Filed Form 5558 and now we determine 5500 is not required

[ESI2015]

In July, our team filed Forms 5558 on multiple plans that would need to be extended.

However, we had a new one-man plan that we filed Form 5558 for that didn't end up needing to file a Form 5500 because his assets were below $250,000.   Client received the acknowledgement letter stating the extension of time was received.  

Will we receive a notice stating the filing was late?  Are we better off to just wait and respond to a notice when one is received or attempt to call the IRS or write a letter in response to the extension letter?

[ESOP Guy]

I would wait but I will admit I don't work on any 1 person plans anymore so maybe someone with more experience will give their opinion.

 

As an aside (the real reason I replied) back when I did do a few we always filed the 5500 regardless of asset size.  That small of a 5500 isn't that hard or time consuming to prepare.  If you filed an extension you most likely have them set up on your form software.  We always did trust accounting even on the 1 person plans back in the day regardless.  Most importantly by filing you start a number of statute of limitation clocks.  To me so little in terms of cost/man hour(s) is saved by not  filing and so much is gained by filing. 

 

Off my soap box for this morning. 

[RatherBeGolfing]

6 minutes ago, ESOP Guy said:

As an aside (the real reason I replied) back when I did do a few we always filed the 5500 regardless of asset size.  That small of a 5500 isn't that hard or time consuming to prepare.  If you filed an extension you most likely have them set up on your form software.  We always did trust accounting even on the 1 person plans back in the day regardless.  Most importantly by filing you start a number of statute of limitation clocks.  To me so little in terms of cost/man hour(s) is saved by not  filing and so much is gained by filing. 

Off my soap box for this morning. 

Agree 100%.

[Bird]

We've done it (extended but not filed) and I don't recall any follow up.  I would not - NOT - do anything proactively.  Poke yourself in the eye if you want for similar results.

[RatherBeGolfing]

2 hours ago, ESI2015 said:

However, we had a new one-man plan that we filed Form 5558 for that didn't end up needing to file a Form 5500 because his assets were below $250,000.   Client received the acknowledgement letter stating the extension of time was received.  

As a side note, you might as well file.  The time it takes to prepare the EZ with instructions on how to file is negligible, and as ESOP Guy explained above, you start the SOL.  Also, if you find out down the road that the assets were actually higher, you can just amend and not worry about correcting for not filing in the first place.  It happens all the time.  The client forgets about an account, or the client forgets to mention that they also had a DB plan with another company, etc.

2 hours ago, ESI2015 said:

Will we receive a notice stating the filing was late?

No. 

 

2 hours ago, ESI2015 said:

Are we better off to just wait

Yes.

 

2 hours ago, ESI2015 said:

attempt to call the IRS or write a letter in response to the extension letter?

No.

[Larry Starr]

11 hours ago, ESI2015 said:

In July, our team filed Forms 5558 on multiple plans that would need to be extended.

However, we had a new one-man plan that we filed Form 5558 for that didn't end up needing to file a Form 5500 because his assets were below $250,000.   Client received the acknowledgement letter stating the extension of time was received.  

Will we receive a notice stating the filing was late?  Are we better off to just wait and respond to a notice when one is received or attempt to call the IRS or write a letter in response to the extension letter?

No, you won't receive a notice.  They don't correlate the extensions to the actual filings. And absolutely, I've been an advocate for ALWAYS filing going back to the beginning of time!