ANSWER: After reviewing the IRS Form 5500-EZ notice letter, we understand it to mainly serve to confirm the following:
- That the IRS has your plan in their records as having filed a Form 500-EZ.
- Reminder that you may need to continue filing a form 500-EZ.
In sum, this letter serves to confirm a bigger picture: 1) that it is important to file an annual Form 5500-EZ once the plan exceeds $250,000 in total assets, 2) that all one-participant plans (solo 401k plans) must be aggregated to determine that $250,000 threshold filing requirement, and 3) regardless of asset value, a final Form 5500-EZ must be filed in the final plan year to formally close the solo 401k with the IRS.
Frank in Texas