Must a 5310-A form be filed?

[Guest Phil L]

A company sponsors two plans, a P-S and a MP plan. The trustee (not the participants) controls the investments in both of these plans. The broker mistakenly liquidated investments and paid a distribution for a particpant out of the wrong plan.

Can the broker truly fix this problem by simply transferring assets from one plan to the other? Is there a 5310-A filing required or any other notification to the IRS?

Any cite would be greatly appreciated.

[Guest Rick Butler]

The employer does not have to file a 5310-A for most mergers, spinoffs, consolidations, etc., if the plans involved do not have unallocated suspense accounts.

The instructions to 5310-A tells you who does not have to file.

[Guest Phil L]

I realize that there are exceptions in the instructions but as you can tell, none of those exceptions seem to fit.

Has anyone else ever addressed this issue?

[KIP KRAUS]

Phil:

My theory has always been, if the IRS instructions are vague, or incomplete, I do what I think makes since. It appears that an honest mistake was made, and the correct plan must make the distribution. I would argue that the admistrative error has to be rectified and would transfer the assets to do it. An admistrative error does not appear to be a reason to file a 5310-A.