Trust EIN... yes or no

[K-t-F]

I have always applied for an EIN on behalf of any plan that I establish. I was told today that that is not necessary. That on the Schedule P where it asks for the Trust's EIN I would simply put in the corporate EIN.... Have I been adding a step to my plan establishing process? My feeling was that the trust needed it's own separate EIN in the event of a distribution and taxes were withheld.

[ljr]

You need one for registration of assets unless you have a corporate trustee. You do not want plan assets registered in the employer's EIN.

[WDIK]

Personal Opinion Only:

I prefer obtaining a separate identification number for the trust if it is anticipated that the plan (rather than a bank trustee, insurance company, etc.) will be responsible for the payment of distributions, withholding thereon and preparation of 1099-R's. This avoids confusion with other tax deposits of the employer that sponsors the plan.

If there will be a bank trustee or other entity that deposits the withholding under their own identification number, I will usually forgo obtaining an identification number for the trust.

Once (before ID numbers were obtained by fax) a representative refused to issue us a separate number for a trust and told us that we had to use the employer's identification number. (Only once.)

In another instance, an unrequested identification number was issued for the trust based on a letter trying to explain why some of the taxes paid under the employer's number was for payroll taxes and some for retirement plan withholding.

[pmacduff]

I think it is a good idea because we just had a client where the client files payroll taxes electronically, but had to deposit the single 401(k) withholding from the ONE distribution this year with an 8109 coupon (payroll company would not do it for obvious reasons). I know we could have filed the $ with the #945 (it was under $2500) but the client wanted to remit the $$ asap (back in June). The IRS slapped them with a fine for not filing electronically as they are required to do for payroll $ and said for them to obtain a separate Trust ID # for the 1099-R forms/945 filings for the Plan (which they have since done!!!).