How complicated is reporting to the IRS?

If you have over $250,000 in assets, there’s a form (5500) that has to be filled out. And if you don’t, you might still want to fill it out. It’s not complicated. You’re basically saying, “Here’s the assets, here’s the value,” and there you go. It’s really not that big of a deal and an accountant can take care of it for you easily


What’s are the ongoing responsibilities and costs involved in QRP Administration?

Once you’re set up you’ll generally have little or no ongoing expenses.  You are required to file a form 5500 with the IRS if you plan has $250,000 in assets or more. If you have less then $250,000 and less then 100 employees you’re exempt from filing this form. You can file the form yourself online or you can have an advisor file the form.

Any asset like real estate or precious metals requires a statement of value or appraisal at least once a year to be used for compliance with plan asset value reporting.


    Is the QRP set up with me being the administrator, or can someone else be the administrator? What are the duties of an administrator?

    You can be the administrator or hire a 3rd party to be the administrator.

    Duties include:

    • Make contributions in accordance to the plan.
    • Keep the plan up to date and in compliance with all retirement plan laws.
    • Invest plan assets in accordance to the plan.
    • Provide information and required disclosures to plan participants.
    • Distribute benefits in accordance with the plan.
    • Inform eligible employees about the plan.

    Under law how long must plan administer or plan provider keep 401(k)-related records?

    The requirement is that records must be retained for 6 years. Records used to compile information that is required to be reported under the reporting and disclosure rules must be preserved by plan administrators (and by actuaries, accountants and others who may be involved) for 6 years after the due date for filing the documents to which they relate (ERISA Sec. 107). These records must have sufficient detail to permit the necessary basic information and data to be verified, explained or clarified for accuracy and are to include vouchers, worksheets, receipts, and applicable resolutions.

    Accidental destruction of records will not discharge the persons required to retain records from their statutory duty with regard to the purposes for which such records are required to be retained. Where persons required to retain records know or should know that such reconstruction is impossible, or possible only at an excessive or unreasonable cost, such persons would not be under a duty to reconstruct or attempt to reconstruct the lost or destroyed records.


    Do I have to file anything with the IRS?

    YES, after your QRP is setup you will need to file Form 5500 once a year if your plan assets are over $250,000, otherwise you are exempt from mandatory filing.


    For the 2017 year if my company is a Sole Proprietorship, LLC or Corporation how much time do I have to make contributions to my plan and take a tax deduction?

    You have until you file your corporate tax return in 2018, including any extensions


    What is a 990T?

    It’s the form to report Unrelated Business Income Tax. If your QRP had active income that was taxed you would likely use this form