RatherBeGolfing

I have always heard #2, and honestly didnt even consider #1 😄

100% this! Of course it is taxable. If there was no withholding you report no withholding. Lets go back to the ABCs of CRDs, ANY DISTRIBUTION (with a few exceptions like corrective distributions) can be a CRD. The 1099-R reports the transaction. The tax treatment of the distribution will be determined based on the taxpayer's filing of Form 8915-E. You can have a CRD from the plan with no withholding, but unless the taxpayer makes certain elections and files Form 8915-E, it is taxed like any other distribution. BTW, marking it with code 2 on the 1099-R will mean absolutely nothing unless the taxpayer also files Form 8915-E. And if they do file Form 8915-E, it doesn't matter if the 1099-R is coded as a 1 or a 2. Finally, imagine the following scenario: Taxpayer is a participant in two plans, and takes a $100,000 CRD with no withholding from each plan. Both plans have followed the rules, and will need to report the distributions accurately. Taxpayer can only treat $100,000 as CRD for preferential tax treatment, and treatment that treatment is entirely up to taxpayer. Why in the world would either plan report anything other than what happened?

The OP was something along the lines of ER releases contributions to TPA timely, but TPA for some reason takes X number of days (or weeks) before it deposits the contributions to the participant accounts, is this a late contribution for Form 5500 purposes?

Yes. Starting with 2020 Form, 2% shareholder treated as partner for annual filing purposes. See prior thread for more detail

It doesn't make any sense for them to be that pushy about a filing that might not be required. Even if you are required to file an 8955-SSA on July 31, 2020, its completely possible for you to no longer be required to file when the extended deadline comes around. In that case, extending beyond July 31, 2020 and ultimately NOT filing is exactly what you are supposed to do.

I haven't seen this letter, but it sounds like the IRS notice generator needs tweaking. No check boxes or anything on the letter? I have seen some recent DOL correspondence stating that they have no record of a 2019 Form 5500, requesting a response in 15 days.

👍

POA and submit as practitioner?

I saw that too. On mine it says "featured post" and "[user] featured this post" so I think its an option for the mods

Good question. 1103 didn't change the definition of an employee benefit plan, it directed the Sec of Treasury to modify the requirements for annual filing purposes. I think you can argue it both ways, but I would stick to what the instructions were in 2016 and file DFVCP with an SF.

I believe the exception is for events that are unforeseeable or beyond control of admin. Agree that change in TPA might qualify.

New EPCRS is "in the works", and I think this is one of the driving issues. No word on when we can expect it as far as I know.

I like it so far, it is "softer" on the eyes and easy to read on my laptop. I especially like how longer quotes default to a condensed view that you can expand, this makes it a lot easier to read for those of us who like to use several quotes in one reply. Also, if you use the @ {user} function, the inserted user name is easier to read. I haven't tried mobile or custom stream/view functions yet

As long as accountant deposited it as a 2020 tax liability, you wont have any problems. If accountant deposited it as 2021 tax liability, you will get IRS love letters.

Happy accident. We were working on missing participants, but since Janice was the 5500 guru I asked her for advice on an S corp issue. She was always very generous with her time both before and after retirement.

I think @C. B. Zeller laid it out perfectly. The 2020 Instructions reference 1372(b), which reference attribution under 318, so a 2% owner via attribution should be treated as a partner.

Here is what happened: PPA §1103 directed The Secretary of the Treasury to modify the requirements for filing annual returns to ensure that one participant plans with assets of less than $250,000 need not file a return for that year. §1103 also modified the definition of a “one-participant plan” to treat 2% S-Corp shareholders as partners for annual filing purposes. PPA §1103 did NOT amend the definition of an employee benefit plan. DOL regs treat a shareholder (no S or C distinction) as an employee if there are two or more shareholders who are not spouses. As of 2019, IRS and DOL had not implemented or issued interpretive guidance in regards to the 2% shareholder issue, so the instructions had never been changed. We have Janice Wegesin to thank for the 2020 change we are discussing. While she had retired a few years earlier, I had a chat with her about this back in 2019. She reached out to an IRS contact who happened to be working on the 2020 instructions.

Agree on both points

Technically, 12/30/2020. Id be surprised if they deny people with 12/31/2020 distributions though

I know this was directed at @Bird, but I'll add my thoughts as well. @Bill Presson is correct that money in an account due to an uncashed check is a plan asset. It doesn't matter whether it sits in the plan's account or if the financial institution holds it in a different account until it clears, it is a plan asset. In situations where the check is issued in December and clears in January, or we know that $xx.xx of trailing dividends will hit in January, I have no problem making the accounting work so that liabilities cancel out assets, and we can avoid a new plan year just for the sake of a slow clearing payment or trailing dividends. When those events start taking longer and longer, going in to February, march, or beyond, it loses any nexus it had with the prior plan year. I would not treat a check clearing in March as no plan assets on January 1. I believe it was mentioned in another thread that "client does not want to file a Form 5500 for an additional year". I think we all know that what the client wants to do or does not want to do in regards to reporting and disclosure is irrelevant.

This. It needs to be a a third party appraisal, and it needs to be FMV.

And here I would have guessed Teamsters...

Well said.

I'll second FTW. Software is easy to use. You can do them one at a time or a batch upload using a csv. The distribution tracking system is great, and if you use it correctly throughout the year, you just push the data to the 1099 module. You'll have them all done in a half a day. Ask them for a demo, Holly is awesome and can answer all your questions. They also have the best customer service in the business. If someone isnt available when you call, they call back quickly.

The rule is an individual NOT more than 10 years younger than the decedent. If the age difference is 10 years or less, the beneficiary may use his or her own life expectancy instead of the 10 years. And yes, once a child reaches majority the 10 year clock starts.