Employee Benefit Plans: The 411

Valuable Information on 401ks, Pensions, ESOPs, Form 5500 Preparation + More

Form 5500: What you need to know

Form 5500, audit, employee benefit plansForm 5500 is an annual return/report that employee benefit plans are required to file with the Department of Labor’s (DOL) Employee Benefit Security Administration (EBSA) division. Employee benefit plans subject to Employee Retirement Income Security’s Act (ERISA) standards are required to file Form 5500 on an annual basis. This report serves to satisfy necessary disclosures, compliance and research needs of federal agencies, benefit plan participants and beneficiaries.

Filing requirements

A variety of schedules must be completed to file the form. These schedules contain information regarding assets and liabilities, insurance contracts, service providers, actuarial details and various financial transactions.

For benefit plans that have more than 100 participants, federal law requires an audit of the plan to be performed by an independent certified public accountant. There are certain exceptions to this general rule if the plan falls between 80 and 120 participants and filed a Form 5500 in the prior year. If your employee benefit plan is required to have an audit, you must include the audited financial statements with your Form 5500 when you file it.

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Due dates and extensions

The form and required schedules must be filed by the last day of the seventh month following the plan year end or July 31 for calendar-year plans. Extensions are permitted if Form 5558 is filed with the IRS prior to the normal due date of your Form 5500. This extends your due date for two and a half months, or October 15, for calendar-year plans.

How to file

The Internal Revenue Code and ERISA require employee benefit plans to file the form electronically using the DOL’s EFAST2 Filing System. As of January 1, 2010, it is mandatory that the return is filed by a plan electronically. For more information on EFAST2 and how to file Form 5500, click here.

Shelby Milburn