One participant plan if it used to cover none owned

Should form 5500EZ be filed if it currently covers only the owner. But had common law paid out participants in the earlier years?

2 hours ago, CKocher said:

Should form 5500EZ be filed if it currently covers only the owner. But had common law paid out participants in the earlier years?

Yes.  

To be clear, you file the form that is required for the reporting period.  For a calendar year plan, if the plan only covered the owner during 1/1/22-12/31/22 it is a one participant plan and you are required to file on an EZ.

You are quite sure.

Is it true Even the plan covered common law employees in the previous years and paid them lump sum?

Can you give me the reference, or supporting arguments?

I couldn’t get a clear answer from IRS.

Thank you for your response.

I am 100% sure.

You are reporting for the plan year, not the life of the plan.

If the distribution took place in a previous year, you are no longer covering that participant, and cannot report them on the current return. I would reference the instructions to the SF and EZ, they are quite clear.  A one participant plan is not eligible to file a 5500-SF, it must file on a 5500-EZ.  The DOL will likely reach out when you don't file the 5500-SF because they cant tell that you filed an EZ with the IRS.  When they reach out, you just tell them that the plan became a one participant plan and was no longer eligible to file an SF.  They will tell you to have a good day and that is the end of it.

I will proceed with 5500 EZ.

Thank you.