Tomorrow there will be a DOL webcast on the new Form 5500 electronic filing requirements which will go into effect for the 2009 plan year (for filings in 2010). I would highly recommend that practitioners and fiduciaries listen in for the following reasons:
(1) These webcasts are free to the public and generally contain great information that might not otherwise be available.
(2) At yesterday's Mid-Atlantic Pension Liaison Meeting that I attended in Washington, D.C., Michael Auerbach, Chief of the Division of Accounting Services for EBSA, gave a great overview of these new rules. Practitioners seemed surprised at the impact these rules will have on a number of aspects of the current 5500 process. A few of the surprises are as follows:
The current system had some grace periods built into the system that allowed plan sponsors to correct "deficient" filings before being hit with penalties. These grace periods usually followed the issuance of "form letters" to the sponsor telling them that they were deficient in some respect. It is my understanding after listening to the presentation, that these grace periods will be shortened and the sponsor will only have 45 days to correct a deficient filing before being hit with what are fairly significant penalties. Once the sponsor gets hit with penalties, the DOL indicated it will have very little discretion in providing relief to sponsors. These filings will now be online and accessible immediately when filed by all relevant agencies--IRS, DOL, and PBGC--meaning deficiencies may trigger such things as unwanted audits. Mr. Auerbach indicated that participants and beneficiaries will also be able to access the filing online by entering the sponsor's employer identification number. While such information was generally accessible on a more delayed basis through participant requests and other online resources, the information will now be immediately accessible once it is posted (i.e. a great place for plaintiffs' lawyers to hang out).