Final 5500 for 401(k) Plan

[Guest ARuper]

I have a plan that is merging their single employer 401(k) Plan into a mulit-employer plan. The final 5500 for the plan needs to be filed, but I am not sure what the time frame for filing this form is. any help would be appreciated.

Thanks,

Amy

[E as in ERISA]

The legal date of the merger is generally the ending date for the single employer plan (as opposed to the date that the assets in that trust go to zero like in a plan termination). But that is not a hard and fast rule. It depends on whether the both the plan and trust documents are properly amended, so that the new plan and trust control at that date.

Then you must file within 7 months of the month in which that merger occurs.

[Guest lforesz]

Katherine,

I panicked a bit when you said that the legal date of the merger is the ending date of the plan.

We have plans that merged effective 2/1/02 but the assets were not actually transferred until March. Would you say the Form 5500 is due in September or October? We were thinking October but we may have it wrong. Do you have any cites as to what the last day of the plan year is for the merged plan? The date of the merger or the date the assets are physically transferred?

[E as in ERISA]

The 5500 for a plan merging in February is generally due in September.

That's been my understanding for so long -- I don't have documentation anymore. I can't remember if there are specific regs or rulings. The 5500 instructions provide a special exception for plans that are terminating -- i.e., you use the date of distribution not legal date of termination. But there is no special rule for mergers -- so you actually use the date that legally is the end of the plan year.

The plan documents should support that conclusion. The plan that is merged 2/1/02 ceases to exist on that date from a legal standpoint (and hopefully both the plan and trust documents give control to the plan and trust into which it is merging on that date -- otherwise you are in a grey area).

I'm pretty certain of my answer. There has been a lot of discussion about whether a plan that merges on 1/1 has to have a one day audit and file a one day 5500. It was my understanding that for a long time Ian Dingwall at the DOL was very adamant that the one day audit and 5500 were required, but that he possibly has a non-enforcement policy at this time. But the point is that wouldn't be an issue if you didn't use the merger date.

[Earl]

Seems to me that when you legally merge the plans, the assets, where ever they are held, become assets of the surviving plan and you have an empty trust/plan that has a final filing due date in 7 months.

Just because you "forget" to change the Trustee/Plan Name or don't move the money to a new set of investment options, I don't think the plan continues to live.