Presidentially declared disaster areas- Extended deadline to establish SEPs/SIMPLEs?

[Appleby]

The October Special Edition employee plan news talks about extension for tax filing and contributing to SEPs and SIMPLEs. http://www.irs.gov/pub/irs-tege/se_1004.pdf. But I can’t find anything that states whether the deadlines for establishing the plans were also extended. Are you aware of any such provisions?

[mbozek]

Under Prop reg 1.408-7(b) a SEP can be established at any time up to the date for making the deduction (filing the tax return w/extensions).

[Belgarath]

Not specifically. But my interpretation is that since a SEP can be established up until the tax filing deadline, including extensions, that since there's a special extension for filing, it also applies to establishing the SEP.

[Appleby]

Thanks to you both. I agree.

IMO, the deadline would not apply to establishing the SIMPLE, since the October 1 deadline was put in place to allow employees sufficient time to make their salary deferral contributions for the year. OTOH, some employers (those that come into existence after October 1) are allowed to establish the plan after October 1, which suggests that even though employees would be at a disadvantage with SIMPLEs that are established after October 1, it may be allowed under extenuating circumstances…but alas, without any apparent guidance, one can’t be too sure

[Guest Moe Howard2]

Belgarath, your logic makes good sense. However, the performance of many types of acts are allowed to take advantage of a disaster relief extension, by reason of a Presidentially declared disaster,.... but establishing a plan is not one of the acts listed in Treas Reg 301.7508A-1©(1). Although plan establishment is not listed ... I don't see how the IRS could argue with you logic. I say you are correct.

Deadline for making contributions to a plan can be extended through disaster relief extension date (it's one of the acts listed in the Tras Reg).