IRS Plan Number Rules?

[BG5150]

Is there a codified rubric that says how IRS PNs must be assigned?

I have a MEP, do I have to have a PN that starts with a 3?

Where is the written guidance?

[Lou S.]

I could be wrong but my understanding is Pension Plans are supposed to start with 001 and Welfare Plans supposed to start with 501 and add 1 each time the employer adds a new plan.

But I don't know if that's a hard fast rule or if there is any written guidance. That is can you assign any 3 digit number that hasn't been used by the employer before? I don't know. I do know if you go off convention the chance of the IRS asking you why and where the plans with a lower number are seem to increase. But I honestly don't think I've ever seen IRS written guidance on the where there convention comes from and if it's required that you follow it.

Maybe someone else has something more on point.

 

[Bob the Swimmer]

5500-EZ---Page 5, instructions for line 1b is one place where it's discussed--I'm sure other IRS instructions have this content.

 

[BG5150]

I have more a concern for -SF and 5500's

Here's the situation:

Plan 001 sponsor plus several other members of controlled group/ASG.

On 1/1/21 several affiliated companies adopted the plan.  The affiliation does not rise to CG/ASG levels, making it a closed MEP.

They created a NEW plan for the MEP with IRS PN 333.  No one thought to term plan 001.  And at the carrier, nothing moved.  Same accounts, it's just some of hte other entities had their former plans merged in.

So the auditors, seeing a NEW plan, want to have the assets at zero.

But I don't think it should be a NEW plan, just a plan that went from single-ER to MEP and the PN should have remained at 001.

There is no mechanism on the 5500 to indicate a change of PN, just name, EIN.

My solution was to just correct the plan document and call it restated with plan 001.

That led to my question:  does a MEP have to have a PN of 3XX?  Could we have a MEP of 001?

Or, MUST you have a new plan when something like this arises?  I don't think so, because you can have to members of CG in one plan and the relationship ceases to be a CG.  You don't creat a brand new plan for that.  

Int hat case, do you change the PN to 300 or 333 or whatever?

 

[AKowalski]

The rule is stated on page 17 of the Form 5500 instructions. The EIN plus plan number together form a unique 12-digit number that the IRS uses to identify each plan, which does not ever change, even if a lower-numbered plan terminates. You start at 001 for retirement plans and 501 for welfare plans, skipping 888 and 999. If there are several new pension plans being adopted simultaneously, my impression is that you can assign them in any order, so long as there are no gaps in the numbers assigned. 

When the plan sponsor's EIN changes (for example, because of a merger), plan numbers arguably need to be re-assigned, although there is some ambiguity in the instructions. The changed sponsor identity or EIN should be reflected on item II.4. on page 2. The new plan number should be reflected in the plan number box. 

I am not aware of any rule permitting a new plan to be numbered 333 when there are not 332 other plans already sponsored (or previously-sponsored and assigned plan numbers) by the same employer (i.e., by an entity with the same EIN). If you made a mistake in assigning number 333 to a plan that should have been labeled 001, it should probably be corrected by filing an amended 5500 for each year that previously reflected the incorrect number. 

https://www.dol.gov/sites/dolgov/files/EBSA/employers-and-advisers/plan-administration-and-compliance/reporting-and-filing/form-5500/2021-instructions.pdf

[BG5150]

What about PEPs?  Are those the ones that should start with 3?

 

And further along in the section in the instrux says that 8a is filled out (pension codes), and a number 333 or higher is used, you should use that in 1b.  So 333 was contemplated somewhere.

[AKowalski]

5 minutes ago, BG5150 said:

What about PEPs?  Are those the ones that should start with 3?

I'm not aware of a special rule for PEPs, so I would expect them to start at 001, just like any other retirement plan associated with the same EIN. Please let us know if you find something. 

[RatherBeGolfing]

17 minutes ago, BG5150 said:

What about PEPs?  Are those the ones that should start with 3?

The final rule for PPP registration simply says to provide EIN and plan number.  A quick search of PPP registrations show plenty of 001, 002, 003, etc.  None starting with a 3.
 

[cathyw]

My recollection is that years ago if the plan was considered a "multiple-employer plan (other)" you had to use plan number 333.  That requirement apparently has been dropped, but the current instructions from Form 5500 state..."If Part II, line 8a is completed and 333 (or a higher number in a sequence beginning with 333) was previously assigned to the plan, that number may be entered on line 1b."