5500Nerd

Hello Everyone, We have a group that inadvertently formed a MEWA a few years ago and never filed the Form M1. They are debating to file them late now. Has anyone had any experience in doing this? Has anyone heard of group paying the very high penalty for not filing: $1992 per day late? Any advice would be greatly welcomed. Many thanks!

I really appreciate your input. Many thanks for taking the time to respond.

A very large PEO that files as a DFE - GIA does not provide the SAR to those who are participating. The participating employers are concerned of being out of compliance for the Plan participants. Has anyone had a remedy such creating their own SAR even though they did not prepare the 5500 or have the Schedule As from the carriers? Has anyone heard of any consequences for the participating employers? Many thanks for your assistance.

Hello, We have a group that is a MEWA and has 15 employer contribute. They are not under a trust. Is 4T to be used under 8b? It has over 10 employers but when I read up on its definition: 10 or more employer plan under Code section 419A(f)(6) and then read on 419, 419A and 419A(f)(6), it talks about a funded plan. However when I called the Efast Customer Service and the Office of Chief Accountant they did not know. They referred me to the Office of Regulations and Interpretations. This office does not call back consistently. Does anyone have any insight to help? Many thanks

Hi Everyone, I have an update for you. I spoke to the Office of Regulations and Interpretations of the DOL. They model notice has the Paperwork Reduction Act because this information needs to be seen by the Plan Sponsor/ the Employer. However it does not need to be in place for the participants. The employer can remove if they choose.

Hello. The DOL template for the SAR for welfare and pension plans includes the two-paragraph blurb on the Paperwork Reduction Act. However, in another location on the DOL website, there is instruction not to include the blurb. I called the DOL Office of the Chief Accountant to confirm which way to approach and they have to do research. Does anyone have advice on which way to approach? Many thanks!

I thank you greatly. And yes you are correct. This is for health and welfare plans that are unfunded. I am beside myself because I was told that they are to file a Schedule C for indirect compensation if over $100 but I have not found any back up to support this position. Thanks again for your feedback.

Hello Everyone, I have been informed that the Schedule C can be used for a large plan that is not under a trust if there are non-monetary funds/commissions to a broker of a $100 or more. I have always felt a Schedule C can only be used for a funded/trust filing. What are your thoughts? Is there any official written instructions on this? Many thanks!

I thank you greatly. Some day the DOL will write the instructions with specifics.

We are facing a debate: for a final Form 5500 report there is agreement that on page two of the Form 5500 the end of the Plan year participant count is left as zero. However, some have a covered persons count with those enrolled at the end of the Plan year on a Schedule A. Others have said that this is incorrect; the Schedule A also is to list zero. Can anyone settle the debate?

Thanks so much!

Hello, I wondered if anyone may know - Is the Plan year in the Form 5500 and the Form M1 to match? The instructions in the Form M1 do not provide instruction on this. On page two the instructions note to use the same identifying information but do not classify if the Plan year is to be included in this case. Any insight would be valuable. Many thanks!

Many, many thanks. I greatly appreciate hearing your thoughts on this.

We have more and more clients from NY and MA for instance who want PFML reported in the Form 5500 for health and welfare. It is deemed as self-insured. We need to list the benefit code on page two. Would you suggest using 4Q and note list PFML? We assume to list PFML in the SAR as well. Any thoughts/feedback?

We have been told yes but when I looked, I could not find any details on the DOL Form M1 look up. Seems that the MEWA are considering themselves as Non-ERISA Plans. I cannot say for certain, but my guess is that they are considering themselves as funding mechanisms and not employers. I instructed the groups to seek the advice of an ERISA attorney. Conservatively I think that they need to file as single employers. I still question though since funds were sent, and the clients don't administer the plan.

Hello, I have a few clients who are participating employers of H&W MEWAs. The MEWAs hold trusts but for reasons unknown, they are not filing Form 5500s. Do the participating employers file 5500s for themselves, and if yes, do they file as a trust even though they are not the Plan Administrator of a trust but sent funds to a trust?

