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. What Will We Cover Today?. Which plans need to file Form 5500?What schedules are included with the filing?How have the schedules changed from last year?Which plans can file new Form 5500-SF?What is the new electronic filing process?. . Which Plans Need to File Form 5500?. Pension benefit plans covered by ERISA:401(k), profit sharing, defined benefit, money purchase, stock bonus, and ESOPs403(b) plan subject to ERISA requirementsSIMPLE 401(k) plans.
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1. Form 5500…Changes Are Fast Approaching. Be Prepared. Presented by
Patricia A. Stahm, QKA
CBIZ Actuarial & Benefit Consultants
3. Which Plans Need to File Form 5500? Pension benefit plans covered by ERISA:
401(k), profit sharing, defined benefit, money purchase, stock bonus, and ESOPs
403(b) plan subject to ERISA requirements
SIMPLE 401(k) plans
4. Which Plans Need to File Form 5500? Welfare benefit plans covered by ERISA:
Plans with more than 100 covered employees, regardless of how benefits are paid
Plans that pay benefits from a trust, regardless of how many employees are covered
5. Which Plans Do Not Need to File Form 5500? Pension benefit plans such as:
Unfunded excess benefit plans
403(b) plans not covered by ERISA
SIMPLE IRAs
Non-electing church plans
IRAs
Governmental plans
6. Which Plans Do Not Need to File Form 5500? Welfare benefit plans:
Covering less than 100 employees that are:
Unfunded (benefits are paid from employer assets)
Fully insured (benefits are paid through insurance contracts or policies with premiums paid by either employer, employees or combination)
Combination of unfunded and fully insured
7. Delinquent Filer Voluntary Compliance Program If the Department of Labor finds you first:
Department of Labor penalties - $30,000 per year
Internal Revenue Service penalties - $25,000 per year
8. Delinquent Filer Voluntary Compliance Program If you voluntarily file first:
$750 per year for small plan (capped at $1,500)
$2,000 per year for large plan (capped at $4,000)
9. Delinquent Filer Voluntary Compliance Program How do you file?
File full 5500 filing electronically
Send copy of 5500 to Charlotte, NC with penalty payment or make payment electronically on DOL website
10. What Schedules Are Included With the Filing? Determined by plan category
Small plan – less than 100 participants on the first day of the plan year
Large plan – 100 or more participants on the first day of the plan year
80-120 rule
11. “All” Plan Schedules Form 5500 – the “transmittal letter”
Schedule A – plans with insurance
Schedule SB/MB – defined benefit plans
Schedule D – plans participating in DFE-type investments (DFE stands for Direct Filing Entity)
12. “All” Plan Schedules Schedule R – plans with required funding and/or distribution activity and/or adoption of amendments affecting defined benefit pension values and/or ESOP
Schedule SSA – reports participants with deferred vested benefits to the Social Security Administration
13. Small Plan Schedules Schedule I – limited reporting of financial information and plan activity
Attachment for schedule of delinquent contributions
14. Large Plan Schedules Schedule C – used to report fees paid to service providers and termination of accountant and/or actuary
15. Large Plan Schedules Schedule H – detailed reporting of financial information and plan activity
Attachment for delinquent contributions
Attachment for assets held for investment purposes
Attachment for assets held and disposed of within year
Attachment for reportable transactions
Accountant’s Report – results of independent audit of plan activity
16. How Have the Schedules Changed? Schedule C – significant expansion of disclosure of fees focusing on indirect compensation received by service providers
Schedule E – eliminated entirely; limited questions moved to Schedule R
17. How Have the Schedules Changed? Schedule I – new requirements for reporting late deposit of contributions and blackout periods; new categories for fees paid by plan
Schedule H – same additions as listed for Schedule I; mutual fund dividend income now reported separately
18. How Have the Schedules Changed? Schedule R – addition of ESOP questions; addition of questions for multiemployer defined benefit plans
Schedule SSA - no longer filed with the 5500; awaiting new Form 8955-SSA to file directly with IRS
Not yet available so may have to file an extension just for Form 8955-SSA
19. Changes for 403(b) Plans If subject to ERISA, only limited reporting was previously required
Effective with plan years beginning in 2009, full reporting is required, same as all other retirement plans
Includes audit requirement for large 403(b) plans
20. What’s the New Form 5500-SF? To be eligible:
Less than 100 participants on first day of plan year
Exempt from audit requirement (without enhanced bond)
100% “eligible plan assets”
No employer securities
Not a multiemployer plan
21. What Are “Eligible Plan Assets”? 100% invested in certain secure, east to value assets such as:
Mutual funds
Investment contracts with insurance companies and banks valued at least annually
Publicly traded securities held by a registered broker dealer
Cash and cash equivalents
Plan loans to participants
22. What’s the Electronic Filing Process? ERISA Filing Acceptance System aka EFAST2
DOL website
Third party vendor software used to generate 5500 and schedules (Relius, Datair, ACS, etc.)
