Form 8955-SSA

[Florence]

We filed an 8955-SSA for 2010 reporting 1 participant that was paid out (code D).  We were just notified by the Participant that he was informed by SSA that he had benefits due him.  Debating whether we should send a letter to SSA with a copy of the return previously filed or add said participant to the next SSA.  Has anyone run into this before and/or what are your thoughts?

[david rigby]

You don't specify the info on the relevant SSA.  If participant was fully paid out, your most important task is to locate such evidence and provide a copy to (former?) participant.  Second task it to verify correct info on next SSA.

[Bird]

Happens all the time.  You could write a letter to SSA or you could write a letter and drop it in the trash, same result.  "Just" provide evidence to the participant confirming that he was paid out (assuming that evidence exists and is easy to retrieve).  The letter really says he "may" have benefits and showing he got paid is all that needs to be done.

[Florence]

Thank you for your responses.  We did find all of the documentation in our archived files and sent a letter to the Participant.

[Larry Starr]

On 12/29/2018 at 5:59 PM, Florence said:

We filed an 8955-SSA for 2010 reporting 1 participant that was paid out (code D).  We were just notified by the Participant that he was informed by SSA that he had benefits due him.  Debating whether we should send a letter to SSA with a copy of the return previously filed or add said participant to the next SSA.  Has anyone run into this before and/or what are your thoughts?

To make it clear, the Social Security Administration couldn't care less whether he was paid out or not and doesn't want to hear from you.  They are tasked with putting the info from 8955s into their system and feeding back what they are told many years later. If the participant is not removed via an 8955 filing, SS will just tell the participant at some time that they MIGHT have money due them.  As has been noted, the necessity is to tell the employee he has been paid out.  It is great if you have the details, but even if you don't (and that happens: say a take over where he was paid many years ago and is never reflected in the records from the time you take over the plan), you can still say "our records show you are not currently entitled to any payments from the plan" and that is all you have to say.  We have had clients have to do that a number of times.

Yes, you might have an argument form the participant, but the participant would have to sue and prove they are entitled to something since the plan records are given deference. Where are their benefit statements from the plan for all these years?  They won't have them because they were paid out many years ago.  FWIW.

[chc93]

2 hours ago, Larry Starr said:

To make it clear, the Social Security Administration couldn't care less whether he was paid out or not and doesn't want to hear from you.  They are tasked with putting the info from 8955s into their system and feeding back what they are told many years later. If the participant is not removed via an 8955 filing, SS will just tell the participant at some time that they MIGHT have money due them.  As has been noted, the necessity is to tell the employee he has been paid out.  It is great if you have the details, but even if you don't (and that happens: say a take over where he was paid many years ago and is never reflected in the records from the time you take over the plan), you can still say "our records show you are not currently entitled to any payments from the plan" and that is all you have to say.  We have had clients have to do that a number of times.

Yes, you might have an argument form the participant, but the participant would have to sue and prove they are entitled to something since the plan records are given deference. Where are their benefit statements from the plan for all these years?  They won't have them because they were paid out many years ago.  FWIW.

This is my problem with the IRS and Form 8955-SSA.  The Form 8955-SSA was filed properly noting the Code D for the participants fully paid out to remove them from their system.  Then years later, the participant gets the letter from the SSA.  Why do they make us go through this if they can't keep their system "straight".  The OP is not the first time we've seen this... <sigh>

[Larry Starr]

20 hours ago, chc93 said:

This is my problem with the IRS and Form 8955-SSA.  The Form 8955-SSA was filed properly noting the Code D for the participants fully paid out to remove them from their system.  Then years later, the participant gets the letter from the SSA.  Why do they make us go through this if they can't keep their system "straight".  The OP is not the first time we've seen this... <sigh>

Your error is in expecting government (or any mutual fund, insurance company, etc...) to do anything right.  We long ago accepted the fact that they won't (do anything right) and no longer take it personal. We tell clients the same thing ("... as good as Vanguard is for handling your money, never call them to ask them anything: you will most assuredly get the wrong answer!"). ALWAYS CALL US FIRST.