Changing EIN'

[austin3515]

If in 2010 we find out that the EIN used in 2009 has changed (during 2010), what I've been told by 3 separate people at the IRS is that you need to:

1) Use the new EIN for the 2010 5500;

2) Indicate the prior EIN on line 4 of the 2010 5500 (i.e., last year this plan was repoted under the following EIN)

3) Here's the kicker: amend the 2009 filing to mark it as a final 5500.

Without this 3^rd item, they keep telling me that there is no way for their system to NOT look for a filing under a particular EIN if that form was not marked as final. If 3 people didn't tell me the same thing I wouldn't believe it…

Has anyone else had a similar experience?

[Andy the Actuary]

All I can think of is bad things happening to good people. You will have marked the 5500 as final and if the plan is subject to PBGC coverage, the PBGC could eventually come back and inquire why you didn't go through the standard termination process. I envision paper audit trigger reports being generated by the 1,000s and threatening letters being mailed out without a human ever reviewing the facts and circumstances.

Perhaps, the biggest question is if you have to show the old EIN on line 4 but amend the 2009 form to show final, what do they use the line 4 information for? Despite electronic this and electronic that, the IRS (I suspicion) will always be looking for the client to provide the paper trail on audit because their rules are too complicated and in flux to program for electronic tracking.

a.t.a. (sporting bad attitude of the day)

[austin3515]

It's a DC plan, and they all told me, systematically, the only way to supress that letter is to mark the 5500 as final...

[Andy the Actuary]

If the 2009 report is marked final, should the 2010 report be marked "first"?

As Jack Benny would have uttered, "Wellllllllllll"

[Bird]

Let us know how far you get when you try to file a final return on a plan that still has assets.

[austin3515]

BElieve me, you're preaching to the choir...

[EBDI]

For what it is worth, I changed the EIN for clients in the past and never marked the prior year as the final return. I did enter the prior EIN on line 4 as suggested. It worked for me, but maybe the rules have changed.

[austin3515]

same exact situaiton... NEver come ujp before, but again, several people from the IRS told me the same thing

[movedon]

Yep, I've seen this a couple times - played out as follows. 5500 from several years ago was properly completed showing change in EIN. IRS contacts client (couple years later) telling them (after much silly correspondence - I'm really cutting to the chase here) to amend the last 5500 that used the old EIN to show it as a final return. Can't remember if the subsequent 5500 was supposed to be amended to indicate it was a first return - I'm thinking not. Anyway, I argued with the client and some IRS phone jockeys quite a bit before I gave up and just amended the return. Never heard anything after that, so I guess it worked. I still probably wouldn't do it that way in the future - I'd do it the way I think is right and only change it if the IRS asked me to, even though it's more work. Turns out I'm more hard-headed than lazy. I had my money on lazy.

[Andy the Actuary]

Bottom Line: AP was punished for asking!

[Lou S.]

For what it is worth, I changed the EIN for clients in the past and never marked the prior year as the final return. I did enter the prior EIN on line 4 as suggested. It worked for me, but maybe the rules have changed.

We have done this too with mixed results

Some have worked like a charm, others a few years later we get a "late/non filing" notice on the old EIN.

Usually solved with a quick letter and a copy of the filed 5500 with item 4 circled.

[austin3515]

We tried the letter and included the freeerisa 5500 demonstrating that it had beenc omplied with. We had the IRS on the phone and told them about the letter and they acknowledged the letter, but flat out told us the only to make it stop was the amended 5500 marking it as final.

Your federal government hard at work... How they could not be on the same page on this is quite something.

[masteff]

Sounds to me like a lack of system programming resources at either EBSA or IRS to make the Line 4 EIN change work correctly for the prior EIN. They've finally admitted to themselves that it isn't getting fixed any time soon so the "manual workaround" is making their customers file amended returns.

If you do the amended "final" return, I'd add an attachment with a short narrative stating "EIN changed in 20XX, this is final under EIN XX-XXXXXXX, future Forms 5500 will be filed under EIN XX-XXXXXXX". This way you have double cross-reference: the old references the new and the new references the old.

[austin3515]

With attachments these days though I'm a little more apprehenisve since it is SO public... At least on Free ERIS no one could see any attachments,. Aklos, I have a hard time believing anyone would read the attachment even if you dutifully attached it. Instead, I believe they would send out whatever form letters they want to send out.