Control Group Defined

[Guest SuperRob]

Client has solo 401k plan well under the $250,000 threshhold. From the short reading it appears he does not have to file. But I was told by the administrator, a year late that he needed to file one because of the control group.

I'm not a CPA, just want to make sure my client is given accurate information.

SuperRob

[rcline46]

Note that a controlled group for TAX purposes is not the same as a controlled group for PLAN purposes.

Note 2 - if there is a controlled group I would bet there is also a large discrimination issue with the solo k!

You need more information fast on this case.

[maverick]

Page 2 of the 2007 instructions for 5500-EZ (who may file form 5500-EZ) indicates that an EZ can be filed if 5 conditions are met, one of which is the plan does NOT cover a business that is a member of an affiliated service group, controlled group of corporations, or a group of businesses under common control. It goes on to say that if the 5 conditions are not met, "...file Form 5500 instead of Form 5500-EZ.". There is no exemption from filing a 5500 if the assets are < 250k. Sounds to me like a 5500 is required.

Maverick