In our last newsletter, we noted that Congress was considering a law that would allow for Roth conversions inside of plans, not just from IRA to IRA. It’s becoming a reality, as the House and Senate recently passed the Small Business Jobs and Credit Act of 2010 including these provisions, and President Obama is expected to sign it any day.
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1) 2009 plan year tax return filings – update
You may recall that plan tax return filings (Form 5500 series) must be filed electronically, starting with the 2009 plan year – for calendar year plans, those are the returns that are due this July 31. As noted before, this will involve you, the plan sponsor, doing some on-line registration that will be, at best, a nuisance. Under current rules, you must do a lot of the work yourself; the Department of Labor shares the job of collecting plan information with the IRS and is obsessed with making sure that plan sponsors really and truly understand their filing responsibilities and so far, are unwilling to change their rules. We’re holding off on asking you to do anything yet because my pension group, the American Society of Pension Professionals and Actuaries (ASPPA), has made a last-ditch appeal to allow third parties such as ourselves to file for you, if you just sign a form (as is commonly done with personal tax returns). We can’t wait too much longer but are certainly hoping the DOL sees the light.
