Guides

Solo 401(k) owner-only eligibility for Form 5500-EZ

The common-law employee question that decides whether a simple one-participant packet is still the right lane.

By Yann LephayPublished 2026-04-20 · Last updated 2026-05-02

Summary

Form 5500-EZ is reserved for one-participant plans: owner-only, partner-only, or owner+spouse. A single common-law employee who works 1,000+ hours/year and is age 21+ generally must be eligible for the plan, ending the EZ lane and forcing a switch to Form 5500-SF or 5500. Example: a consultant who hires a part-time admin working 1,200 hours/year crosses the threshold and exits the Solo 5500 Desk scope.

Hard stop: non-owner common-law employee issues do not belong in this MVP.

SupportedOwner/spouse or partner/spouse planDomestic one-participant defined contribution cases only.
UnsupportedCommon-law employee plan issuesCoverage, controlled group, and affiliated service group questions need review.
OutputSelf-preparation packetNo TPA, ERISA, fiduciary, or plan-design advice.

The owner-only question comes first

Do not start with balances. Start with plan coverage. A Solo 401(k) filing packet is only safe for this product when the plan is in the one-participant lane and the business does not need employee coverage analysis.

Why employees change the risk

Employees can create plan coverage, testing, notice, eligibility, and administration questions. Those questions are not resolved by preparing a Form 5500-EZ packet. They belong with a qualified plan professional or official instructions.

How Solo 5500 Desk handles the boundary

The wizard asks hard-stop questions before collecting form numbers. If the user indicates non-owner employee issues, late filings, amendments, IRS correspondence, or complex plan facts, the product should stop rather than produce a misleading packet.

Common questions

Can I use the app if I hired employees during the year?

Not without a careful scope check. The MVP hard-stops common-law employee and coverage issues because they can move the plan out of the simple one-participant lane.

What about my spouse?

Owner/spouse and partner/spouse one-participant scenarios are part of the intended lane when the other facts are simple and domestic.

Does the app advise on controlled groups?

No. Controlled group, affiliated service group, leased employee, and coverage-combined plan issues are outside scope.

Related guides

Solo 401(k) $250,000 threshold for Form 5500-EZ

How the IRS $250,000 one-participant plan asset threshold works for Solo 401(k) Form 5500-EZ filing.

Which Solo 401(k) assets go on Form 5500-EZ?

How to organize beginning and ending plan assets before preparing an annual one-participant return.

Form 5500-EZ line-by-line map for a Solo 401(k)

A source-linked field map for owner-only Solo 401(k) sponsors preparing a simple 2025 Form 5500-EZ packet.

Official sources

IRS Form 5500-EZ filing noticesIRS states the $250,000 asset exception and the last-day-of-the-7th-month deadline. Official source reviewed for this MVP on June 11, 2026.IRS Instructions for Form 5500-EZOfficial instructions explain combined one-participant plan assets, final returns, and electronic filing requirements. Official source reviewed for this MVP on June 11, 2026.IRS one-participant plan project resultsIRS describes common one-participant plan filing mistakes, final-year filings, and failure-to-file penalties. Official source reviewed for this MVP on June 11, 2026.IRS mandatory electronic filing for Forms 8955-SSA and 5500-EZOfficial IRS guidance on the 10-return mandatory e-filing threshold and aggregation rules. Official source reviewed for this MVP on June 11, 2026.DOL EFAST2 filer helpOfficial DOL guidance on electronic filing, IFILE, credentials, and approved software requirements. Official source reviewed for this MVP on June 11, 2026.IRS Form 5558 extensionOfficial extension form context for Form 5500-series returns. Official source reviewed for this MVP on June 11, 2026.IRS Form 14704 late-filer transmittalOfficial transmittal schedule for the Form 5500-EZ Delinquent Filer Penalty Relief Program. Official source reviewed for this MVP on June 11, 2026.IRS Revenue Procedure 2015-32Official revenue procedure establishing the Form 5500-EZ late-filer penalty relief fee framework. Official source reviewed for this MVP on June 11, 2026.

Last reviewed: June 10, 2026.