Form 5500 (item #8a)

[Guest Giovanni]

Just wondering how most people complete this question for a 401(k) plan where there are only 401(k) deferrals being contributed, yet the Plan does also allow for a discretionary match. Would you indicate a pension feature code of "2K", even though the Employer never contributed a match to the Plan?

[pmacduff]

We list all features per the Plan Document regardless of whether or not they are being utilized.

[RCK]

FWIW, I agree.

RCK

[jquazza]

To kick it up another notch, on Schedule T, I would report two exceptions:

-Box 3D for the 401(k) (providing there were no exclusions.)

-Box 3B for the other components of the plan (as no HCEs benefited in these sources.)

[WDIK]

Box 3d may cover both contributions. Under the instructions for line 4c(5) of Schedule T, it indicates when an employee is considered to be "benefitting." It states in part:

"[A]n employee is treated as benefitting under a plan...that provides for...matching contributions under Section 401(m) if the employee is eligible to...receive allocations of matching contributions even if none are actually made or received."

[Alf]

I agree that the feature should be listed, even if not used.

However, I have a relevant, but slightly different question about "frozen" or closed features. What if there was a participant directed brokerage account at one time (characteristic 2R), but it has been discontinued for new investments? I guess that is similar to having once made matching contributions, but then taking the discretionary contribution provision out of the document for future years. Do you still report the feature if still affects money in the plan, but is not currently available?

[pmacduff]

Alf - Excellent question...in looking at the definition below from the form 5500 instructions one could argue that PBAs are no longer "provided" in your plan because the "option" is no longer available. However I think I would include the feature as long as there are participants with PBA accounts. This sounds like a matter of semantics ! I would like to hear what others think......

"Participant-directed brokerage accounts provided as an investment option under the plan."