Filing requirement?

[Guest Tbrown]

I just took on a new client and I'm trying to determine the filing requirement for 2002. It is a 401(k) profit sharing plan and the original document was effective 1/1/2002. The sponsor did nothing in 2002. He never established an investment account. He never gave the participants any notices or spd's. There was literally nothing done. Finally in July of 2003, he established an investment account and rollovers for 5 participants were deposited. There will be no other activity for 2003.

My question is, does he have a 5500 filing requirement for 2002?

Tim

[Archimage]

Since the plan was in existence in 2002, a 5500 is required.

[jquazza]

Tim,

I agree with you and I prepared few 5500s for clients in the same situation. Guess what? I got a DOL letter for every single one of them. EBSA doesn't like getting a schedule I with nothing on it. It's nothing major, but forewarning the client might be advisable.

In this particular case, since nothing was communicated to employees, you might argue that the company didn't have a plan in 02 and file 03 as the first return.