As the year draws to a close there are many things that a Plan Sponsor providing a 401k plan needs to ensure they are doing in order to adhere to regulatory legislative requirements.
One place to start is to confirm that all plan participant notices have been sent. Notices to all plan participants are required to be sent annually for transparency and disclosure purposes. Depending upon your plan you may have different types of notices but most of the 401(k) and 403(b) plan sponsors are responsible for the following notices; Summary Plan Description (SPD) and Summary of Material Modifications, Automatic Enrollment, Qualified Default Investment Arrangement Updates, Fee Disclosure, Safe Harbor, Summary Annual Report.
The Plan Sponsor must also ensure that they are maintaining updated mailing information, tracking delivery dates, and confirming receipts of participant notices.
Review your plan documents and make sure that they are kept current and adhere to current laws and regulations. You must also ensure that ALL of your amendments are properly signed and that any of your third-party administrators such as your TPA and/or record keeper have the updated documentation. Your TPA needs to know what has transpired during the year. Not only do they need the updated documents, but they also need the updated employee record information such as hire/terminations/rehire/birth date etc.
Prior to filing your Form 5500, make sure to carefully review your submission and form once completed prior to filing.
Plan Sponsors that are required to maintain an ERISA bond need to ensure that they are meeting the fiduciary requirements of the policy. Although not required, having fiduciary liability insurance for the fiduciaries is a good practice. If you don’t have it this would be a good time to look into it and if you do have fiduciary liability insurance this would be a good time to review your current policy.
Too many times we have seen Plan Sponsors neglect their annual review of their 401(k) plans and then run into future problems that could have been prevented. We can help you! We can serve as your “delegated” ERISA 3(16) Fiduciary Administrator and ensure the proper administration of your 401(k) plan. Click on “Meet Your New BFF®”above to find out how we can help you.