Nonprofit employers need flexibility from the U.S. Department of Labor to cope with new 403(b) plan Form 5500 filing rules, according to the American Society of Pension Professionals & Actuaries.
ASPPA, Arlington, Va., and its National Tax Sheltered Accounts Association division are following up on a request for transitional relief that they filed Oct. 8, 2010, with the Labor Department’s Employee Benefits Security Administration (EBSA).
Form 5500 is the form benefit plans use to submit reports on their operations to the Labor Department, the Internal Revenue Service and other federal agencies.
EBSA recently imposed a rule requiring the nonprofit employers that sponsor 403(b) retirement plans to file independent audit reports along with their Form 5500s. The 403(b) Form 5500 requirements have been in the works for years.
Many nonprofit employers have trouble meeting the financial statement requirements, and many find the cost of an audit – which can range from $50,000 to $100,000 per plan – to be staggering, ASPPA and the NTSAA say in a statement about the request for relief.
ASPPA and the NTSSA are asking for 3 main types of relief.
1. Opening Balance Relief
ASPPA and the NTSSA would like to see EBSA accept the financial statements of the employer based on a documented good faith effort and only require an auditor’s opinion for financial activity for the current year, assuming a correct opening balance. ASPPA and NTSAA say this measure would resemble transitional relief that was provided when