Deduction taken before document is done and tax return is filed without extension

If this was discussed before, my apologies. This is unchartered territory for me.

Helping a CPA friend.

For a new db plan effective 1/1/2022 that is still not adopted as of today.

One of his clients deposited 200k into an account by 4/18/2023 and filed the 2022 tax return without an extension.

I do not understand how the broker accepted this deposit without an executed plan/trust document.

This client's actuary either never told him about the document deadline or did not do it or dropped the ball or there was a miscommunication, who knows. I do not have all the facts.

So, the bottom line, there is no plan document signed by 4/18/2023 and prior to any deposits.

Apparently, the actuary is now trying to file form 5300 for an "advanced determination on the qualification of the plan", whatever that means.

Are there any corrective measures that can be done here? Assume no resolution was signed by 4/18/2023.

Thanks in "advance".

Besides unwind the deposit because he didn't have a plan, and file an amended tax return not taking the deduction?

And/or refer him to qualified ERISA counsel?

This is not one of those situations where self-correction can be applied, correct?

I already mentioned attorney was looking for some options I did not think of/know.

I don't believe this is a self correction issue if by self correction you mean get a plan installed for 2022 and take a valid deduction. You have no plan by the due date it was required to be adopted.

In total agreement on that. I guess no way out of this.

One thought, how about VCP?

If there's no plan (or trust) established, then that 200000 is just more personal or business assets, right?  So I'm not sure where VCP comes into play, since there's no plan.  I think he just amends the return, pays the taxes, and tries again next year.

Thank you both for your input, I am in 100% agreement.

The IRS position, as amended by SECURE 1.0, is that if the plan is not established by the due date of the tax return for the year in question, there is no trust and therefore, there is no plan. I agree with Bri, that the return would be amended to undo the deduction and start again with adopting a new plan document, hopefully on or before the due date of 2023 tax return.

Sometimes there is other evidence of legal adoption, e.g. board minutes (not backdated). But even then you'll have to argue with IRS if the document isn't signed. Otherwise I completely agree with the above comments.

Unfortunately, there is no such evidence, at least none that was presented to me. I am aware in some instances, there was a resolution or certificate of actions with the intent of setting up a plan and the document being signed later. But not sure about the circumstances. I do not like it though.

Not sure what they decided to do.

Thank you all again for your input.