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Participant Statements.


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What is the recent requirement for participants to receive a statement of their account? Who is to provide these (outside the plan sponsor) and how often? For example, if a plan has pooled accounts and the TPA only provides annual statements are they required to provide statements at least quarterly?

Thank you

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Guest Sieve

A "pension benefit statement"--an ERISA term of art--must be provided for a defined contributin plan at least once a quarter by the Administrator (usually the employer, but the TPA generally provides it). (ERISA Section 105(a).)

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The frequency of the statements for DC plans is determined by whether the participants are able to direct investments. Participant directed plans must provide at least quarterly statements, non-self directed plans must provide at least annual statements.

From PPA Section 508(a)

‘‘(1) REQUIREMENTS.—

‘‘(A) INDIVIDUAL ACCOUNT PLAN.—The administrator of an individual account plan

(other than a one-participant retirement plan described in section 101(i)(8)(B)) shall furnish

a pension benefit statement—

‘‘(i) at least once each calendar quarter to a participant or beneficiary who has the right to direct the investment of assets in his or her account under the plan,

‘‘(ii) at least once each calendar year to a participant or beneficiary who has his or her own account under the plan but does not have the right to direct the investment of assets in that account, and

‘‘(iii) upon written request to a plan beneficiary not described in clause (i) or (ii).

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Guest Sieve

Kevin is correct that if a DC plan has no participant directed accounts, then statements are only required annually for the pooled accounts. If there are some pooled accounts and some participant directed accounts, then quarterly statements are required for the individually directed accounts. My experience is that such mixed plans provide quarterly statements.

Query: If loans from a pooled account are considered under the plan as individually-directed investements, does that now mandate quarterly statements for all accounts?

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If the the plan is participant directed and the financial institution that handles the plan assets provides at least quarterly statements to the participants or they have daily access via the internet, would this not satisfy ERISA Sec 105(a)?

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Guest Sieve

Statement must be just that, a statement. Internet access to it may or may not be sufficient under DOL regs. But, the statement must contain the required information indicated in ERISA Section 105.

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