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AdBits Episode 2 – IRS Form 5500

AdBits Podcast

IRA Financial’s Adam Bergman discusses the IRS Form 5500, which must be submitted before July 31, for individuals with a Solo 401(k) plan balance of at least $250,000 as of December 31 of last year.




In This Podcast

If you have a Solo 401(k) plan and have at least $250,000 in assets as of December 31 of the previous year, you must file IRS Form 5500. Don’t fret, as it’s just an informational form that details the assets held within your plan. It’s quite simple to fill out and if you are an IRA Financial client, we can help you through it. The deadline to fill out this form is July 31. Failure to file this form in a timely mater will lead to hefty fines.

What is the purpose of Form 5500? As we mentioned, it accounts for all investments you are holding with your 401(k) funds. Essentially, the IRS is just ensuring you are following the rules of the plan and that you aren’t trying to hide anything nefarious. The accurate Fair Market Value of your assets must be reflected on the form.

If you do not file this form on time, you can be penalized up to $250 per day, up to $150,000! The SECURE Act increased the penalties in an effort to emphasize the filing of the form. Therefore, if you are required to file a 5500, it is imperative you file it in a timely matter each year.

Stay in Touch

We always appreciate our listeners and we hope you will continue to listen and spread the word. You can find AdBits on SoundCloud, YouTube or your favorite streaming platform. Thanks for listening and if you have any topics you want to see covered, give us a call @ 800.472.0646 today!

Join us next episode as Mr. Bergman delves deeper into the IRS Form 5500, specifically the penalties for not filing and what you can do if you missed the deadline.

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