Contribution Due Date Fiscal Year vs. Calendar Year

[erinak03]

I have a client with a 3/31 YE profit sharing plan. The plan sponsor has been a C-Corp, also with a 3/31 YE. In 2013 the owners created a new S-Corp with a 12/31 YE and this new S-Corp is the plan sponsor for the profit sharing plan. I know that, for the 1/1/13-12/31/13 tax year, the S-Corp cannot deduct any contributions as the 4/1/13 - 3/31/14 plan year had not ended so the contribution they accrue for PYE 3/31/14 will be deducted on 2014 corporate tax return. Here is my question: when must that contribution be made? My initial thought was that it is based on the plan sponsor's tax return due date (so 9/15/15 with extension). However, we would accrue on the plan's books a $100k receivable as of 3/31/14 and then accrue the next year's receivable of $100k as of 3/31/15 before the original accrual is paid off on 9/15/15. Will we just be carrying two years' worth of accruals until the plan terminates?

[shERPA]

Under 404, the general rule is that PS contributions are deductible when made. Under 404(a)(6) if the contribution is made by the extended due date of the return for the sponsor's taxable year and is "on account of such taxable year" it is deductible for that taxable year.

Note this is driven by the employer's year, not the plan year (as is the 25% deductible limit based on fiscal year comp, not plan year).

You says that the S-Corp cannot take a 2013 deduction for the 3/31/14 PYE. When did the S-Corp adopt the PS plan? Seems to me if the S-Corp adopted the PS plan no later than 12/31/13, it can take a deduction for a 2013 timely made contribution even if it is allocated for the 3/31/14 PYE.