[Federal Register Volume 86, Number 176 (Wednesday, September 15, 2021)]
[Proposed Rules]
[Pages 51488-51575]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-19714]



[[Page 51487]]

Vol. 86

Wednesday,

No. 176

September 15, 2021

Part III





Department of Labor





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Employee Benefits Security Administration





Department of the Treasury





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Internal Revenue Service





Pension Benefit Guaranty Corporation





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26 CFR Part 301

29 CFR Parts 2520 and 4065





Proposed Revision of Annual Information Return/Reports; Proposed Rule

Federal Register / Vol. 86 , No. 176 / Wednesday, September 15, 2021 
/ Proposed Rules

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DEPARTMENT OF LABOR

Employee Benefits Security Administration

29 CFR Part 2520

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 301

PENSION BENEFIT GUARANTY CORPORATION

29 CFR Part 4065

RIN 1210-AB97


Proposed Revision of Annual Information Return/Reports

AGENCY: Employee Benefits Security Administration, Labor; Internal 
Revenue Service, Treasury; Pension Benefit Guaranty Corporation.

ACTION: Notice of proposed forms revisions.

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SUMMARY: This document contains proposed changes to the Form 5500 
Annual Return/Report forms filed for employee pension and welfare 
benefit plans under the Employee Retirement Income Security Act of 1974 
(ERISA) and the Internal Revenue Code (Code). The proposed form 
revisions primarily relate to statutory amendments to ERISA and the 
Code enacted as part of the Setting Every Community Up for Retirement 
Enhancement Act of 2019 (SECURE Act). The Department of Labor (DOL), 
the Internal Revenue Service (IRS), and the Pension Benefit Guaranty 
Corporation (PBGC) (collectively ``Agencies'') are also proposing 
certain additional changes intended to improve reporting on 
multiemployer defined benefit pension plan funding, update Form 5500 
financial reporting to make the financial information collected on the 
Form 5500 more useful and usable, enhance the reporting of certain tax 
qualification and other compliance information by retirement plans, 
and, transfer to the DOL Form M-1 (Report for Multiple Employer Welfare 
Arrangements (MEWAs) and Certain Entities Claiming Exception (ECEs)) 
(Form M-1) participating employer information for multiple employer 
welfare arrangements that are required to file the Form M-1. The 
proposed revisions would affect employee pension and welfare benefit 
plans, plan sponsors, administrators, and service providers to plans 
subject to annual reporting requirements under ERISA and the Code.

DATES: Written comments must be received by the Department of Labor on 
or before November 1, 2021.

ADDRESSES: You may submit written comments, identified by RIN 1210-
AB97, by one of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments. To facilitate receipt and 
processing of comments, the Agencies encourage interested parties to 
submit their comments electronically.
    Mail: Office of Regulations and Interpretations, Employee Benefits 
Security Administration, Room N-5655, U.S. Department of Labor, 200 
Constitution Ave. NW, Washington, DC 20210, Attention: Proposed Form 
5500 Revisions RIN 1210-AB97.
    Instructions: All submissions must include the agency name and 
Regulatory Identifier Number (RIN) for this rulemaking. The Agencies 
will share any comment submitted to one of the Agencies individually 
with the other Agencies. To avoid unnecessary duplication of effort, 
the DOL also will treat public comments submitted in response to this 
Notice of Proposed Forms Revisions as public comments on the Notice of 
Proposed Rulemaking to the extent they include information relevant to 
the proposed regulatory amendments. If you submit comments 
electronically, do not submit paper copies. Comments will be available 
to the public, without charge, online at: http://www.regulations.gov 
and http://www.dol.gov/agencies/ebsa and at the Public Disclosure Room, 
Employee Benefits Security Administration, Suite N-1513, 200 
Constitution Ave. NW, Washington, DC 20210.
    Warning: Do not include any personally identifiable or confidential 
business information that you do not want publicly disclosed. Comments 
are public records posted on the internet as received and can be 
retrieved by most internet search engines.

