The DOL, IRS, and PBGC have introduced revisions to Kinds 5500 and 5500-SF that apply to reporting for plan years starting on or after January 1, 2023. The revisions are the third part of implementation of a September 2021 regulatory proposal that included modifications for the unique SECURE Act (see our Checkpoint article). Some modifications had been finalized for 2021 reporting (see our Checkpoint article) and others for 2022 reporting (see our Checkpoint article). The present modifications focus largely on retirement plans, with restricted influence on welfare plans. Different proposed modifications, notably the proposal to maneuver collaborating employer info reported for sure a number of employer welfare preparations (MEWAs) from Kind 5500 to Kind M-1, have been deferred for additional improvement as a part of a broader Kind 5500 enchancment challenge. Listed here are highlights for outlined contribution plans, together with 401(okay) plans:

• Mixed Reporting by DCGs. The plan administrator for an outlined contribution group (DCG) reporting entity can file a single aggregated Kind 5500 for the DCG, typically utilizing the principles relevant to massive outlined contribution plans. A brand new Schedule DCG (Particular person Plan Data) should be connected for every plan included within the DCG submitting. The ultimate guidelines mirror the proposed guidelines, besides that they remove the necessities that collaborating plans (1) use a single DCG belief, (2) get hold of an unbiased audit of that belief, and (3) make investments solely in specified belongings.

• Kind 5500-SF. This way can’t be used for DCG reporting preparations.

• MEPs. In keeping with the proposed guidelines, the ultimate guidelines add a brand new Schedule MEP (A number of-Employer Pension Plan Data) and a restricted variety of further information gadgets related to MEPs to the Kind 5500. Multiemployer plans and MEPs are prohibited from being a part of DCG mixed reporting preparations.

• Participant Counting. The ultimate guidelines mirror the proposed guidelines by increasing the provision of simplified Kind 5500 reporting by altering how outlined contribution plan contributors are counted. When figuring out whether or not a plan is a “small plan,” the willpower is predicated on the variety of contributors with account balances as of the start of the yr as a substitute of on the quantity eligible to take part.

• Inner Income Code Compliance Questions. The ultimate revisions embrace questions on whether or not a plan maintained by an employer that has aggregated plans in its testing group glad relevant nondiscrimination and protection exams, whether or not a 401(okay) plan sponsor used a design-based protected harbor method (or, if relevant, the ‘‘prior yr’’ or ‘‘present yr’’ ADP take a look at), and whether or not a plan makes use of a pre-approved doc.

• Schedule H Modifications. Schedule H has been up to date so as to add new breakout classes to the ‘‘Administrative Bills’’ class of the Revenue and Bills part of the stability sheet. Proposed revisions that might modernize the information parts reported a couple of plan’s investments on Schedule H and require that the schedules be filed electronically in a format that may be mined for information will likely be addressed as a part of the broader Kind 5500 enchancment challenge. [EBIA Comment: In addition to being filed by retirement plans, Schedule H is filed by large funded welfare plans.]

The DOL concurrently launched ultimate reporting rules that mirror the modifications to Kinds 5500 and 5500-SF and embrace conforming modifications to the necessities for the abstract annual report.

EBIA Remark: Though the DOL Reality Sheet characterizes this because the third and “ultimate” part of implementing the proposed modifications, the deferment of some proposals implies that much more modifications are coming. Will probably be attention-grabbing to see whether or not the broader enchancment challenge resurrects parts first proposed in 2016, together with important further reporting necessities for group well being plans (see our Checkpoint article). In the meantime, retirement plan directors ought to familiarize themselves with the modifications within the ultimate varieties and rules to make sure seamless reporting. The Reality Sheet signifies that mock-ups of the varieties and directions will likely be made out there on reginfo.gov, and the same old “for information-only” copies of the varieties and directions will likely be launched later in 2023. For extra info, see EBIA’s 401(okay) Plans guide at Part XXXI (“Plan Administration: Annual Kind 5500 Studies and SARs”), and EBIA’s ERISA Compliance guide at Sections XIX.F (“Kind 5500 Obligations for MEWAs and Collaborating Employers”) and XXII.L (“Schedule H (Giant Plan Monetary Data) & Accountant’s Opinion”).

Contributing Editors: EBIA Employees.