Form 5500-EZ filing

[Guest pmetallic]

An sole proprietor had a profit sharing and money purchase plan put in place for herself years ago. She is the only participant and her combined assets exceeded $100,000 about 9 years ago. She has never filed the Form 5500-EZ. As I understand, the statute of limitations goes back 6 years but that would expose her to a potential penalty.

Another thought is to file the latest 5500-EZ and roll the dice. Does anyone have any experience with the consequences to a backfiling like this or ignoring the backfiling and just filing the most recent return?

[Bird]

We handled one of these about a year and a half ago; filed all the returns and got the penalties waived.

The return asks for beginning of year assets and I would think they would have some validation built in to assure that it's not a first filing if assets are over $100,000, but you never know. If you have two plans, each under $100,000...hmmmm, I seriously doubt that they coordinate the two beginning balances. I was going to go on a minor rant about it being an ethical challenge, but it's not like you're preparing fraudulent returns.

[jquazza]

You don't have a statute of limitation on 5500 if you didn't file the form. Filing the schedule P with your 5500 triggers the SOL.