Correcting Plan Number

[Guest Sieve]

It was discovered during a favorable determination request that the existing plan number is 001, while 5500s have been filed (probably since about 2002) using 002. We want the numbers to be consistent going forward, but I am concerned that if the CPA files the next Form 5500 as 001 that it will take years to get the IRS to rescind the proposed penalties generated by a letter asking where Form 5500 is for Plan 002.

I'm looking for suggestions as to the best way to go about changing the Plan # on the 5500. Should we amend 5500s going back X years, include a cover letter with the next Form 5500, or what? Any thoughts, suggestions, war stories?

[Guest cbclark]

We are in the same sort of boat. Takeover situation, two plans (one DB, one DC), both plans have the same plan number. Luckily the plans are not that old so I am leaning towards amending one plan's 5500s to change the number and hoping for the best. Any other ideas out there? I agree that just changing the plan number will probably generate a ton of useless correspondence and threatened penalties...and hysterics on the part of the client...sigh.

[BG5150]

Revised filings back to 2002 with PN 001?

[Guest cbclark]

Well luckily only back to 2008, and yes 001. Unless of course the powers that be don't want to...But I guess the logic would hold all the way back to the beginning of time if one wants to avoid the hysterics of the IRS. I might try to find a live body at the DOL and see what he or she thinks. I would love to just write a "hey oops" cover letter but we all know that the IRS would not be privy to that and would come after the plan sponsor in a righteous huff.

[chc93]

Back in Sept 2010, we filed the PS plan incorrectly as 001 instead of 002 (the 5558 extension was correct with 002). The MP plan terminated in 2002, and was 001. In Nov 2010, we filed an amended PS plan as 002. We subsequently got a late filing notice for 002. Apparently, the amended PS plan changing from 001 to 002 was not recognized as a filing for 002 which was timely filed, but as 001. There were numerous letters back and forth from Nov 2010 through June 2011. In July 2011, I got a power of attorney, called the IRS, and the agent (very polite and helpful) removed all penalties and updated their system. Maybe the best solution in your case may be to call the IRS and ask for their instruction to fix the problem.

[Guest cbclark]

Wow that is crazy! At least you got somewhere and finally cleared it up. I hate it when clients get notices, even if they are moronic garbage notices, because we look like we don't know what we are doing. I may try your suggestion about calling the IRS.

[chc93]

Wow that is crazy! At least you got somewhere and finally cleared it up. I hate it when clients get notices, even if they are moronic garbage notices, because we look like we don't know what we are doing. I may try your suggestion about calling the IRS.

I finally called the IRS because the written correspondence was going forward and backward through loops, etc, essentially going in circles. I got the 2848 power of attorney signed. Called the IRS, got put on the customary 30 minute hold, then got the IRS agent, faxed the 2848 while he waited on the phone, then he got all of the information that we mailed to the IRS while I waited on the phone, then we discussed the situation, after which he agreed with what he had, and removed the penalties... all in the single phone call. Note that a large part of the quickness in response was probably because the IRS already received all of our correspondence and documentation of the situation. In our experience, calling the IRS works well when written correspondence doesn't get anywhere.

[Guest cbclark]

I am in phone loop purgatory with the IRS. Had a 7 minute wait, got a live body who promptly shuffled me off in a transfer back to phone purgatory...where the nice robo lady informed me that my wait would be longer than 15 minutes....sigh. So here I sit, waiting for a live body again. At least I am waiting out the heavy and much needed rainstorm...if a live body doesn't pick up in a few more minutes, I will just roam on home. I won't have correspondence to discuss because I haven't filed anything yet....

[Guest Sieve]

To make sure I didn't fall into the reactive role the IRS puts us in much of the time, I took a proactive tack, and, for those who'd like to know, here's what the IRS just told me to do to change the Plan # (& yes, I waited over 40 min. on the phone):

Send/fax a letter (address, phone below), & include the following:

• Explanation of the facts (i.e., what happened & how it was discovered--including, obviously, EIN, plan name, etc.);
  
• Request that all filings be moved to the new Plan #;
  
• Request that the IRS file for the old Plan # be closed; and
  
• Request that the IRS respond in writing once the old file has been closed.
  

