I figure someone here has dealt with this before... I got a letter from Vanguard last week telling me I need to do a restatement of my individual 401(k). At first I didn't understand it, but after some internet investigating I see that it's and IRS requirement to make sure that the plan complies with any laws passed in the past few years. Ok, fine.
My question, though, is that when I started this 401(k), I was registered with the state as an LLC. My husband and I moved this summer, and I'm winding this business down anyway, so when we moved, I filed to dissolve the LLC in our old state and now I'm set up as a sole proprietor in my new state while I finish out my one remaining contract.
When I called VG to ask about this, they basically said I need to consult a tax professional (which I'm willing to do if that's really necessary) and said that all they need is for me to fill out the paperwork just like I did the first time. But that would require me to say I'm an LLC, which is no longer true. Or, if I want to change it, I fill out a different form which appears to start a whole new 401(k).
Did I cause myself a big problem by dissolving the LLC in my old state before I was ready to close the 401(k)?
Options I can think of:
1 - Just go ahead and close the 401(k). Avoids the issue of restatement but precludes me from contributing the (admittedly small) income I expect to get from my last contract in 2015.
2 - Register in my new state as an LLC. Would this allow me to do a straight restatement, or is it still a problem since it's not the same state?
3 - Stay as a sole proprietor and convert my current 401(k) plan into a new one. This seems overly complicated, but the paperwork itself seems minimal.
I'd greatly appreciate any advice or clarification anyone's got to offer, and like I said, I'm not opposed to checking with a professional if that's warranted.
My question, though, is that when I started this 401(k), I was registered with the state as an LLC. My husband and I moved this summer, and I'm winding this business down anyway, so when we moved, I filed to dissolve the LLC in our old state and now I'm set up as a sole proprietor in my new state while I finish out my one remaining contract.
When I called VG to ask about this, they basically said I need to consult a tax professional (which I'm willing to do if that's really necessary) and said that all they need is for me to fill out the paperwork just like I did the first time. But that would require me to say I'm an LLC, which is no longer true. Or, if I want to change it, I fill out a different form which appears to start a whole new 401(k).
Did I cause myself a big problem by dissolving the LLC in my old state before I was ready to close the 401(k)?
Options I can think of:
1 - Just go ahead and close the 401(k). Avoids the issue of restatement but precludes me from contributing the (admittedly small) income I expect to get from my last contract in 2015.
2 - Register in my new state as an LLC. Would this allow me to do a straight restatement, or is it still a problem since it's not the same state?
3 - Stay as a sole proprietor and convert my current 401(k) plan into a new one. This seems overly complicated, but the paperwork itself seems minimal.
I'd greatly appreciate any advice or clarification anyone's got to offer, and like I said, I'm not opposed to checking with a professional if that's warranted.