If You Forgot to File This 401(k) Form, Here’s How to Avoid Massive Penalties

By Steffan Weiner, Guest Writer

This post is intended as an addendum to Dr. Jim Dahle’s 2018 post on How to Fill Out IRS Form 5500-EZ for those who have solo 401(k)s. As Jim stated:

“The good news is you don’t have to file this form at all if your individual 401(k) has less than $250,000 in it at the end of the year. If you’re only putting a few thousand into the plan each year, it may be decades before you have to do this form.”

Therein, lies the problem. We are supposed to remember to complete annual 5500-EZ filings that typically initiate at a date years in the future, and we don’t even know which year it will be. When I initiated my solo 401(k), I learned about having to fill out Form 5500-EZ and didn’t worry about it since it would be years before it became relevant. Eventually, that day came . . . and went.

Nearly two years after the deadline, I stumbled across an article about solo 401(k) screw-ups and was reminded. I determined the penalty for failing to file…

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This article was written by Lauren O’Brien and originally published on www.whitecoatinvestor.com