What if a 403(b) plan falls under Title 1 of ERISA?
If it is the ERISA counsel’s opinion that a 403(b) plan falls under Title 1 of ERISA, there will be an increase in the information required to be provided on the plan’s 2009 Form 5500. In addition, a plan sponsor must determine if the plan will require an audit. The differentiation is whether a plan is classified as a small plan or a large plan. This distinction is critical as this will determine the plan’s audit requirement. Generally, a “pension benefit plan that covers more than 100 eligible participants as of the BEGINNING of the plan year” is considered to be a large plan and thus requires an audit. Pay close attention to the Form 5500 instructions definition of a participant. Generally, the eligible category includes active participants (those in the plan or who are eligible to be); retired or separated participants currently receiving benefits; retired or separated participants entitled to future benefits; and deceased individuals who had one or more beneficiaries receiving or e