Address: IRS, Attn: EP Entity, Mail Stop 6273, Ogden UT 84201

Fax: (801) 620-7116

[Guest cbclark]

Thanks! I was dreading phone purgatory again. I will run this option by the powers that be and see if we can move along.

[Guest cbclark]

Sometimes researching a question is just guaranteed to create a quagmire.

For DOL 5500 purposes I have to amend the 5500s for the plan that has the wrong number. That will make either the DB 5500 wizard or the DC 5500 VERY happy (not) since it looks like the entire filing has to be resubmitted. All for an erroneous PN... Bigger issues: was there ever a PN 001 for the one I want to correct? If yes, can never ever use 001. So then the squabble could become which plan is going to be PN 003.

And of course there is no agreement on whether all 5500s have to be amended or just the most recent. I thought I read all, but my eyes are tired and my head hurts so I could have just made that up!

Any of you stalwarts have any good ideas for the DOL side now that chc93 gave us the secret IRS solution? Thanks in advance!

[Guest cbclark]

PN correction update:

I followed all the steps, and today I got an email from the client that included a pdf of a letter from the IRS. Ok this is enough to make a person decide to find another line of work...The IRS changed the pension plan PN and NOT the requested 401(k) plan PN. So now, both plans are wrong in terms of plan numbers. I sat on the phone in phone purgatory for 40 minutes, was told I needed '"Accounts" and went into round two phone purgatory. Finally got an agent, he was most helpful and sort of sighed at the magnitude of the screw up. So, phase two: send in a new letter requesting the correction of the IRS action, include the IRS letter and my original request for correction. Faxed the whole shootin' match to the dedicated fax line for EP Entity. That number is (801) 620-7116.

Luckily the client was happy we could deal with the IRS instead of them.....So let's see, I should get a revised correction in three weeks, not even going to guess if it will be the correction I sought!

[bevfair]

To make sure I didn't fall into the reactive role the IRS puts us in much of the time, I took a proactive tack, and, for those who'd like to know, here's what the IRS just told me to do to change the Plan # (& yes, I waited over 40 min. on the phone):

Send/fax a letter (address, phone below), & include the following:

• Explanation of the facts (i.e., what happened & how it was discovered--including, obviously, EIN, plan name, etc.);
  
• Request that all filings be moved to the new Plan #;
  
• Request that the IRS file for the old Plan # be closed; and
  
• Request that the IRS respond in writing once the old file has been closed.
  

Address: IRS, Attn: EP Entity, Mail Stop 6273, Ogden UT 84201

Fax: (801) 620-7116

@Sieve - How did you handle correcting the filings with the DOL? Amended 5500s? I only have 3 years of returns to amend so not a big deal, just want to make sure I cover all the bases. Thank you.

[Hojo]

Has anyone done this even more recently? Do you have any sample language of the letter to the IRS? Did you still have to go back and submit revised filngs or did they take care of it on their end?

Thanks

[Guest Sieve]

bevfair --

I have no idea. Anyone want to stay on the phone in DOL purgatory to find out & let us know? Certainly, if there are only a few 5500s that have been filed, I would think amended filings would work. It's for those with a large number that it becomes an issue, I would think.

[Kevin C]

We use the other approach. The PN is corrected on the current 5500 filing and the EIN/PN used in the prior year is noted on line 4. Eventually, you will get a letter either asking for the a filing under one of the PNs. Responding to that letter with an explanation of what happened usually takes care of it. Our experience has been that you can't correct the EIN/PN on a return that has already been filed unless you get a live person to contact.

[Calavera]

We used Kevin's approach couple times. Never had any issues with the IRS. You also need to pay attention to PBGC filing for DB plans, since there are questions about matching EIN/PN to prior year 5500 and prior year PBGC filings.

[TPApril]

Situation at hand - first time filer for welfare plan filed extension but has not yet filed. Lo & behold, it's not a first time filer as we learned that a 5500 was filed '4R' ten years ago, but under a different Plan Number. Therefore current extension had the right name, but wrong plan number.

File under which plan number?

As reflected on 5558, but might appear as if no extension filed

As reflected on last 5500, but might appear as if no extension filed

[BG5150]

File under the PN on 5558, then amend with correct PN right away?

[TPApril]

Called up IRS on this. They said to fax a request with the 5558 asking for the PN to be changed, and to file on the correct PN