stevena Posted August 8, 2001 Posted August 8, 2001 What do you do if a company which was required to file a 5500 is purchased by a company not required to file a 5500? The plans are still seperate, not merged, but the sponsor of the plans is now the entity which is not subject to ERISA and is not required to file (gov entity).
david rigby Posted August 8, 2001 Posted August 8, 2001 Hmmm. It might help to know a bit more about the two plans: pension/PS plan? welfare plan? And why is the new plan sponsor not required to file? I think it's the nature of the plan that determines whether the 5500 is due. At the very least, it seems likely that the 5500 should be filed for the plan year in which it was "required." Instructions to 2000 5500: http://ftp.fedworld.gov/pub/irs-pdf/i5500.pdf. See Section 1: Who Must File. I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
Kristina Posted August 9, 2001 Posted August 9, 2001 I think you mean that the plans sponsored by the purchasing company are not covered by ERISA. It is my understanding (regarding qualified retirement plans only) that one files the 5500 for the plan. An employer whose plans are not covered by ERISA may elect to be covered by ERISA by, I believe, complying with the provisions of ERISA and an written election. The plan is thereafter covered by ERISA. This plan was covered by ERISA prior to the purchase and I believe that once covered, always covered. Kristina
JohnCheek Posted August 13, 2001 Posted August 13, 2001 There are a number of recent Advisory Opinions on the PWBA web site that address governmental plans, ie, plans where all of the participants are employees of a governmental entity (or only a diminimus number are not). If you think you can qualify as governmental, under the new sponsor, I think you should have the plan's attorney request an Advisory Opinion to that effect. If DOL accepts your position, you should be able to eliminate the ERISA auditing and reporting requirements (Form 5500 etc). However, you still have IRS and PBGC to deal with, and they don't have to agree with DOL's definition of "governmental" as it pertains to IRC funding standards, etc, or PBGC premiums. I think that means your attorney would then have to get some kind of ruling from IRS and PBGC, also. John Cheek CPA www.cpaSPAN.com
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