Schedule C for 2009

[Below Ground]

I am usually pretty good with keeping up to date. On occassion, one slips by. The new Schedule C snuck up and bit me hard!

Client pays me $1,000. Money does NOT come from trust assets. This fee must now be reported on Schedule C?

Suppose that a client pays me $3,000 for services. In addition, for processing distributions I get $100 from trust assets. These both need to be reported on Schedule C? Am I right in concluding that getting any direct compensation requires that indirect compensation must be reported on Schedule C?

What is the criteria that determines what is reportable indirect compensation? Where can I find details about the reporting to the client about indirect compensation that exempts this compensation from Schedule C?

What about compensation that is already reported on Schedule A? Do I need to again report the broker's commisions on Schedule C?

Sorry about imbedding so many questions, but I really was caught napping on this one.

[Below Ground]

Oh, I found some stuff. Here's one very interesting item I found....

Q37: If a plan sponsor pays a third-party service provider on the plan's behalf and seeks reimbursement from the plan, should the Schedule C reflect a direct payment from the plan to the service provider and not a payment to the employer?

Yes. When a plan sponsor pays a plan third-party service provider and then seeks reimbursement from the plan, the Schedule C for the plan should reflect a direct payment from the plan to the service provider. In this regard, direct compensation is defined in the instructions for purposes of Schedule C as ”[p]ayments made directly by the plan for services rendered to the plan or because of a person's position with the plan” and excludes ”[p]ayments made by the plan sponsor, which are not reimbursed by the plan . . . .” The Department notes that if the plan sponsor pays a service provider directly, and does not seek reimbursement from the plan, such payment does not need to be reported on the Schedule C.

So, if my fee is paid by the Plan Sponsor and there is no reimbursement from the fund, no reporting applies?

[Bird]

So, if my fee is paid by the Plan Sponsor and there is no reimbursement from the fund, no reporting applies?

Correct. There was a recent Sungard Relius Technical Update exactly on point. It also says that something reported on Sch A does not also go on Sch C.

[Belgarath]

BUT - you must consider the total Schedule A payment, plus anything otherwise reported on the Schedule C, to determine whether you reach the 5,000 reporting threshold. Example, 3,000 on Schedule A, 3,000 additional direct or indirect compensation subject to Schedule C reporting. Even though 3,000 doesn't reach the threshhold, the total of 6,000 does, and you would report 3,000 on the Schedule C.

[david rigby]

From Relius:

http://www.relius.net/News/TechnicalUpdates.aspx?ID=496

[Below Ground]

Thanks to all. I was really freaking out about this. It seems that I did so for no reason. Again, thanks.

[SMB]

Below Ground,

Also, Sch. C only required for "large" (i.e., 100+ participant) plans.

[Below Ground]

Thanks.