Common Solo 401k Form 5500-EZ FAQs

Mail the Form 5500-EZ to IRS QUESTION

Where do I file the Form 5500-EZ?

 

 

ANSWER:

Sign and date form  and mail it by July 31, 2019 to the following address.

Regular Mail: File the Form 5500-EZ at the following address:

Department of the Treasury

Internal Revenue Service

Ogden, UT 84201-0020

Private delivery services (PDSs).

Private delivery services (PDSs). You can use certain private delivery services designated by the IRS to meet the “timely mailing as timely filing/paying” rule for tax returns and payments. Go to IRS.gov/PDS for the current list of designated services. The private delivery service can tell you how to get written proof of the mailing date. Private delivery services use the following address:

Private delivery services should use the following address:

Internal Revenue Service

1973 North Rulon White Blvd.

Ogden, UT 84404

 

Amount and Due Date for Form 5500-EZ QUESTION:

What value must the solo 401k reach before I have to file and when must the Form 500-ez be filed with the IRS?

ANSWER:

If your solo 401k plan balance exceeded $250,000 as of December 31, 2018, a Form 5500-EZ is due to the IRS by July 31, 2019.

Determining $250K Value QUESTION:

How is the $250,000 Limit Determined?

ANSWER:

  • The total plan assets for all participants under the solo 401k plan must be added to determine if the cumulative balance is over $250,00.
  • IMPORTANT: If you participate in multiple solo 401k plans, all the plans assets must be aggregated to determine if the $250,000 threshold has been met.
  • If you borrowed from the solo 401k plan (i.e., took a solo 401k participant loan), the balance of the loan as of December 31, 2018 is treated as an asset not a liability so it must be included in the calculation to determine if the $250K threshold filing requirement has been met.

Cash and Real Estate QUESTION:

My Solo 401k is invested in real estate as well as cash in a bank account.  Do I just list the cash in the bank?
 

ANSWER:

If your Solo 401k plan includes cash and/or traditional investments (stock, mutual funds, money market, etc.) in a bank/brokerage account & alternative investments (e.g. real estate, notes, etc.), you will need to consider the total value of all plan assets as of December 31, 2018.  
 

Solo 401k Participant Loan QUESTION:

Are the solo 401k loans to myself a plan liability?  Seems duplicative because I have to report them in Part V.

ANSWER:

No, solo 401k participant loans are not considered a solo 401k plan liability  so do not get reported in 6b1 or 6b2 of Part III; Financial Information.

Value of Real Estate and Alternative Investments QUESTION:

How do I determine the value for real estate or other alternative investments?

ANSWER:

For alternative investments, you need to make a reasonable determination of the value of the solo 401(k)’s ownership interest in the investment as of December 31, 2018:
    • For real estate, you could work with your real estate agent to consider comps in the area;
    • For an interest in a partnership, this will not be the amount listed on the K-1 but rather the value of such partnership interest.

Multiple Participants and Account Types QUESTION:

My wife and I each have a Solo 401k account (under the same plan). Do we include the total value of both accounts? I also have pre-tax and Roth funds.  Do I include the total value of all three accounts?

ANSWER:

If there are multiple sub-accounts (e.g. pre-tax, Roth, etc.) and/or multiple participant accounts (e.g. accounts for spouses, partners), you will need to consider the total value of all sub-accounts.  

Part III. 6a through 6c QUESTION:

Part III, 6a.  I assume we list total assets of both my account as well as my wife’s?  No need to separate them?

ANSWER:

Correct that you need to list the total figures for the entire solo 401k plan as a whole not just for each participant. Reason being, both spouse are participating in the same Solo 401(k) plan, and Form 5500-EZ captures the information for the entire plan not just each participant.

Information for Plan Administrator QUESTION:

Why is your information not included on the Form 5500-EZ for the Plan Administrator?

ANSWER:

We don’t have access to your funds or  have signing authority over your solo 401k account; therefore, you (not us) are the solo 401k plan administrator.
We are the solo 401k plan document provider and provide the compliance support.

