Master Trust/MTIA Form 5500 filings

[Guest LAnderson]

Hi-

I have a client that has a Master Trust. The MT holds the following groups of assets:

Retirement Strategy Funds (5 or 6)

Money Market Fund

Company Stock

Mutual Funds

The client calls each of these groups "MTIAs", and has been filing a separate 5500 for each of them, as well as a 5500 for the MT itself. Schedule H for the MT itself shows one line for "investment in MTIA" and each MTIA's 5500 reports the actual investment on its Schedule H.

My question - is it necessary to file 5 separate Forms 5500? Can the MTIA investments be combined onto the MT Form 5500, and listed as separate line items on the MT's Schedule H? It seems like they are going through a lot of extra hoop jumping by filing under their current structure.

Anyone have any thoughts?

Thanks!

Laura

[JanetM]

Unless there is something really bizarre about how the trust is setup they should just file one MT 5500 showing all the detail of all assets. Then each plan in the MT will have single H line item showing investment in MT.

Trust agreement is where you have to start. Then look at agreements with the different investment managers to see if there is something goofy there.

[401(k)guru]

Janet,

I do not think it is all that unusual to have to submit more than one 5500 for what we would consider one MTIA. I have quoted the instructions to the 5500 below. I have encountered situations that do not meet the mutual fund, commingled, etc examples in a DC plan and must file a separate 5500 for that investment.

"The assets of a master trust are considered for reporting purposes to be held in one or more "investment accounts." A "master trust investment account" may consist of a pool of assets or a single asset. Each pool of assets held in a master trust must be treated as a separate MTIA if each plan that has an interest in the pool has the same fractional interest in each asset in the pool as its fractional interest in the pool, and if each such plan may not dispose of its interest in any asset in the pool without disposing of its interest in the pool. A master trust may also contain assets that are not held in such a pool. Each such asset must be treated as a separate MTIA.

Notes.

(1) If a MTIA consists solely of one plan's asset(s) during the reporting period, the plan may report the asset(s) either as an investment account on a MTIA Form 5500, or as a plan asset(s) that is not part of the master trust (and therefore subject to all instructions concerning assets not held in a master trust) on the plan's Form 5500. (2) If a master trust holds assets attributable to participant or beneficiary directed transactions under an individual account plan and the assets are interests in registered investment companies, interests in contracts issued by an insurance company licensed to do business in any state, interests in common/collective trusts maintained by a bank, trust company or similar institution, or the assets have a current value that is readily determinable on an established market, those assets may be treated as a single MTIA. "