Plan administrative expenses billed to firm and taken as a business deduction
GM,
I have suggested to a client that instead of paying plan expenses out of the participant’s accounts, his firm should be directly billed for all plan expenses and taken as a business tax deduction.
The client and his partner have over 70% of the assets in the plan.
Does anyone have documentation that this is acceptable?
BTW, they are lawyers..
Permalink Submitted by Alan - IRA critic on Wed, 2021-09-22 16:03
There is more red tape and exposure the way expenses are being paid now than if the firm paid them. However, the plan may need to be amended to eliminate participant account billing before changing billing to the firm. The following link explains in considerable detail.
1260_Paying_Employee_Benefit_Plan_Expenses.pdf (groom.com)