? The $28,100 would exceed that limit.

A possible downside of waiting on the $650 deposit,and using the 945-V in January is when a second participant receives a distribution in November with tax withholding of $2,000. Now the total annual tax withheld exceeds the $2,500 limit and the deposit of $650 is late and generates penalties.

I am curious if anyone has run into a similar situation as a colleague of mine. Plan assets are well below the $250,000 filing requirement, but Form 5500-EZ has always been filed. For the 2020 plan year, a filing was made after the extended due date. The IRS has assessed an extremely large penalty. When my colleague spoke with the IRS, he was told that since the form was filed (even though it was not required), the penalty applies. The IRS representative did offer the option to write a letter asking for the penalty to be waived but gave no guarantee of relief. This makes little sense to me. (I know, what else would you expect from the IRS.) What do the rest of you think?

Is this the position of the IRS as a whole, or a suggestion made by a single agent? While it may solve the issue, that just doesn't seem like the proper way to handle a change to the plan sponsor.

I got my first call from a client about a deactivated trust identification number this morning. My days could be so dull were it not for the intervention of the IRS.

Has anyone else become acquainted with a letter like the one attached? A summary of the situation: The plan terminated and filed a final, short-year return for 2018. 2018 was the only plan year with any plan distributions and 945 withholding to be deposited. The IRS indicates that they are missing Forms 945 for 2016, 2017, 2019, and 2020. (At least they have record of the 2018 form, which from my experience is not always the case, even when they are sent in properly.) The instructions seem pretty clear that you "don't have to file Form 945 for those years in which you don't have a nonpayroll tax liability." I would probably be laughing about this if it hadn't given my client a heart attack. How ridiculous!! (Edit: I don't yet know the results of the scheduled telephone call.) Scan_2022-01-06-100720871.pdf

Is it possible that the owners want their benefits in separate plans, so the total amount of benefits is not disclosed to their employees on the summary annual report?

But then again...What Do I Know?

The first due date will be September 30th, 2020, not September 7th.

I do not have the same understanding. However, it is likely that an explanation will be requested if the plan is in the system and future filings are not made.

Why do you need to file an extension for the 2019 plan year at this point?

Can you clarify the plan year ending date?