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Employee Benefit Form 5500

Form 5500: 

What is a form 5500 annual report of employee benefit plan?

Are you, as an employer, required to file a form 5500?

What is a small employer plan? 

What is an unfunded plan?

How do I file a form 5500? 

How many 5500's do I have to file? 

What are the deadlines to file a form 5500? 

If I missed the deadline to file a form and 5500, are there any extensions available?

Here are a few things that I'm going to go over in this video that can hopefully help your business make an educated decision on this critical document required by many employers to be filed annually. There are some things I don't have time to go over in this video, so if you're an employer with additional questions, please reach out to us. 

Hey, my name is Steven. I'm a registered employee benefits consultant and the president of Songer Benefits; we are an independent agency that partners with companies to assist them with their employee benefits. I have worked as a broker/consultant within employee benefits for over ten years. I help companies select their employee benefit health plans and design and service them throughout the plane year. I also help with ACA legislation and the Department of Labor compliance regulations. 

Before going into what form 5500 is, I'm going to go over the penalties for not complying with the form 5500 or the 5500 short form. 

The Department of Labor and the IRS can assess penalties for non-compliance with the annual reporting requirements, including submitting incomplete forms 5500 or 5500 short form or not filing the forms by the due date. The Department of Labor has the authority under the employee retirement income Securities Act to assess penalties of up to $2233 per day for each day in the administrator fails or refuses to file a complete form 5500 or short form. It's important to note the penalties may be waived if the non-compliance was due to reasonable cause. The IRS can also impose civil penalties for non-compliance with specific 5500 or 5500 short-form reporting obligations. 

There is a  delinquent filer voluntary compliance program. The Department of Labor created these programs to encourage employee benefit plan administrators to file overdoing reports and pay reduced civil penalties voluntarily. Planned administrators can use the program only if they make the required filings before being notified in writing by the Department of Labor of a failure to file a timely annual report. The Rs has also agreed to provide penalty relief where the program's conditions have been satisfied. Late filers of the form qualify for penalty relief from the IRS if they complete the required steps the IRS has provided. Alright

Each year, employee benefit plan administrators are generally required to file a report regarding the plan's financial condition, investments, and operations.

The annual reporting obligation is generally satisfied by filing the form 5500 annual report of an employee benefit plan or form 5500 short-form annual report Of small employee benefit plan plus any required schedules and attachments.

The Department of Labor, Internal Revenue Service, and the pension benefit Guaranty Corporation jointly developed the form 5500 series to consolidate employee benefit plans' main annual reporting requirement.

The form 5500 series is intended to protect the rights and benefits of playing participants and beneficiaries by sharing the employee benefit plans were operated and managed under specific prescribed standards. Employee benefit plan participants and beneficiaries are provided with or have access to sufficient plan information.

So, am I required to follow form 5500 or a 5500 short form for my employee benefits plan?

Administrators of ERISA employee benefit plans must file an annual form 5500 or 5500 short form unless a reporting exemption applies. More specifically, if you are the administrator of a profit-sharing plan, stock bonus plan, money purchase plan, 401K plan, defined benefit plan, 403B plan, or welfare benefit plan, you must file a Form 5500 or a 5500 short form for the plan each year.

However, specific welfare benefit plans are exempt from all or part of form 5500.

There is an exemption from reporting for small welfare benefit plans with fewer than 100 participants at the beginning of the plan year. Also, if the plan is unfunded, fully insured, or a combination of unfunded and fully insured.

Again For more information on which welfare plans must follow form 5500 or maybe exempt, please reach out to us; we have charts that can show which area you may fall into.

One example is an unfunded plan, where benefits are paid solely from the general employer assets and not from the plane assets in whole or in part—participant contributions or plant assets under Department of Labor regulations. Also, a plan that uses a trust or separately maintained fund to hold plant assets is not unfounded.

Insured plans are those where benefits are paid solely through insurance policies. Premiums must be paid directly by the employer from its general assets. Premiums may be paid partly from an employer's general assets and partly by participant contributions that the employer forwards three months after receipt.

For employers with under 100 employees and are still required to file Form 5500, you may be eligible to file the short form. Eligible small employer benefit plans may use the short form instead of the standard form. The short form is the simplified annual reporting form. To be eligible to file a short form, an employee benefit plan must have fewer than 100 participants, meet conditions for exemption from the plan audit requirement, have all of its assets invested in certain secure investments with a readily fair value. Hold no employer securities, not be a multiple employer plan, not be required to file a form M1. 

I don't have time to go over how to fill the Form 5500 or the short form in this video, but it can be done electronically. 

One question many people have is how many forms they need to file. For benefits provided by a single business entity, the number of annual reports to file depends on how many separate or risky plans the plan sponsor maintained. A plan sponsor can determine how many separate ERISA Plans it maintains by reviewing its employee benefit plan documents.

The deadline to follow form 5500 and the short form must generally be filed by the last day of the 7th month following the year's end unless an extension applies. The deadline usually is July 31st of the following year for calendar year plans.

A plan administrator may request a one-time extension of two and 1/2 months about filing IRS form 5558 by the UN extended due date of the Form 5500 or the short form. If form 5558 is filed on or before the expected due date of Form 5500 or the short form, the extension is automatically granted.

I hope this video has been helpful and provided you with some information on form 5500 if you need help deciding if you're required to file a 5500 or a short form, what your employee benefits plan number is, how to fill the Form 5500, who can you contact within the Department of Labor about the form 5500, how to deal with penalties you may receive or anything else regarding the form 5500 I'm always happy to see if I can solve these problems for people so please reach out to me anytime.