On May 23, 2022, the IRS, DOL and the PBGC released final regulations that make revisions to Forms 5500 and 5500-SF applicable to annual reports for retirement plans (including 401(k) plans) filed for plan years beginning on or after January 1, 2022.
The final regulations include many of the changes proposed by the agencies in September 2021 to reflect Code and ERISA amendments made by the Setting Every Community Up for Retirement Enhancement (SECURE) Act. For general information on the SECURE Act, see our article and similar resources on the dashboard.
The DOL has issued a plain language news release explaining the changes.
Background. On December 29, 2022, the agencies released informational copies of the 2021 Form 5500 series, including schedules and instructions, that included most of these SECURE Act changes (see our blog for details).
MEPs and PEPs Are Mainly Affected. Although many of the changes are of particular interest to defined benefit retirement plans, 401(k) plans that qualify as “multiple employer plans” (MEPS) or “pooled employer plans” (PEPs) are also affected.
Major Changes for 401(k) Plans. The major changes applicable to 401(k) plans include the following (not exhaustive):
- “Plan Sponsor” and “Plan Administrator”. Two new “bullets” have been added to the “plan sponsor” definition in the Form 5500 instructions, as follows:
- One indicates that the plan sponsor for a PEP is the pooled plan provider that operates the plan, and
- The other indicates that the PEP is the plan sponsor for a professional employer organization (PEO) plan.
- Form 5500-SF Filing. In the Form 5500 “Quick Reference Chart” which summarizes the filing requirements for various types of plans, a footnote states that certain small plans may be eligible to file Form 5500-SF instead of Form 5500. The list of plans permitted to file Form 5500-SF has been revised to add (i) plans that are not required to file Form M-1; and (ii) plans that are not PEPs.
- Caution! Form PR Filers. The instructions for Form 5500 warns PEP filers that they may receive correspondence from the DOL or IRS if the information on Form 5500 does not match the information on Form PR (Registration for Pooled Plan Provider), also filed with the DOL.
- Although the revisions to the Form 5500 Series mainly affect MEP 401(k) plan sponsors and administrators, as well as employers who participate in MEPs and service providers and advisors who work with them, there are other minor changes that may be of interest. If you are uncertain as to whether any of the changes affect your plan, please contact your TPA, accountant, or other entity responsible for filing your Form 5500 Series annual reports.
DISCLAIMER: This article is intended only as a brief overview, not a comprehensive analysis, of the latest agency guidance relating to the most recent changes made to the Form 5500 series annual reports for 401(k) plans. It is not intended to address the details of 401(k) reporting requirements generally, or Form 5500 requirements for 401(k) plans, which are further discussed in our article.
The information and content contained in this blog post are for general informational purposes only, and does not, and is not intended to, constitute legal advice. As always, for specific questions concerning your 401(k) retirement plan, or for help in operating your plan during the current COVID-19 crisis, please consult your own ERISA attorney or professional advisor.