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I am a sole proprietor and opened a solo 401k with TD Ameritrade at end of 2018 and then funded it before the tax filing deadline in 2019.

I understand that Form 5500 (5500-EZ) needs to be filed annually in event account assets exceed $250,000 or if the account is terminated.

When I look at certain lines of 5500-EZ:

2b) Employer Identification Number (EIN) (Do not enter your Social Security Number.)

3b) Administrator’s EIN

TD Ameritrade accepted my solo-401k application with only my SSN given as ID.

This is confusing to me. Who should apply for these EINs and when.

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An EIN is normally needed in order to contribute to a Solo 401K. You should double check that your application with TD Ameritrade was for a Solo 401K and not some other investment vehicle. If TD Ameritrade created a Solo 401K for you without it, then you should get one right away and let them know what it is.

Getting an EIN is instant and free. Just go to the IRS page, apply, and write down the number they give you. Then contact TD Ameritrade and let them know your number--you should also use this number for your schedule C filing. That phone call might be a good time to find out why they did not ask for it up front, as other providers do.

Be sure to check back here with what they tell you, as I'm curious how this happened. My guess is that it isn't technically illegal to have an Solo 401K without an EIN unless you have to file a related form with the IRS, but it seems odd for your provider to put you in that potential position by not requiring an EIN up front. When you switch over to using the EIN, you might have to redo your plan documents, and there's a decent chance you are going to trip an IRS audit flag.

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  • Thanks for advice. I have since dug a little deeper and found in the instructions for form 5500-EZ - "Employers without an EIN must apply for one as soon as possible". This suggests to me that they are aware that some solo 401k accounts do sometimes get started without an EIN. In my case Schedule C filing has always been submitted in past using my SSN since spouse is not involved in my sole proprietorship business. I am not aware of any forms that TD Ameritrade would have officially filed when my 401K was first started. – Maverick Feb 13 '20 at 2:52
  • Also the advertising on TD Ameritrade web page has "Administering a Solo 401(k) plan - Once your Solo 401(k) plan exceeds $250,000 in assets at the end of the year, the IRS requires you file an annual Form 5500 EZ. Or if you ever terminate the plan, you must also file a Form 5500 EZ." This suggests that they are not taking any responsibility for this type of filing. – Maverick Feb 13 '20 at 3:12
  • TD Ameritrade Specialist indicated that in event I wanted them to use an EIN when reporting my contributions there is no way to go back and amend what was reported last year using my SSN. The only way to get any future contributions reported with EIN is to to apply for a new 401K according to TD Ameritrade. – Maverick Feb 13 '20 at 17:41
  • That's what I suspected. Very shocking policy on their part to allow you to start a 401k with only your SSN. I suppose you can roll your current (SSN) 401K into the new (EIN) one without too much trouble, though. – farnsy Feb 13 '20 at 18:56

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