5500EZ and partners

[K-t-F]

I was reading a webpage where the author of the page stated that businesses with partners can no longer use a form 5500EZ... Actually didnt state it that direct, but in essence that was the point conveyed. Is there a change for 2006 with regards to the form 5500EZ? The 2005 directions state that an EZ can be used with partners.

Thanks!

[WDIK]

Would you be willing to link to the site?

[K-t-F]

http://401kbrokers.com/FAQ.htm

I think it is the 19th question down.

[JanetM]

Well IMHO not everyone is an expert in every area relating to retirement plans. Seems like mistake on their site. I don't know of any change for 2006, but 2005 still allows partnership to file 5500EZ.

The thing that makes me sit up and take notice is they keep referring to 5500 as a TAX RETURN when it is ab information return. There is no tax due with 5500, now a 5330 is a tax return (but they don't mention this).

[Lori Friedman]

If you read the 2005 Form 5500-EZ instructions (on page 1, "Who May File Form 5500-EZ"), partners are still very much eligible to use the form. I have no idea how the website's authors came to their conclusion.

Good point, JanetM, about the "tax return" references. I also notice that the website refers to the IRS's filing rules; apparently, the author's are unaware that Form 5500 gets filed with the DOL.

[WDIK]

Although the site may be poorly worded, my guess is that it is trying to address the situation of a corporation with multiple owners (partners) rather than a partnership in the strictest sense of the word....

[K-t-F]

I read the 2005 instructions and as always saw the reference to partners. I was simply unsure if I missed any proposed new rules for the 2006 year. I didnt want to move on into 2006 with a wrong understanding of the form if indeed the rule pertaining to who can file an EZ was going to change.

WDIK.. would you expand for me on you last post? I dont have any partnerships currently but am talking to a new potential client (3 women who own a company) and will be filing a form 5500 (the assets of the plan are greater than 100k so a form will be filed). My understanding from their financial advisor is that they are a partnership . I have not received any information regarding their other professional advisors yet (lawyer or CPA) to ask questions.

Thanks to everyone for their input.

[WDIK]

WDIK.. would you expand for me on you last post?

My understanding was that the opportunity to file Form 5500-EZ was available to business parterships (which are unincorporated) and not to corporations.

[Lori Friedman]

WDIK, my all-time favorite guide, the PPC 5500 Deskbook, does a great job of describing the rule:

For purposes of filing Form 5500-EZ, a one-participant retirement plan is a plan that covers:

1. Only the participant and/or spouse of a business (incorporated or unincorporated) that is wholly owned by the participant and/or the spouse; or

2. Only partners of a partnership and/or their spouses.

Thus, Form 5500-EZ cannot be filed by a corporation with more than one stockholder unless the only other stockholder is the spouse.

So, if a corporation has multiple shareholders but just one shareholder-employee, and if the retirement plan covers only that single shareholder-employee, the plan can't file a Form 5500-EZ.

[K-t-F]

Thank you Lori (and WDIK)!! Now if we could get Manny to show up to spring training as fast as I got answers the Sox would be in good shape!

[Lame Duck]

I knew the Red Sox faithful wouldn't let me down. It's almost March and this is the first reference since the end of the 2005 season. Have you all been hibernating?

[Lori Friedman]

Have you all been hibernating?

Yes, and it's time for us to begin annoying everyone again.

[K-t-F]

There is something about the Red Sox and the Red Sox Nation. I think it is the whole idea of a team that has been around so long playing in a park that has so much history, has had so many famous players and baseball games played there.

[imchipbrown]

The ballpark became a piece of s*it so many years ago, I can't count. Slapped on a coat of paint for an All-Star Game. Added seats on the Green Monster... travesty. Then in right field. $200 a copy on a bad night. Hey, picnik tables!

Went with my Dad last September. Thought the park had been ruined since he first went in 1946. It was probably a dump by then. Never will I turn down a chance to get back into that sty. History trumps.

Too old to tear down, I guess.