Final rule for Form 5500 benefits reporting released

Beginning with the 2022 benefit plan year, there are some changes your Benefits people need to be aware of for filing Form 5500, Annual Return/Report of Employee Benefit Plan, and Form 5500–SF, Short Form Annual Return/Report of Small Employee Benefit Plan.

On May 20, IRS, the Dept. of Labor (DOL), the Treasury Department and the Pension Benefit Guaranty Corporation released a Federal Register notice of the final form and instruction revisions for the required annual reporting of employee benefit plans.

A separate Federal Register notice was published in December 2021 that announced changes adopted as part of the Form 5500 series reports for the 2021 plan year.

New for Form 5500, 5500-SF

Going forward, here are some of the highlights that may apply to your organization:

1. There are changes involving the reporting on actuarial and retirement plan schedules – specifically Schedules MB, SB and R – filed by defined benefit pension plans subject to Title IV of the Employee Retirement Income Security Act of 1974 (ERISA).
2. The final rule adopts additions to the plan characteristics codes that get reported on line 8 of Form 5500 and on line 9 of Form 5500-SF. They’re designed to improve the data reported on defined contribution multiple employer plans, including pooled employer plans.
3. The instructions now contain clarifications related to Part II of Form 5500 and Form 5500-SF that collect plan sponsor and plan administrator information.
4. The notice’s appendices illustrate all the changes to the forms and instructions.

The online posting of “information only” mock-ups of forms and instructions will happen later this year in advance of the annual January 1 live date for online EFAST2 filings.

Filings for the 2022 plan year generally won’t be due until seven months after the end of the 2022 plan year (i.e., July 31, 2023) for calendar year plans. A two-and-a-half-month extension is available by filing IRS Form 5558, Application for Extension of Time to File Certain Employee Plan Returns, on or before the due date.

Related changes coming?

According to the DOL, the agencies anticipate publishing a notice that addresses elements of the September 2021 Form 5500 Notice of Proposed Form Revisions and Notice of Proposed Rulemaking, including proposals related to:

• a Schedule MEP for multiple employer plans
• a consolidated reporting option for certain defined contribution reporting groups
• new tax code compliance questions, and
• the plan size threshold for an annual audit by an independent qualified public accountant.

The DOL said the agencies are still reviewing public comments on the September 2021 proposal. They’re also evaluating the best way to coordinate form, instruction and regulatory changes with the annual contractual development schedule for the EFAST2 filing system.