File Retention

[Guest bernverd]

What is the retention for pension files?

[Jim Chad]

At a seminar by the DOL, the speaker said you should save for 6 years STARTING FROM THE DUE DATE OF THE 5500. So she was saying 8 years. 8 years were her actual words.

I also save distribution files forever. I am a bit paranoid about someone's spouse coming to collect in 20 years. I would like to be able to show when it was paid out. Of course, on takeover plans, I can only do so much.

[J Simmons]

ERISA section 107 specifies retention "for a period of not less than six years after the filing date of the documents based on the information which they contain, or six years after the date on which such documents would have been filed but for an exemption or simplified reporting requirement"--just like Jim Chad recalls the DoL official explaining.

[rcline46]

You should keep plan documents and anything relating to the computation of benefits forever. This according to the IRS. THe prior responses only pertain to the Form 5500.

[Guest bernverd]

Wow!! We're running out of storage room quickly.

Do you know if the documents can be stored electronically?

[rcline46]

The PLAN SPONSOR must keep everything indefinitely. The service provider does not. This should be communicated quite clearly to the sponsor.

Yes, the information may be kept electronically, but read the regs on electronic storage. In brief, you had better be able to retrieve the information you store. CHange in technology is no excuse for lack of retrieval. Those who stored on computer tapes not so long ago had to convert to other mediums.

[Kimberly S]

The PLAN SPONSOR must keep everything indefinitely. The service provider does not. This should be communicated quite clearly to the sponsor.

And do your clients actually do that rather than running to you for documents any time they are audited?

[Belgarath]

Our clients always ask us to provide all the documents, because they "can't find them." As soon as we explain that we will be happy to provide them the requested documents for a fee of (x) they magically locate them about 95% of the time.

[Kimberly S]

95% is impressive. Apparently we aren't charging enough!

[Guest amycavanaugh]

According to DOL regulations, electronic media may be used for purposes of complying with the record retention requirements provided the following requirements are met:

• The recordkeeping system has reasonable controls to ensure the accuracy of the records;

• The recordkeeping system should be capable of indexing, retaining, preserving, retrieving and reproducing the electronic records. The retrieval issue becomes more interesting as equipment is updated and upgraded. For example, records retained on floppy disks may fail this test, if no system drives are maintained to read that media;

• The electronic records can be readily converted into legible paper copies;

• The electronic recordkeeping system is not subject to restrictions that would inappropriately limit the access to the records.

Most original paper records may be disposed after they are transferred to an electronic recordkeeping system, provided the recordkeeping system complies with the above requirements. It is important to note that the original may not be discarded if it has legal significance or inherent value in its original form (e.g., notarized documents, insurance contracts, stock certificates, and documents executed under seal).

[BG5150]

I just throw my stuff out when I'm done with it. I just recently tossed the 2006 ADP test and Profit Sharing allocations after I did the 2007 work. Plus I throw out enrollment & distribution forms after they are processed. And when I get a plan document, I put the information onto a highlight spreadsheet I created and I lost that, too.

Is that bad, then?

[Tom Poje]

yes, the least you can do is recycle. get with it!

[Below Ground]

Bart, I recommend that you BURN materials; preferably immediately after use. But be positive. Use the event like a company picnic. Marshmellos, hot dogs, hamburgers, brats. Do it all!

[Guest amycavanaugh]

The recordkeeping responsibility falls on the Plan Administrator not the TPA, that said, I always suggest that you state specifically in the service agreement what your record retention policy is and then if they expect you to keep stuff, charge them accordingly.

This is such a paper intensive business and even with e-signatures (even for documents) and internet, there is still paper everywhere