Is Change Coming for 403(b) Plan 5500 Filings?
Experts from Groom Law Group and CAPTRUST answer questions concerning retirement plan administration and regulations.
Kimberly Boberg, Taylor Costanzo, Kelly Geloneck and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:
A: You have heard correctly! On February 23, the Department of Labor released its 2023 Form 5500 changes, which modified the participant counting methodology for small/large plan determination from all eligible participants to only those participants with account balances at the beginning of the year. This counting method will push many plans (especially 403(b) plans, due to the universal availability issue that you referenced) below the audit threshold, potentially saving plan sponsors time and money.
The bad news is that the changes are not effective until the 2023 5500 filing, which means that you are stuck with the audit requirement for one more year (the 2022 plan year).
NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.
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