BACKGROUND:
Form 5500-EZ, Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan applies to one-participant or “owner-only” plans if the plan has assets of $250,000 or more at the end of the plan year. Plans subject to the Form 5500-ez filing requirement include solo 401k plans and defined benefit plans.
QUESTION:
Please let me know if the form 5500-ez is still needed as the total amount is now below $250,000. So is it needed since at one point in 2021 the value of my solo 401k plan was over $250,000?
ANSWER:
A Form 5500-EZ is not required to be filed if the balance of the solo 401k was under $250,000 during the plan year so as of 12/31. It does not matter if the solo 401k was over $250,000 during the year prior to 12/31.
Note: If the solo 401k was closed during the year, a final Form 5500-EZ is required to be filed regardless if the value of the solo 401k plan was under $250,000 at time of closing or during the year.
For Form 5500-ez FAQs click here.
