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Showing results for tags '4979 '.
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Good morning, I was wondering what other practitioners are doing regarding the calculation of the excise tax for failing to correct ADP/ACP failure prior to the 2 1/2 month deadline. The EOB says that the 10% tax is calculated on the excess deferral or excess aggregate contributions prior to the G/L adjustment, but the 5500 Preparer's Manual says that the tax is calculated after the earnings adjustment. So are your calculating the tax before or after the G/L adjustment? Thanks in advance!
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I am trying to figure out whether the 4979 excise tax on excess contributions applies only for one year or whether it applies for each subsequent year until the ADP failure is corrected. I have looked at the statute and the regulations, but they don't make this clear. While there is lots of commentary out there about the 6% excise tax on IRA excess contributions applying every year until correction, I can't find anything suggesting that this would be the case for the 4979 excise tax. I'm beginning to think that means the 4979 excise tax applies only for one year. Does anyone have any thoughts on that or know where there may be more guidance on this? Thanks in advance!
