Form 5500 For Dummies

[Spatty99]

Looking for the cliff notes and/or feedback on the process of filing a form 5500.  I have an individual 401k for my personal consulting business, where I am the one person employer/employee/participant, with 401k balance exceeding 250k as of 2016.  The IRS has the typical overly complex if/then/columns/go/to/cntrl+alt+del/etc instructions, but in my brief research and discussions it sounds like I can simply mail in 5500-EZ (or 5500-SF electronically) and be done with it...?

[spiritrider]

Mail in the Form 5500-EZ. Don't be taken in by the fact can file Form 5500-SF electronically. Just make sure you submit by 7/31. The penalties for late filing are significant.

[litovskyassetmanagement]

Spatty99 wrote:

Looking for the cliff notes and/or feedback on the process of filing a form 5500.  I have an individual 401k for my personal consulting business, where I am the one person employer/employee/participant, with 401k balance exceeding 250k as of 2016.  The IRS has the typical overly complex if/then/columns/go/to/cntrl+alt+del/etc instructions, but in my brief research and discussions it sounds like I can simply mail in 5500-EZ (or 5500-SF electronically) and be done with it…?

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I would not recommend filling out form 5500 yourself.  That's not to say that you can't do it, I'm sure some people are up to the task.  I would hire a TPA, and many would do it for $250 or possibly even less.  Too many chances to make mistakes that can result in an audit.

[jfoxcpacfp]

Spatty99 wrote:

Looking for the cliff notes and/or feedback on the process of filing a form 5500.  I have an individual 401k for my personal consulting business, where I am the one person employer/employee/participant, with 401k balance exceeding 250k as of 2016.  The IRS has the typical overly complex if/then/columns/go/to/cntrl+alt+del/etc instructions, but in my brief research and discussions it sounds like I can simply mail in 5500-EZ (or 5500-SF electronically) and be done with it…?

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5500EZ is quite simple. If you get stuck, email me and I'll help if I can.

[Spatty99]

Thanks all for the feedback, and Johanna for offering email assistance!

I ended up researching a lot on my own, and contacted the IRS for one clarification, but everything was pretty straightforward and simple.

For anyone else filling out the form...

Be aware that several references state to not include contributions on 7a(2). That is a bit misleading, as contributions made in the reporting year should be included (basically just use your year end balance statement).  The references actually mean to not report contributions that were made in the following tax year but intended for the reported tax year (since they had not occurred yet and don't yet show in the reporting year end balance), those will appear in 8b.

The plan characteristics I used for an individual 401k with me as the sole participant, saved in a an E-trade brokerage account are: 2E, 2J, 3B, 3D, 2R.

 

[The White Coat Investor]

You certainly don't need a pro to fill out 5500EZ for an individual 401(k). As I recall, Vanguard sent me everything I needed to fill it out.

Now if you have a real 401(k)...that's probably $250 well spent.

[cvcv]

Bumping for help filling out Form 5500-EZ.  I am filling out for myself and my husband.

Me:  1099 income, S-Corp with W2 income and profit sharing.  Has employEE and employER contributions.  These were made in Jan 2018, so don't these aren't reported on Form 5500?  Last year accountant filled it out and used "2E  2J  2R  3B  3D  1A".  Is this right?

Husband:  Received small 1099 income from my S-Corp to open solo 401k, and move IRA there (to do the backdoor Roth IRA).  He made a $100 contribution. (He has W2 income and 401k through job).  He is sole proprietor with an EIN, no S-Corp.  What are his plan characteristics?  My guess is "2E  2J  2R  3B  3D".  Does this sound right?

[jfoxcpacfp]

cvcv wrote:

Bumping for help filling out Form 5500-EZ.  I am filling out for myself and my husband.

Me:  1099 income, S-Corp with W2 income and profit sharing.  Has employEE and employER contributions.  These were made in Jan 2018, so don’t these aren’t reported on Form 5500?  Last year accountant filled it out and used “2E  2J  2R  3B  3D  1A”.  Is this right?

Husband:  Received small 1099 income from my S-Corp to open solo 401k, and move IRA there (to do the backdoor Roth IRA).  He made a $100 contribution. (He has W2 income and 401k through job).  He is sole proprietor with an EIN, no S-Corp.  What are his plan characteristics?  My guess is “2E  2J  2R  3B  3D”.  Does this sound right?

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You'll probably have better luck with a response if you'll upload the document since none of us has it memorized. Well, @spiritrider maybe  

[cvcv]

@jfoxcpacfp   How do I upload a document?  Here are links:

PDF document:  https://www.irs.gov/pub/irs-pdf/f5500ez.pdf
Instructions (page 8 has the codes):  https://www.irs.gov/pub/irs-pdf/i5500ez.pdf