- There are few fans of the Form 5500. But that does not absolve most employee benefit plans with more than 100 participants from the obligation to file one. Data analytics firm miEdge and Wrangle LLC, which only works with Form 5500s, has prepared a list of points to keep in mind about the form.
1. Employers with a health and welfare benefit plan with 100 or more participants on the first day of the ERISA plan year must file a Form 5500 and related schedules. But plans with fewer than 100 participants generally do not have to unless the benefits are funded through a trust or a multiple employer welfare arrangement (MEWA). - 2. A Mega Wrap plan document — used to wrap the required ERISA language around a carrier’s certificate of coverage and combine or bundle many employer-sponsored benefits into a single plan — can simplify Form 5500 filing and result in only having to file a single form instead of multiple forms.
- 3. Employers have up to seven calendar months after their ERISA plan year renewal date to file the Form 5500; however, they can file a Form 5558 for a 2½-month extension.
- 4. If a professional employer organization (PEO) notes itself as a single employer, there is no information in the Form 5500 to state who constitutes the PEO. But if a PEO files as a multiple employer because it has a MEWA, they must attach a list of participating employers to the Forms 5500 that are filed.
- 5. If a U.S.-based company hires a foreign national working in the United States, that foreign national would be counted if he or she is enrolled in the benefits as a participant in an ERISA plan.
- 6. A Form 5500 still must be filed by a self-insured plan if the reporting threshold has been met.
- 7. Voluntary benefits may still be reportable even if the employee pays for the entire premium. If the plan sponsor endorses the benefit — through employer program recommendation, insurer selection, rates, terms or design, and information distribution — it may be covered by ERISA.
- 8. Employers that have delinquent welfare benefit Forms 5500 can enroll in the Department of Labor’s (DOL) Delinquent Filer Voluntary Compliance Program and thereby limit the penalties that will be imposed.
- 9. In fiscal year 2015, the DOL’s Employee Benefit Security Administration found ERISA violations by 67% of pension plans and ERISA health and welfare plans that were audited.
- 10. Effective Aug. 1, the DOL imposed a new penalty amount for a refusal to file a Form 5500 or a failure to do so.
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