E-Filing of Form 5500 Now Mandatory
| Abbreviations Key |
| ERISA: Employee Retirement Income Security Act of 1974 |
| EFAST2: New electronic ERISA Filing Acceptance System |
| EFAST: ERISA Filing Acceptance System (for paper returns) |
| DOL: Department of Labor |
| Form 5500: Annual Return/Report of Employee Benefit Plan |
| Form 5500-SF: Short Form Annual Return/Report of Small Employee Benefit Plan |
| Form 5500-EZ: Annual Return of One-Participant (Owners and Their Spouses) Retirement Plan |
| EBSA: Employee Benefits Security Administration |
All pension and welfare plan sponsors required to submit an annual report (tax return) under Title I of ERISA must use the new computerized system, EFAST2, for reporting years beginning on or after January 1, 2009.
Under the DOL’s final rule on annual reporting and disclosure, effective January 1, 2010, EFAST2 is the only acceptable filing system for Forms 5500 and 5500-SF, along with any required schedules and attachments. The only exception relates to Form 5500-EZ for the 2009 reporting year, which cannot be taken care of electronically. So, for that return, use the old system to submit a paper filing to the IRS.
“This mandatory online filing requirement for 2009 could be a difficult change for many plan sponsors,” says Darren Paumen, a benefit services manager with LarsonAllen. “Accessing the EFAST2 Web site early is important, especially since you have to obtain credentials to electronically sign and submit returns.”
According to the DOL, the filing system went electronic to increase the accuracy and efficiency of reported plan information used by the government and public. This change will affect more than one million retirement and other employee benefit plans.
What to know before e-filing
- EFAST2 is required for small (fewer than 100 participants) and large plans.
- Sponsors must obtain credentials to use EFAST2.
- Tax filers have a choice between using EFAST-approved third party software or IFILE.
Registering for EFAST2 credentials
Get your credentials through the EFAST2 registration Web page. The DOL’s Web site describes five user types:
- Filing authors can complete Forms 5500 and 5500-SF and the accompanying schedules, submit the filing, and check filing status. They cannot sign filings unless they also have the “filing signer” role.
- Filing signers can sign Forms 5500 and 5500-SF. Signers must ensure the filing is complete and accurate prior to submission.
- Schedule authors can complete one or more of the schedules that accompany Forms 5500 and 5500-SF.
- Transmitters can transmit Forms 5500 and 5500-SF filings to EFAST2 for processing on behalf of others. They are responsible for the security of all filing information prior to and during transmission. A transmitter can be a company, trade, business, or individual.
- Third party software developers make the Form 5500 filing preparation or transmission software for use in the EFAST2 system.
After you’ve selected your user type and registration is complete, you’ll receive a receipt and login instructions via email. You’ll need your credentials to sign and transmit your organization’s tax return, even if a third party administrator is preparing it.
Handling 2008 and older filings
Plan sponsors can use the old or new processing system when it comes to filing 2008 returns/reports:
- EFAST2 using approved 2008 third party software until June 30, 2010
- EFAST using approved 2008 software or government-issued paper forms until October 15, 2010
According to the EBSA, all other delinquent or amended Title I ERISA filings must be submitted through EFAST2. In other words, you can’t paper file them.
How we can help
If you have questions about the new annual report requirements for employee benefit plans or using EFAST2, contact Darren Paumen at dpaumen@larsonallen.com or 320-203-5830, Kelly Davis at kdavis@larsonallen.com or 480-615-2383, or a benefit services principal in your region.
Helpful DOL resources