Year-end plan notices - what, why, when
We trust you signed and filed your Form 5500 by the extended deadline this year of October 17, 2022. If you are not sure, please contact your plan administrator ASAP.
November and December ring in year-end notices along with the holidays. While many plan record keepers now cover this important task for employers, some (especially smaller plans) are on a more DIY program.
Here's a quick primer on the notices that need to go out at year-end. Please note that not all will apply to your plan.
Fee Disclosure - also known as 404(a)(5): This notice is required for all retirement plans. The notice discloses all administrative and investment expenses for your retirement plan. It also includes performance data, and instructions for making changes to your investments. It must be sent out annually (at least once in any 14 month period). Most record keepers provide or send in November.
QDIA (Qualified Default Investment Alternative) Notice: This notice discloses how a plan participant's contributions will be invested by default (if they give no other instructions). It must be sent out at least 30 days prior to the first day of a plan year and is generally sent out with the Fee Disclosure notice.
ACA (Automatic Contribution Arrangement) Notice: This notice only applies if your plan has auto-enrollment. It needs to go out within a reasonable period of time before a new plan year. It is also generally sent out with the Fee Disclosure notice.
Safe Harbor Notice: When required, the Safe Harbor notice needs to be sent out 30 to 90 days before the beginning of the a plan year. While the Secure Act eliminated the requirement for Safe Harbor 3% Non-elective plans, the notice is still required for plans utilizing a Safe Harbor matching formula, and in some other instances. Check with your plan administrator if you are not sure if it applies to you. This notice is also generally included with the other year-end notices.
Summary Annual Report (SAR): The Summary Annual Report is a recap of your IRS Form 5500 filing that has to be sent to employees after the filing is complete. The SAR has to be sent within 9 months after the end of the plan year or 2 months after the Form 5500 deadline in the event of an extension. Most plans have a December 15th deadline if they are on a calendar year and file an extension. If no extension, calendar year plans must send the SAR by September 30.
While these are the common year-end notices, our list is not exhaustive and you can access IRS Publication 5411, Retirement Plans Reporting and Disclosure requirements HERE.