Sole-P did not file 5558 for 2006 - Options?

[Bruddah Kimo]

Aloha! I have a new client who thought her prior TPA was filing her 2006 Form 5500. She found out yesterday that nothing has been done. She's asking if we can prepare the 2006 5500 and wants to know her options.

Facts:

1) Client is a Sole-Proprietor with a 401k PS Plan - 8 participants

2) Plan has over 300K in assets

3) No Form 5558 was filed

4) Plan was eff 1-1-2000 (so it's not new...)

Any insights on how to approach this situation? Do we just file with the TSL (tear stained letter)?

Mahalo nui!

[Bird]

So 5500s were filed prior to 2006; that's the only year that's late?

First, see if the sponsor had an extension for her personal return; a business extension can be used for a plan return and since she's a sole prop she = her business.

Other than that, I don't think you have much choice but to file under the late filer program; $750 max penalty for one year. I don't think a TSL works anymore except for EZs.

[Bruddah Kimo]

So 5500s were filed prior to 2006; that's the only year that's late?

First, see if the sponsor had an extension for her personal return; a business extension can be used for a plan return and since she's a sole prop she = her business.

Other than that, I don't think you have much choice but to file under the late filer program; $750 max penalty for one year. I don't think a TSL works anymore except for EZs.

Thanks Bird - the Sole-P did file for an extension on her personal return (I forgot to add that fact). That means she has until 9-15 (plan has a calendar year plan year) to file the 5500 - right? So if I can pull together and file b4 9-15 all is good, right?

2006 is the only year that is late (so far as I know...)

[Belgarath]

Here's a link. And if you get this filed relatively soon, you will come in well under the $750.00 max. Say they were filed by the end of next week, that's what - about 18 days, so $180.00. Not quite so bad.

http://www.dol.gov/ebsa/newsroom/0302fact_sheet.html

[mwyatt]

Technically, a sole prop files an initial extension to 8/15, and then can apply again all the way out to 10/15, so you should be set (but make sure that they file that second extension, which is usually par for the course). Corporations extend out to 9/15. So in essence, since she did file the extension on the personal return, your 5500 isn't late.

[Earl]

I thought the 8/15 deadline went away.

Doesn't the 4868 give you 6 months now?

So the Sole Prop has until 10/15, I think.

[Guest mjb]

The only extension for individuals filing a 1040 is an automatic 6 month extension from 4/15 to 10/15.