Line 7c Rollover of Deceased Spouse’s Pension QUESTION:

Quick question regarding Form 5500-EZ.  In Part III, Section 7c.  My husband passed away last year and I received his pension distribution from his pension plan and deposited the funds into my solo 401k plan. Do I report that deposit in 7c?

 

ANSWER:

Yes since you are the surviving spouse that would be deemed a direct-rollover and reported on line 7c of Form 5500-EZ provided the pension firm reported it as as direct-rollover. You can confirm by checking with them or if you received a 1099-R with a code “G” in box 7.

Foreign Solo 401k Investments QUESTION:

Are there additional filing requirements for a solo 401K account when assets are owned outside of the USA?

ANSWER:

Foreign investments do not trigger the Form 5500-EZ filing requirement unless when the value of the foreign investment(s) is included in the total value of the solo 401k plan causes the plan to exceed $250,000 in total value.

Reason being, a foreign plan is solo 401k plan maintained outside the U.S. primarily for nonresident aliens. A foreign solo 401k plan is required to file an annual For 5500-EZ return if the employer is a domestic employer or a foreign employer that has income from sources in the U.S. and that deducts plan contributions on its U.S. tax return.

Reporting Contributions in 6a Part III QUESTION:

I am getting ready to mail in my 2018 Form 5500-ez which is due by July 31, 2019 to the IRS. I made “voluntary after-tax” contributions for the year “2018” on “3-28-19” for each participant. $8,500 for one participant and $17,500 for the other. Do I include these amounts in the total plan assets amount in Part 6a?

ANSWER:

Since the contributions were made after the 12/31/2018 it does not get reported in 6a because that section is reserved for reporting the value of the solo 401k plan as of the beginning of the year and the end of the year.

Aggregate Plans QUESTION:

My Solo 401(k) is below $250K.  However, I have another 401(k) from former employer that may someday push me above $250K if I were to add the balances of the Solo and former employer together.  Does the aggregate 401(k) holdings trigger the Form 5500-EZ filing requirement?

ANSWER:

Good question. Only if the former employer 401k plan were transferred to the solo 401k plan and if it caused the value of the solo 401k plan to exceed $250,000 would an annul Form 5500-EZ be required. Reason being, the former employer 401k plan is not sponsored by your self-employed business but rather a W-2 employer that you used to work for.

Contributions Deposited in 2019 for 2018 QUESTION:

Do we count 401k contributions deposited in 2019 for plan year 2018 as part of the 2018 assets?  As of 12/31/2018, I did not have over $250K. However, I did make a 2018 contribution in March of 2019 that now put me over the $250k threshold.

ANSWER:

Correct that a Form 5500-EZ will need to be filed by July 31, 2019 if solo contributions made in 2019 for 2018 will result in the value of the solo 401k value going over $250,000.

Reporting Voluntary After-Tax Contributions QUESTION:

I made “after-tax” contributions. Do I record those as employee contributions?

ANSWER:

Yes as voluntary after-tax contributions are always deemed employee/salary deferral contributions.

Locate Prior Form 5500-EZ QUESTION:

How do I get a copy of my previously filed Form 5500-EZ?

ANSWER:

You can obtain a copy of previously filed Form 5500-EZs by filling out Form 4506, or by calling the IRS at 1-800-908-9946.

Multiple Solo 401k Plans QUESTION:

I just wanted to confirm that I will not have to file a Form 5500-EZ for either of my 2 (two) solo 401k accounts since they each have a balance of under $250,000.

ANSWER:

No that is not correct. Both solo 401k balances have to be aggregated to determine if the total value exceeded the $250,000 threshold. If the combined value exceeded $250,000, then the Form 5500-EZ filing requirement applies.

See the following (page 2) from the Form 5500-EZ instructions.

https://www.irs.gov/pub/irs-pdf/i5500ez.pdf

SOLO 401(K)

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