Applying for a TIN for a new 401-k Plan

[KevinMc]

What is the easiest and quickest way to apply for a TIN for a new small 401-k Plan? Any help is greatly appreciated!!

[WDIK]

https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online

[austin3515]

But why bother? It's not yet required on the 5500. You can use the sponsors EIN for 5500 filings. Perhaps it is a withholding issue?

[Bill Presson]

But why bother? It's not yet required on the 5500. You can use the sponsors EIN for 5500 filings. Perhaps it is a withholding issue?

For pooled accounts, it's still a concern for identifying the assets as owned by the trust and not the employer.

[austin3515]

In what way? I have lots of pooled accounts, no separate EIN's and I've never heard of any issues?

[RatherBeGolfing]

But why bother? It's not yet required on the 5500. You can use the sponsors EIN for 5500 filings. Perhaps it is a withholding issue?

Yes, it is most definitely a withholding issue. Beyond that, the proposed changes to the 5500 is not to start requiring the assets to be held under in an account with a plan EIN, it is to start disclosing what that EIN is on the Form 5500.

[austin3515]

http://benefitslink.com/boards/index.php/topic/59917-withholding-on-retirement-plan-distributions-945-deposits/?hl=penchecks#entry265615

[RatherBeGolfing]

http://benefitslink.com/boards/index.php/topic/59917-withholding-on-retirement-plan-distributions-945-deposits/?hl=penchecks#entry265615

Yes you can use a third party (or should that be fourth if you are the third party?) for withholding, 1099's, etc.

We do it in house.

Announcement 84-40 provides that a retirement plan trust should (but is not required to) use a separate TIN.

[Bill Presson]

In what way? I have lots of pooled accounts, no separate EIN's and I've never heard of any issues?

Having investment income, dividends, etc potentially treated as employer income rather than plan/trust income.

[austin3515]

In my experience the investment provider has known that the investor is a qualified account so I've not had to deal with that, but good to know!

[Belgarath]

So is there any reason, other than for withholding/pooled account issues, to need a TIN at this point? I've been trying to think of one, and I can't.

My early training (one heckuva long time ago) was that you ALWAYS needed a TIN, but that was because 1099's and withholding were done in-house, and a lot of pooled account stuff. These days, it seems generally unnecessary. Especially now that to do it on-line, you have to have a "signature" and we wouldn't sign as the employer! (I haven't done this new on line form, but apparently you have to hold the mouse button down and actually "sign" the form.)

[Bird]

We don't get one if investments are on a platform and the recordkeeper will handle 1099s and WH.

[Bill Presson]

3 hours ago, Bird said:

We don't get one if investments are on a platform and the recordkeeper will handle 1099s and WH.

Agreed.

[RatherBeGolfing]

7 hours ago, Belgarath said:

So is there any reason, other than for withholding/pooled account issues, to need a TIN at this point? I've been trying to think of one, and I can't.

Nope, we only get them for plans that are not platform, like pooled or SDBA plans.

 

7 hours ago, Belgarath said:

Especially now that to do it on-line, you have to have a "signature" and we wouldn't sign as the employer! (I haven't done this new on line form, but apparently you have to hold the mouse button down and actually "sign" the form.)

You don't need to "sign" as the employer.  you still just get an SS-4 and keep it on file.  Then go online and identify yourself as the third party with authorization, answer a few questions, proof read your answers and hit submit.  Bada-bing bada-boom, you have the EIN for the trust.  I just did one today for a new client.

[austin3515]

Maybe I'm missing something but I have NO EIN's for any of our plans (And there are a lot).  Never had an issue.  But we use PenChecks to process withholding/1099-R's so perhaps you will agree in that situation the separate EIN is not necessary?

[RatherBeGolfing]

25 minutes ago, austin3515 said:

Maybe I'm missing something but I have NO EIN's for any of our plans (And there are a lot).  Never had an issue.  But we use PenChecks to process withholding/1099-R's so perhaps you will agree in that situation the separate EIN is not necessary?

It sounds like it.  We do withholding as a batch submitter for our clients (and 1096, 1099, 945) so we need an EIN for anyone not on a platform.

For your pooled or SDBA clients, what EIN do you use to establish the trust account?

Also curious what you would do for your non-platform plans if the IRS revives their "list the EIN of the trust" question on the 5500,

[KJohnson]

FWIW

 

https://www.irs.gov/retirement-plans/how-to-obtain-or-re-establish-an-ein-for-a-retirement-plan-trust

 

[austin3515]

Quote

For your pooled or SDBA clients, what EIN do you use to establish the trust account?

The Employer's EIN. But again, the account type is on the application, qualified 401k, so there has never been a situation where the employer is getting taxable 1099s.

Quote

Also curious what you would do for your non-platform plans if the IRS revives their "list the EIN of the trust" question on the 5500,

I'm gonna be honest here, I'm not a big Trump fan, but when he starts talking about obnoxious and pointless regulations and burdens on business, this is the kind of thing that is on my list--pointless agony for plan sponsors.  Not being able to use forfeitures for SH's was another, and a 25 page fee disclosure to even people with no money is a third (and the most galling).  Utterly pointless rules.  So if it is a requirement to get an EIN, I will comply; but then I repeat myself.  But I also think that whoever that guy is running Treasury (Mnuchen?) will set the tone such that this kind of thing will never make it. 

On the other hand, although I have no expertise in global warming regulations, I have a feeling I might lean the other way; but then, we're not trying to save the world in our industry.

Maybe this has been too political, so don't hold it against me...

[RatherBeGolfing]

3 minutes ago, austin3515 said:

The Employer's EIN. But again, the account type is on the application, qualified 401k, so there has never been a situation where the employer is getting taxable 1099s.

I'm gonna be honest here, I'm not a big Trump fan, but when he starts talking about obnoxious and pointless regulations and burdens on business, this is the kind of thing that is on my list--pointless agony for plan sponsors.  Not being able to use forfeitures for SH's was another, and a 25 page fee disclosure to even people with no money is a third (and the most galling).  Utterly pointless rules.  So if it is a requirement to get an EIN, I will comply; but then I repeat myself.  But I also think that whoever that guy is running Treasury (Mnuchen?) will set the tone such that this kind of thing will never make it. 

On the other hand, although I have no expertise in global warming regulations, I have a feeling I might lean the other way; but then, we're not trying to save the world in our industry.

Maybe this has been too political, so don't hold it against me...

No worries, it was always beaten into me that that a plan account should have a plan EIN rather that employer EIN (speaking of pooled or SDBAs).  You guys solve it by outsourcing the withholding and 1099/945 reporting so it seems that it wouldn't be an issue for you since you clearly separate the employer and the trust that way.  

I really think it is a non-issue unless they decide to require it on the 5500, or if you do withholding and reporting for the trust (1099/945).