How to Handle Forfeitures

As a plan sponsor, chances are that at some point throughout the course of business, the employee benefit plan that you manage has encountered plan forfeitures. Forfeitures typically result from the termination of service by an employee who was not fully vested in his or her employer contributions. The confusion related to forfeitures doesn’t revolve …

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What You Need to Know When Filing Form 5500

What is Form 5500? Form 5500 is the annual tax return for your retirement plan that must be filed with the Employee Benefit Security Administration (EBSA), a division of the Department of Labor (DOL). It is required by the Employee Retirement Income Security Act of 1974 (ERISA) to ensure employee benefit plans are operated and …

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Plan Corrections Necessary? DOL Corrections Program

If your company offers an employee benefit plan that is subject to the Employee Retirement Income Security Act (“ERISA”), for example a 401(k) plan, it is important to remember that your Company is responsible for ensuring that the Plan and any plan transactions comply with the fiduciary standards ERISA has created. Even though a Plan …

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Have Lost Participants in Your 401(k) Plan?

Lost participants are those participants who have balances in the plan (unclaimed benefits) or have been distributed an amount from the plan (uncashed benefit checks) and cannot be located. The participant either doesn’t know or forgot they have a balance since their employment was terminated or have relocated with no forwarding address. The participant’s account …

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ERISA Accounts – Plan Assets?

Employee benefit plans are seeing increased regulation and disclosure of plan fees including new disclosures of compensation paid to covered service providers in July 2012 (https://www.hhcpa.com/blogs/employee-benefits-audit-services/fee-disclosure-regulations-for-covered-service-providers/). The result of the new fee disclosures and oversight by plan fiduciaries is that record-keepers are expanding their offering of expense accounts, typically known as an ERISA Account, to …

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IRS Employee Plans Examination Process

In my previous blog, I discussed the oversight responsibilities of the IRS and Department of Labor over 401(k) plans, and what to expect if your plan is selected for an audit. One type of audit you may encounter is an IRS Employee Plan Examination, which is essentially designed to identify areas of noncompliance, develop corrective …

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All About Blackout Periods

We recently had some questions about how blackout periods work, and I learned a lot by consulting some of our TPA (third party administrator) colleagues and the DOL website. A blackout period is basically a time that participants temporarily lose control of their retirement accounts.  During this period, no changes can be made to investment …

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Department of Labor and IRS Audits of 401(k) Plans

Federal oversight of 401(k) plans is essentially divided between the Internal Revenue Service and the Department of Labor. The IRS oversees the qualified status of 401(k) plans and issues determination letters. The DOL oversees fiduciary standards, reporting and disclosure requirements, and all other rules that do not affect the qualified status of 401(k) plans. Audits …

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Remitting Contributions Timely

The Department of Labor regulations states that employee contributions should be remitted to the plan as of the earliest date on which such contributions can reasonably be segregated from the employer’s general assets, but no later than the 15th business day after the end of the month from the date on which such amounts are …

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