One Participant Plan - Eligible for EZ?

[Guest ggbrock]

We're trying to figure out if a profit sharing plan qualifies for EZ. The owner of the biz owns 100%, he is the only person with an account. The plan hasn't made a contribution since 1990. However, the company does have 7 employees that would appear to be "eligible" to participate (based on language of plan) although they have never received any contributions. The PPA 1103 states that the plan must "cover" only one individual at the beginning of the plan year. Could these other 7 individuals possibly be construed as being "covered" under the plan even though they have never received a benefit and the plan has been effectively frozen for 10 years? Any thoughts are much appreciated. Thank you.

[rcline46]

The other employees are covered under the rules of the plan, no EZ.

No contribution for 10 years? This is a terminated plan unless the owner can prove no profits or other hardship caused by contributions.

[Bird]

They are participants and a regular 5500 is required.

[BG5150]

They are participants and a regular 5500 is required.

...for every year any of the other seven people were deemed eligible under the plan.