How to File a Form 5500-EZ Extension [Form + IRS Pitfalls]

Timely filing form 5500-EZ is critical. But what if you can make the due date? Is there a Form 5500-EZ extension?

Thankfully, there is. It is not that challenging to complete. But it must be filed before the due date to avoid a large late filing penalty.

In this guide, we will discuss what is involved in filing a form 5500-EZ extension. We will also give you a few tips and tricks along the way. Let’s get started!

How do I extend my form 5500-EZ?

The IRS Form 5558 is an Application for Extension of Time to File Certain Employee Returns. This form provides you with an extra 75 days to file your Annual Form 5500. After you submit your form, the Internal Revenue Service will send you an official receipt.

This will arrive by mail several weeks or months after you submitted your form. Make a copy of this document for your own records. Once you’ve completed the form and received it, you can begin work on filing your Annual Form 5500.

What is a 5558 extension?

Generally, you must file Form 5558 electronically with the DOL and in paper form with the IRS on or before the regular due date. If you are single and the plan year ends on the same day, you should file Form 5558 for each individual Form 5500.

You can request an automatic extension up to 90 days by filing Form 5558. The DOL may also extend the due date if a disaster occurs. Nevertheless, the DOL has the final say.

In order to avoid penalties, you must file your Form 5500 by the last day of the seventh month following the end of your plan’s year. For example, a plan that started on January 1 must report its previous year by July 31. For businesses, the IRS grants an automatic extension of two and a half months.

However, if you are not able to file your Form 5500 by the deadline, you can request an extension by completing Form 5558. If you are late filing, the IRS will assess a penalty of $25 per day up to $15,000, plus any interest on the accumulated tax.

Form 5500-ez extension

After you’ve received your IRS notice, you can choose to respond to the letter in person or by mail. Remember to attach your Form 5558 and the proof of timely filing. If your form has been sent by a third-party administrator, you can also submit your form electronically.

Your letter must explain the reasons why you missed the deadline and why you believe you had a reasonable excuse. You should always contact your TPA before sending it by mail.

The IRS does not offer online tracking for the Form 5558. Therefore, if you need to extend the due date of your Form 5500, make sure you keep copies of your postmarked envelope and completed Form 5558.

Remember, this is an application for extension of time to file certain employee plan returns. Missing a deadline is bad news for both you and your employees. To avoid penalties, you should file Form 5558 as early as possible.

In order to file Form 5558, you need to download the form from the Internal Revenue Service website. Then, you must open it with a PDF-element program.

Then, you need to fill in the relevant information in the three parts of the form. In Part I, the filer must provide their name, address, and social security number. Next, they must enter the name and number of the plan in which they participate and the year they participated.

Who files the extension?

When it comes to retirement plans, who files form 5500-EZ? It’s important to know that it’s not always the same person. One example would be a plan with only one participant.

Those plans are not required to file form 5500-SF electronically and instead use Form 5500-EZ to comply with the new tax laws. In addition to using the new tax forms, filing this form can save you time and money, since it’s all electronic.

As for what information needs to be updated on the form, a Solo 401k plan may have had less than $250,000 of assets at the end of last year. For example, a plan with less than $250,000 of assets may need to update the total plan liabilities, which includes benefit claims payable, operating payables, acquisition indebtedness, and future distributions to participants. To file form 5500-EZ, the Solo 401k plan administrator must change the Employer’s name, address, and phone number.

The Internal Revenue Service (IRS) provides instructions for filing form five-hundred-and-fifty-eight-EZ. There are some important tips to keep in mind when filling out the form. To make it as simple as possible, use an efficient filing tool.

It is important to follow these instructions carefully so that the IRS will accept your form. Ensure that you have all the required information on hand, including any attachments, before you start filing.

Firstly, the Employer and the Adopting Employer should update the information on the form. The employer tax codes are usually 2J and 2E. In question fivea-c, the Employer should update any participant information.

Form 5500-EZ basics

This includes loans and tangible personal property. These are the most commonly missed questions on the form. TPAs can assist you in completing them. If the Employer does not wish to do it, the Employee should complete the form.

The information on Form five-hundred-eight-EZ should be easy to fill out if you follow the steps in the instructions. However, some individuals find it helpful to get professional help to complete the form. Some accountants bundle Form 5500-EZ filing with their annual tax preparation. Self-directed solo 401k plans typically offer bundled services for this process.

Another common reason for seeking outside help is account valuations. If your account is comprised of only stocks and bonds, calculating the account value should not be difficult. However, if the account contains other assets such as bonds or commodities, you will need to hire a professional to evaluate your portfolio.

Filing Form 5500-EZ late is required by law. The deadline for filing Form 5500-EZ is the last day of the seventh month following the plan year. If the last day of July falls on a weekend, you can file the form on the next business day.

If you are unable to do so, you can extend the deadline by filing Form 5558 and a copy of the document with the IRS. Using the Form 5500-EZ late filing form does not qualify for the Delinquent Filer Voluntary Compliance Program (DFVCP) either.

How long can you extend a 5500?

The IRS and DOL require plans that offer retirement benefits to file Form 5500. Under ERISA, employers must meet certain standards for financial protection, reporting, accountability, and procedural safeguards. An employee benefit plan is a retirement plan for an employee or former employee.

A retirement plan may be defined as a pension, 401(k), profit-sharing plan, or other similar benefit program. If you’re unsure if you have a retirement plan, consult your retirement plan advisor and prepare a sample form to find out.

Only allowed for solo plansFewer than 100 participants
Can also include spouseAnnual filing requirement
Not required if assets less than $250kNon filing penalties of $2,233 per day

Final thoughts

Leave a Comment