Large to small plan filing

[SusanKD]

A large plan 5500 filing and audit were complete for a plan for the past 2 years (2008 & 2009). The participant account at the beginning of 2010 is less than 100 employees. Can the small plan filing be completed for 2010 with the sponsor's approval? My personal opinion is that a large plan filing should be completed. Any thoughts? Thanks!

[BG5150]

I think, yes it can. And if the count is less than 80, a small plan filing MUST be made.

[Andy the Actuary]

From Form 5500 Instructions:

Generally, a return/report filed for a pension benefit plan or welfare benefit plan that covered fewer than 100 participants as of the beginning of the plan year should be completed following the requirements below for a “small plan,” and a return/report filed for a plan that covered 100 or more participants as of the beginning of the plan year should be completed following the requirements below for a “large plan.”

Use the number of participants required to be entered in line 5 of the Form 5500 to determine whether a plan is a “small plan” or “large plan.”

Exceptions:

(1) 80-120 Participant Rule: If the number of participants reported on line 5 is between 80 and 120, and a Form 5500 annual return/report was filed for the prior plan year, you may elect to complete the return/report in the same category (‘‘large plan’’ or ‘‘small plan’’) as was filed for the prior return/report. Thus, if a Form 5500 annual return/report was filed for the 2008 plan year as a small plan, including the Schedule I if applicable, and the number entered on line 5 of the 2009 Form 5500 is 120 or less, you may elect to complete the 2009 Form 5500 and schedules in accordance with the instructions for a small plan, including for eligible filers, filing the form 5500-SF instead of the Form 5500.