TommyGunn13

I had a similar situation happen years ago, the IRS eventually got in touch with a plan trustee for a late Form 5500 Filing(s) and penalties. Suddenly it was a priority to get the final 5500 done! The trustee was a former owner and anyone that actually worked on the plan was long gone and not answering their phones so he was left on the hook with the plan that he mostly ignored until the letter came. They were able to avoid the penalties but not without a lot of aggravation, pleading and added legal fees paid by the trustee, in addition to the fees to prepare the late filings.

We have almost a dozen providers for our plans and I have been going through the exercise of checking on their Cybersecurity practices in a attempt to comply with the DOL suggestion in the form of a questionnaire. There have been six providers that have responded so far and other than how they word their response there are not many variations between the providers responses. Most of the responses are generic in order to not disclose cybersecurity details that it feels like a check the box and never look at the results type of project. When we go for our next RFP we will be updating it to address the DOL listing more completely in our service agreements. ..... And yes, I know that is way too many providers, but almost all are legacy vendors that have individual contracts we can not move without a large cost at this time!

We report the actual amount of the coverage (5M) on our 5500's, and we have had a few Govt audits over the years. It has never been an issue.

they my have an appeals process built into the plan. You may try reaching out to see if they have one what it covers and how to make an appeal of a decision you do not feel is correct.

I agree, and have worked on large plans that report 5500 on cash basis and the auditor footnoted the audit report to reconcile to the 5500. Did not see it very often.

Starting in 2018 the plan instituted a required match on a payroll basis with a true up contribution to be funded each year. This matching true up computation period is on a calendar year basis. The plan is an off calendar year plan with a PYE of 9/30. The match true up was calculated based on the 2018 calendar year and the computation period crossed over two different plan years and was funded during PYE 9/30/2019. We are pulling year end census data including matching contribution data for plan year end testing and were questioning how to best include the match true up for testing. Is it appropriate to Include it as a contribution made in the PYE 9/30/2019 even though the computation period was over parts of two separate plan years? looking to see if someone else might have run into this before and how they handled it.

I do agree that it depends on the work involved more than the number of clients, but even with other teams taking on a lot of the day to day admin "stuff" 120 seems very high. I have worked with a few different companies that had cased loads in the 40's and others that they thought close to 100 clients would be reasonable. To be able to give a reasonable level of service consistently to clients (and we all know things get busier during testing and 5500) was close to impossible when the client count got to high even with a set up where other teams were supposed take care of other admin activities.

I don't run into this often, but the past three times I updated that field to signify a change in EIN the client got an IRS letter saying that the plan sponsor either did not file a form (looking for one under the old number) or it was supposed to be checked off that it was first return. Handled with a simple letter of explanation but was annoying and client though we had screwed up because of the letter.

Ran into a similar issue but it was only two years needed. Internally we determined that they needed separate audits (at least separate audit reports) which was agreed with by both outside ERISA Counsel and the independent auditors.

I echo Jack's comments. Unless the record keeper is willing (and able) to take full responsibility for this and making sure it is paid timely and you and the client are totally outside the process it can is best to avoid this situation. Had a client with this option for participants and they seemed to forgot to remit a payment (or sometimes more) each year because the participants checks were late compared to when they submitted a payroll contributions. The client ended up correcting the late payments each time since they held the participants funds... and of course it was a loan for a mortgage so it went on like this for years.

I have been doing it for years also, and never had an issue.