5500ez line g

[Guest bradfield]

If I had a security purchased in 2001 for a cost of $4,000, worthless and valued at zero on 1/1/07, and removed from the account as of 12/1/07, do I record a -4,000 on line g of the 5500EZ for 2007 even though it does not reflect in the change in value of the plan assets for the year 2007?

Thanks.

[WDIK]

1) Unrealized gains/losses are not reported anywhere on Form 5500-EZ.

2) Realized gains/losses are reported on line 10g of Form 5500-EZ.

3) CAUTION: Was the distribution made in accordance with plan terms, including any regarding in-kind distributions?

4) ANOTHER CAUTION: Was the asset value determined on an established market or by an independent appraiser?

[Guest bradfield]

Thank you. Extremely helpful.

[MarZDoates]

How do you report the change in value of a retirement account on the 5500 EZ?

[WDIK]

The information reported on the EZ does not reconcile the beginning versus end of year assets like Form 5500.

I would refer you to the instructions for a description of the line entries.

[Bird]

WDIK is right, and it's an important point - beginning and ending assets don't reconcile with the income and expense items reported. We interpret 10g to include earnings and realized gains or losses; the instructions specifically say not to include unrealized gains or losses. I'm not sure what the point of reporting anything is if you're going to ignore the unrealized gains, but I guess somebody had their reasons...or not, could be they just assigned this to some stoners that they couldn't fire.

[Guest Dell]

As stated already, the 5500EZ makes no sense in this area.

You still value the investments at FMV, you just dont show unrealized appreciation/depreciation. Remember, for 5500 purposes, realized gains/losses are based on "revalued cost" (FMV at beginning of year), not historical cost.

Technically, you would not have any realized loss at 2007 year-end. The asset was already written down to zero, so there can be no realized loss. It's just that that write-down never appeared on the EZ. Seems odd, but the EZ form simply does not reconcile.

In reality, it probably doesn't matter how you handle it.

[MarZDoates]

WDIK is right, and it's an important point - beginning and ending assets don't reconcile with the income and expense items reported. We interpret 10g to include earnings and realized gains or losses; the instructions specifically say not to include unrealized gains or losses. I'm not sure what the point of reporting anything is if you're going to ignore the unrealized gains, but I guess somebody had their reasons...or not, could be they just assigned this to some stoners that they couldn't fire.

Hee hee.

Thank you all.... for the clarifications! I appreciate it.