On February 23, 2023, the U.S. Department of Labor (DOL), Internal Revenue Service (IRS) and the Pension Benefit Guaranty Corporation (PBGC) released Federal Register notices in which they announced the final rules on changes to the 2023 FORM 55 Annual Return/Report of Employee Benefit Plan and Form 5500 SF Short Form. Their goal in making these changes is to reduce overall filing costs for employee benefit plans by $95 million annually.
These recent changes feature a Notice of Final Forms Revision for the 2023 plan year forms, along with instructions and a Notice of Final Rulemaking that relate to corresponding changes to annual reporting regulations under Title 1 of the Employee Retirement Income Security Act of 1974 (ERISA).
According to Assistant Secretary for Employee Security Lisa M. Gomez, “The form changes and regulatory amendments, especially those on multiple-employer plan reporting, improve the Form 5500 as critical management, public disclosure and policy data tool.”
The final changes for 2023 plan year reports, which would typically be filed at the beginning of July 2024 for calendar year plans, include:
- A consolidated Form 5500 reporting option for certain groups of defined contribution retirement plans, improved reporting by pooled employer plans and other multiple employer plans.
- A change in the participant-counting methodology used in determining eligibility for simplified reporting alternatives available to “small plans,” which are plans with fewer than 100 participants.
- A breakout of reporting on administrative expenses paid by the plan on the plan’s financial statements.
- Further improvements in financial and funding reporting by PBGC-covered defined benefit plans.
- The addition of selected Internal Revenue Code compliance questions to improve tax oversight and compliance of tax-qualified retirement plans.
- Technical and conforming changes as part of the annual rollover of forms and instructions.
In addition to these changes, technical adjustments were made to the Federal Register notices to address certain provisions in the SECURE Act 20 of 2022 on Code section 403(b) multiple employer plans, including pooled employer plans, minimum required distributions, and audit requirements for plans in defined contribution group reporting arrangements.
For more information on compliance measures relating to these changes, please reach out to your third-party administrator for employee benefits and consult with your corporate or general counsel.