Plan Id and EIN on the 5500

[PainPA]

I was asked to look at a plan(s) and came across some unique situations and was wondering what FLAGS these concerns would raise:

1) The existing "main" plan is id 002 (Profit Sharing only - trustee directed). Old plan 001 was a MPP back in 2002 (MPP source is segregated properly). A payroll company opened a 401k plan for the NHCE's in 2006 under 001. Is 001 OK? Does this need to be changed to 003? The TPA of plan 002 does not know anything about 001 being opened... either did their accounants...

2) Plan 002 is using an EIN from a long time ago (est 1998) before it switched/merged to an LLC. The new 401k (plan 001) is using the correct EIN. Does changing plan 002 to the correct EIN raise any flags? and or should any corrected filings be made with the correct EIN for all those years?

Thoughts from anyone?

Thanks

[JanetM]

my view

1) Payroll company opened plan for NHCE with out the employers input? YIKES! This really isn't good thing, who has been signing the 5500?. If the ER continues the 401k plan it should be plan 003. You need legal counsel to fix this IMHO. You could amend PS plan to allow deferrals and them transfer the funds from bad plan 001 to plan 002.

As an aside, were the accountant doing tax reconcilations with payroll? How could the company have 401K and the accounting folks not notice?

2)No flags that I know of. Happens alot around our company, be buy and sell companies all the time. We assume and pass off sponsor ship quite often.

[PainPA]

Thanks for your insight JanetM

Needless to say we have been talking Fiduciary responsibility. The doctors did not care about the 401k even though they knew about it and sponsored it and were signing it. The trustee on the reporting has a payroll clerks name. Great opportunities for us.

Once the dust settles I plan on merging the 001 to the 002 and make the 002 with participant directed accounts, and of course keep the personal brokerage accounts in tact for the doctors.

The lead accountant was very surprised and was adamant that they did not have a 401k.

The underlying question in part #2 is that they were filing a 5500 for so many years with a EIN that did not exist. Is that OK ? Should all those previous filings need be amended?

[JanetM]

for 002 - I would just fix prospectively. This is small plan and won't draw attention by the change. I you feel nervous - sure you can go back and amend.

The Plan EIN should be the same as the employer. If the EIN should have changed in 1998 you can't amend that back to original change date. I think what is more important is that the sponsor of the plan was named correctly in the documents. Does the LLC sponsor the plan?

[PainPA]

Thanks for your helpful insight... your ideas confirm what I was thinking... it is good to hear it from another person in the business.

Yes the LLC is the sponsor.