Form 5500, Lines 6 and 7

[steve-o]

I am working on a 5500 and am having trouble with the active participant rules for Lines 6 and 7 of the form.

At BOY, the company had 105 employees with account balances - I assume this is the number of participants at BOY.

At EOY, there were 76 employees listed as active with account balances, 28 listed as terminated and 1 retired. 13 of the terminateds/retirees had a zero balance at EOY.

Does this mean I am now down to 92 for EOY count on Line 7g? What about the other 16 terminateds who are to get their money? The instructions to the 5500 say not to include "any individual to whom an insurance company has made an irrevocable commitment to pay all the benefits to which the individual is entitled under the plan". Does that exclude the group of terminateds who will get their money but haven't done so yet?

As long as the total for the beginning of next year is under 100, that is the main goal here. Thanks for the help.

[WDIK]

At BOY, the company had 105 employees with account balances - I assume this is the number of participants at BOY.

There is a possibility that some employees entered the plan on or prior to the BOY and do not have account balances. They would still be counted for this entry.

The instructions to the 5500 say not to include "any individual to whom an insurance company has made an irrevocable commitment to pay all the benefits to which the individual is entitled under the plan". Does that exclude the group of terminateds who will get their money but haven't done so yet?

No, these individuals are included on line 7c.

Does this mean I am now down to 92 for EOY count on Line 7g?

Again, someone could be an active participant without an account balance, but assuming all actives have account balances, I agree with your count.

7a - 76

7c - 16

7g - 92

[pmacduff]

As WDIK points out - even if 92 is your EOY count for 2003 - if there were 8 or more "new entrants" as of 01/01/2004, it could take your count up over 100 for the 2004 plan year(BOY count) so be sure and check carefully.

(Sorry - I had to edit the plan years per the original thread!!)

[steve-o]

Thanks for the help! That should get me on my way.