Summary Annual Report (SAR)

[Nassau]

Who needs to receive the Summary Annual Report (SAR)?

My client is under the impression that anyone who had a balance during the plan year is supposed to receive a SAR. Can you clarify? If I am in the plan and terminate on 1/10/2009, do I need to receive a SAR for the 12/31/2009 plan year?

[Guest Sieve]

I would say that there is no requirement to furnish an SAR to someone who has been paid his/her full account balance, even if the SAR relates to a plan year during which the individual was a participant. The SAR must be disclosed on an annual basis to "each participant of [the] plan" (DOL Reg. Section 2520.104b-10(a)), and there is no requirement in the regs that disclosure is based on those who were participants during the year to which the SAR relates. (Note that the SMM disclosure rules do not require an SMM describing an amendment that has retroactive application to be disclosed to those who might be retroactively impacted. Treas. Reg. Section 2520.104b-3(a).)

But, if full distribution of benefits has not yet been made, the individual is still a participant & must receive an SAR. (See ERISA Section 3(7), which defines a participant as "any employee or former employee . . . who is . . . eligible to receive a benefit . . .")

[BG5150]

...and beneficiaries get one, too. (not sure about QDRO accounts)

[GMK]

... and I would include new participants even if they do not yet have anything in their account balance.