What do I need to tell my accountant or CPA about this new plan?

Yes you do. While most accountants and CPAs understand qualified plans, they may not be that familiar with defined benefit plans.

This being the case, here are a few things your accountant will need to be aware of:

1) These plans are qualified plans and have an IRS approval letter. You should share the plan documents with your accountant.

2) You have the ability to make the contribution up to the date you file your taxes (including extensions) and take a tax deduction on your prior year tax return.

3) Your plan contributions can be reported in a couple places on your tax return depending on your entity structure.

We have completed a comprehensive post that will show your accountant how to reflect your contributions on your tax return. See it here: https://emparion.com/deduct-cash-balance-plan-contributions-tax-return/ 

If your accountant still has questions feel free to have him or her reach out to us. We are glad to help!