Duty to Revise Summary Annual Report (SAR)?

[MWeddell]

An employer timely filed a Form 5500. The DOL recently rejected the filing as incomplete under ERISA Section 104(a)(4), informing the employer that a revised filing must be made within 45 days. The employer plans to file a revised Form 5500 within that time period.

Is there an obligation to distribute a new Summary Annual Report to participants? Does it depend on how significant an impact the Form 5500 changes would have on the SAR? Is anyone aware of any DOL position on the issue?

[Guest]

The real question is what is being changed on the 5500 with the new filing. IF no material change, then no amended SAR.

[MWeddell]

Intuitively I agree with you, b2kates, but I can't find any authority telling me that's the correct answer.

[Kristina]

The Summary Annual Report is a summary of the 5500 series as filed with the DOL. (First paragraph of the SAR.) Therefore, if any of the information changes on the SAR because of the revised filing, a revised SAR should be distributed.

[KIP KRAUS]

I’ve never had an entire 5500 rejected by the IRS or DOL. Both have asked for certain items to be checked off that were inadvertently missed. Must have been some major errors for them to reject the entire filing. As everyone else has said, I think you could argue that there is no obligation to revise a SAR if no material items in it are being changed resulting from the revised filling. On the other hand, if the cost to issue a revised one isn’t prohibitive why not just do it and indicate that it is a corrected SAR?

[MWeddell]

It's my client's decision, not mine, whether to revise and redistribute the SAR.

The client would prefer not to because of the distribution costs and dealing with questions about why old SARs are being revised now. Although the DOL rejected the Form 5500, the client subjectively thinks the original SAR disclosed the plan's financials and hardly anyone reads those darn reports anyway.

Subjectively, the client sees little value in new SARs and has asked me how sure am I that a revised SAR is required. I follow the intuitive logic of "if Form 5500 is materially revised, summary of Form 5500 should be revised" but cannot locate a citation to back up the logic.