I am trying to figure out what information I need to file a Form 5500 for a severance pay plan and am a little confused. What schedules, if any, should be attached? I assume there is some place where I can input the dollars that were paid out of the program? I am just a little fuzzy and any help is greatly appreciated.


Thanks

You will only have schedules if the plan is funded. File the 5500, indicate it is funded from general assets of the sponsor.

Does a "severance benefit plan" need a plan document just like the typical 401(K) or Profit Sharing Plans?

How do you determine the participant count for the Form 5500 for a severance benefit plan? We don't know how many employees of the employer will be let go so you do you count all of the employer's employees at beginning of year to determine if an audit is required for the plan?

Thank You for your Help!

If it is a "plan" as that term has been defined by the courts in ERISA cases (see, for example, the S. Ct's Fort Halifax case), and that's a difficult question, you need a document and an SPD. For the participant count, you need to take your best shot in applying the definition of "participant" in the DOL regulations to the pertinent terms of the plan. If the plan (assuming it is an "ERISA" plan in the first place) provides that the award of severance is discretionary, typically it is reasonable to take the position that the number of participants at the beginning of the year are only those currently receiving severance at the beginning of the year or those who have been awarded severance but as of the beginning of the year payment has not yet commenced.