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IRS Form 5558 and Problems with the IRS

  
  
  

Yesterday we discussed the Updated IRS Forms 5558 Procedures. Form 5500 Extension Request – An IRS Nightmare discusses some recent problems a TPA encountered with IRS Forms 5558 filings. Even though a signature is no longer required, the IRS sent a letter to some of their IRS Form 5558 filers that did not sign the form rejecting the extension. The article discusses the problems that the TPA firm encountered trying to resolve the problem and shares some best practices:

So, what should a practitioner do if presented with a similar situation? Do not ignore the rejection of your extension and assume the IRS will straighten out the mistake. You should immediately contact the IRS and inform them of their mistake.
Insist that the IRS contact the department handling penalty letters for late Form 5500 filings and cancel any such letters that may be forthcoming. Although you may inform the IRS by phone of the mistake, you should follow up the call with a letter. When speaking with the IRS, write down the date of the conversation, the name of the IRS agent and his/her badge number. The information will be helpful if the IRS does not resolve the issue promptly. If your firm experiences a pattern of rejections, you should insist on speaking with a supervisor.

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2012 IRS Pension Plan Limits

401(k) Deferral Limit - $17,000

Annual Additions Limit - $50,000

Maximum Compensation Limit - $250,000

Catch-Up Contribution Limit - $5,500

Highly Compensated Employee - $115,000

ESOP 5-Year Distribution Threshold - $1,015,000

ESOP Additional Year Threshold - $200,000

2012 Pension Plan Limits

1989 - 2012 Plan Limits