Summer is a time when HR compliance obligations heat up right along with outside temperatures, as the federal government requires certain plan report filings within seven months after the end of a plan year. For calendar-year plans, those federal deadlines fall right in the middle of summer. Specifically, it’s time for employers and benefit advisors to prepare Form 5500, an annual federal report required for most employee benefit plans. If your organization or client has calendar-year benefit plans, the 2022 Form 5500 is due July 31.

But I’m sure you already knew that.

What you may not have at the ready, though, are the answers to some of the frequently asked questions that Mineral’s HR Experts receive about Form 5500 for employer-sponsored health and welfare plans. Share them with your HR partners or clients to make this year’s filing deadline a (summer) breeze.

Don’t get burned by summer compliance deadlines: Your Form 5500 FAQ

Is Form 5500 required for our plan?

Probably. The Employee Retirement Income Security Act (ERISA) requires Form 5500 for employer-sponsored welfare plans with 100 or more participants as of the start of the plan year (generally Jan. 1). Participants count as all covered employees, retirees, and primary COBRA beneficiaries, but not dependents. Welfare plans include plans for medical, dental, vision, life, accident, and disability benefits, as well as health flexible spending accounts (FSAs) and health reimbursement arrangements (HRAs).

Information about plans that include group insurance coverage must be reported on Form 5500 Schedule A. Most welfare plans are unfunded—with benefits paid through group insurance contracts, an employer’s general assets, or a combination of both. For unfunded plans, Form 5500 filing will be the three-page Form 5500 only or Form 5500 with one or more Schedules A.

However, plans exempt from ERISA, and therefore exempt from Form 5500 filing, are those that are:

• Sponsored by governmental employers and churches.
• Employee-paid voluntary plans.
• Payroll.
• Maintained solely to comply with state workers’ compensation, unemployment, and weekly disability insurance laws.

How do I file Form 5500?

Form 5500 and any required schedules must be filed electronically using the Department of Labor (DOL) EFAST2 electronic filing system, using approved third-party vendor software or the DOL’s web-based filing system, IFILE.

Can I get a Form 5500 filing extension?

Yes. The filing deadline can be extended up to two and a half months (until Oct. 15), by applying for an extension using Form 5558, no later than the original July 31 filing deadline. In most cases, the IRS does not respond, which means the extension is automatically granted. Then, when filing Form 5500, be sure to check the appropriate box in Part I-D, to indicate that the due date was extended by filing Form 5558.

Part II of Form 5500 asks for basic plan information. Where do we find this information?

The information needed to complete Part II of Form 5500 will be found in your plan document and SPD.

Form 5500 Part III, line 8, asks for codes. What are the correct codes?

For a welfare plan, do not enter any codes on line 8a. Refer to page 20 in Instructions for 2022 Form 5500 for the index of Plan Characteristic Codes, then enter the appropriate code(s) on line 8b. Pro tip: Codes for welfare benefits, including health plans and group life and disability insurance, begin with “4.”

Part III, lines 9a and 9b, ask about funding arrangements and benefit arrangements. Help!

Breathe. We got you. On both lines, check the box for “Insurance” if the plan includes coverage provided through one or more group insurance policies (e.g., group life, medical, STD, LTD). Check the box for “General assets of the sponsor” if the plan includes any self-funded or uninsured coverages (e.g., HFSA, HRA, or other self-funded health plan). Many employers offer insured plans along with an HFSA, in which case both boxes will be checked. Do not check the boxes for 412(e)(3) contracts or trusts; these are uncommon arrangements requiring tax professionals or plan trustees to prepare the form.

First numbers, now letters! What about Form 5500 Schedule A and/or Schedule C?

Schedule A must be filed with Form 5500 if any plan coverages are provided through group insurance contracts. In that case, the insurance company will provide information about the policy, and information about any commissions or fees. Carriers are required to provide this information within 120 days after the end of the plan year. If the plan includes multiple group policies, such as separate policies for group life, PPO medical, HMO medical, dental, and vision, there will be a separate Schedule A for each one.

Schedule C is only required for large welfare plans that are funded through benefit trusts, which are uncommon. In that case, Form 5500 and all required schedules should be prepared by tax professionals or plan trustees.

See? Easy as ABC, 123. Happy filing!