I have a group that was a MEWA for seven years. They never filed as a Multiple Employer although on their 5500 (they marked multiemployer by mistake). We will be amending. However, as a MEWA they were also to have filed the Form M1. They are petrified of dealing with penalties. We thought to attach a letter to explain. Has anyone witnessed a group paying hefty fines for not filing the Form M1? Did they go through an audit for amending the 5500 to be a Multiple Employer? Many thanks in advance for your help.

Some use the 5500s to determine the count for the PCORI fee. Our client had this scenario and question. I wondered if anyone could assist: “Original” ERISA Plan Year : 6/1/19 – 5/31/20 Short ERISA Plan Year: 6/1/20 – 6/30/20 New ERISA Plan Year 7/1/20 -6/30/21 As this group is technically self-funded for their medical plan, they are required to pay the PCORI fee. This poses a challenge this year as they actually have two plan years which end before October 1, 2020 as highlighted above which would need to be accounted for in the upcoming PCORI fee filing. As we know, the IRS does require the PCORI fee to be paid for a short plan year. The Group typically uses the snapshot method, However, the form does not provide a spot to account for multiple plan years (e.g. the average covered lives in tis case would need to be identical to “fit” within this form.). Can you offer any guidance on how the group should address this short one month plan year when paying the PCORI fee?

Hello, I first freely admit that I am not able to understand the inner workings of captive insurance. It remains as a mystery. Never the less, I am preparing a health and welfare Form 5500 and the group notes that they have a self-funded captive benefit. I assume to treat this as a self-funded benefit and ask for no Schedule As. However I thought best to check. Can anyone provide some insight for me on this subject? Many many thanks!

Hello Everyone, I have a client that has a mega-wrap ERISA Plan on a January 1 Plan year: multiple benefits are bundled. All except medical are under fully-insured policies or self-funded using general assets. Medical is under a trust, and we have marked "trust "on page 2 of the 5500 (along with insurance and general assets). The trust portion came to an end on April 30, 2019. Everything else remained the same. Is the 5500 to have a final report on April 30th due to the trust and a new Plan going forward. Or do we continue to file with the January 1-December 30th ERISA Plan year? I asked the DOL but have not heard back yet.

Good Point. I will look into that angle.

Are Health Care Sharing Ministries subject to ERISA if the benefit is endorsed by the employer/Plan Sponsor? Many, many thanks for your help!

I have a client that is deemed a tribal government that runs a casino. Their benefits plan covers both governmental employees and those who work in the casino. With the casino attribute I assume they need to follow ERISA law. For the Form 5500, do I only count those in the casino or all of the employees? Many thanks for your help.

Hello, I realize that the 5500 has the special extension authorized by the IRS. The EBSA came out with its special extensions which don't apply to the Form 5500 report. However, I wondered if the Summary Annual Report of the 5500, the SAR, as a disclosure notice, would have EBSA's Disaster Relief Notice - 2020-01 extension of March 1 - 60 days after the Covid 19 National Emergency has ended. The Office of Regulations and Interpretations has not returned my calls yet on my question. Does anyone else know? Also the the EBSA press release said to use a good faith effort to issue disclosures and one of the methods was text messages. When was text messages allowed for electronic disclosures? EBSA Disaster Relief Notice 2020-01 extends the time for plan officials to furnish benefit statements, annual funding notices, and other notices and disclosures required by ERISA so long as they make a good faith effort to furnish the documents as soon as administratively practicable. The notice explains that good faith includes the use of electronic alternative means of communicating with plan participants and beneficiaries who the plan fiduciary reasonably believes have effective access to electronic means of communication, including email, text messages, and continuous access websites.

Hello Everyone, I heard from the Department of Labor: the box for collectively-bargained plan is to be checked.