Electronically signed 5500 submitted by software to EFAST2 for processing
23. What’s the Electronic Filing Process? Required for plan years beginning in 2009
Also required for prior years’ returns that are being amended or filed under Delinquent Filer Voluntary Compliance Program
24. What’s the Electronic Filing Process? Steps for registering
Obtain PIN and user ID from DOL website (www.dol.gov/ebsa)
Must have accessible e-mail address to complete process
25. What’s the Electronic Filing Process? Possible user types
Filing author
Filing signer
Schedule author
Transmitter
26. What’s the Electronic Filing Process? Notes regarding PIN
PIN is not to be shared with anyone else (such as a TPA or recordkeeper)
Same PIN can be used to sign multiple returns, including those of different companies
Keep PIN in safe place – if lost, can only be replaced by calling the DOL
27. What’s the Electronic Filing Process? Schedules/attachments submitted to DOL in pdf format:
Schedule SB/MB (includes actuaries wet signature)
Attachments to Schedules SB/MB
Audit report (includes wet signature and letterhead)
Attachments to Schedule I or Schedule H
28. What’s the Electronic Filing Process? When the filing is ready
Typically notified by e-mail that 5500 is ready to be signed
Signer enters PIN, user ID and name
Filing is submitted to DOL for processing either by signer or by vendor
29. What’s the Electronic Filing Process? Filing status messages – the bad ones:
Unprocessable submission – can’t open files
Processable submission – opened but not determined if acceptable
Processing – reading and determining if acceptable
Filing unprocessable – could not be read
30. What’s the Electronic Filing Process? Filing status messages – the good ones:
Filing stopped – read but critical information is missing (further action required)
Filing error – found critical errors (further action required)
Filing received – no errors
These filings are received and can only be changed by amending the filing!!
31. What’s the Electronic Filing Process? Plan sponsor must still keep a signed paper copy of the filing with the plan records
Summary Annual Report must still be distributed to participants
32. What’s the Electronic Filing Process? When to file
First deadline is 7 months after year end
May be extended:
File Form 5558 prior to 7 month deadline – gain 2 ˝ additional months to file
Use sponsor’s tax return extension – gain 1 month to 2 ˝ months depending on entity type
33. What’s the Electronic Filing Process? Form 5558 still filed via paper copy; not included with Form 5500 filing
Deadline is midnight in the time zone of the plan administrator (based on address on Form 5500)
If problems, print error messages, include as an attachment and re-submit filing
May be treated by DOL as timely based on facts and circumstances
34. What’s the Electronic Filing Process? Some exceptions to filing deadline:
If deadline falls on Saturday, Sunday or federal holiday, filing may be submitted on next business day
DOL provides additional extensions based on extenuating circumstances such as natural disasters
35. What’s the Electronic Filing Process? Filings will be available for public display within 1 day (DOL expectation!)
Amended filings previously only required the schedule or attachment being amended
Now must submit entire filing so that public display is complete
36. Questions? Pattie Stahm
CBIZ Actuarial & Benefit Consultants
(602) 277-2371 ext. 6632
pstahm@cbiz.com
Oscar Diaz
CBIZ Benefits and Insurance Services
(520) 321-7511
odiaz@cbiz.com