FOR FURTHER INFORMATION CONTACT: Janet Song or Colleen Brisport 
Sequeda, Office of Regulations and Interpretations, Employee Benefits 
Security Administration, U.S. Department of Labor, (202) 693-8500 for 
questions related to reporting requirements under Title I of ERISA. For 
information related to the IRS changes and questions under the Internal 
Revenue Code, contact Cathy Greenwood, Employee Plans Program 
Management Office, Tax Exempt and Government Entities, (470) 639-2503. 
For information related to PBGC changes, including proposed changes to 
the actuarial schedules, contact Karen B. Levin, Regulatory Affairs 
Division, Office of the General Counsel, Pension Benefit Guaranty 
Corporation, (202) 229-3559.
    Customer service information: Individuals interested in obtaining 
general information from the DOL concerning Title I of ERISA may call 
the EBSA Toll-Free Hotline at 1-866-444-EBSA (3272) or visit the DOL's 
website (www.dol.gov/agencies/ebsa).

SUPPLEMENTARY INFORMATION: 

I. Overview of the Proposal

A. Background of Form 5500 Annual Return/Report of Employee Benefit 
Plan

    Sections 101 and 104 of Title I and section 4065 of Title IV of the 
Employee Retirement Income Security Act of 1974 (ERISA) and sections 
6057(b), 6058(a), and 6059(a) of the Internal Revenue Code of 1986 
(Code), and related regulations, impose annual reporting and filing 
obligations on pension and welfare benefit plans, as well as on certain 
other entities. Plan administrators, employers, and others generally 
satisfy these annual reporting obligations by filing the Form 5500, 
Annual Return/Report of Employee Benefit Plan (Form 5500), or Form 
5500-SF, Short Form Annual Return/Report of Small Employee Benefit Plan 
(Form 5500-SF) (together ``Form 5500 Annual Return/Report'').\1\ 
Specifically, filing of the Form 5500 or the Form 5500-SF, as 
applicable, with any required schedules and attachments in accordance 
with the instructions and related regulations, constitutes compliance 
with the applicable annual reporting requirements under Title I of 
ERISA and the Department's implementing regulations.\2\ Filing of a

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Form 5500 or Form 5500-SF, together with the required attachments and 
schedules in accordance with the instructions, by plan administrators, 
employers, and certain other entities also satisfies the annual filing 
and reporting requirements under Code sections 6057(b), 6058(a), and 
6059(a). Filing the Form 5500 Annual Return/Report will also satisfy an 
applicable plan administrator's annual reporting obligation under 
section 4065 of Title IV of ERISA.
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    \1\ Certain one-participant plans and foreign plans that are not 
subject to the requirements of section 104(a) of ERISA are required 
to file Form 5500-EZ, Annual Return of One Participant (Owners/
Partners and Their Spouses) Retirement Plan or a Foreign Plan. 
Beginning with 2020 forms filed on or after January 1, 2021, the 
Form 5500-EZ is required to be filed electronically through the same 
system as the Form 5500--the Form 5500 Electronic Filing Acceptance 
System (EFAST2). From 2009 to 2019, such plans had been permitted to 
file the Form 5500-SF electronically in lieu of filing the Form 
5500-EZ on paper with the IRS. See instructions for 2020 Form 5500-
EZ and Form 5500-SF.
    \2\ ERISA section 103 broadly sets out annual reporting 
requirements for employee benefit plans. The Form 5500 Annual 
Return/Report and the DOL's implementing regulations generally are 
promulgated under the ERISA provisions authorizing limited 
exemptions to these requirements and simplified reporting and 
disclosure for welfare plans under ERISA section 104(a)(3), 
simplified annual reports under ERISA section 104(a)(2)(A) for 
pension plans that cover fewer than 100 participants, and 
alternative methods of compliance for all pension plans under ERISA 
section 110. The forms, instructions, and related regulations are 
also promulgated under the DOL's general regulatory authority in 
ERISA sections 109 and 505.
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    The Form 5500 Annual Return/Report serves as the principal source 
of information and data available to the Agencies concerning the 
operations, funding, and investments of approximately 843,000 pension 
and welfare benefit plans that file.\3\ ERISA plans cover roughly 154 
million workers, retirees, and dependents of private sector pension and 
welfare plans \4\ with estimated assets of $12.2 trillion.\5\ 
Accordingly, the Form 5500 Annual Return/Report is essential to each 
Agency's enforcement, research, and policy formulation programs, as 
well for the regulated community, which makes increasing use of the 
information as more capabilities develop to interact with the data 
electronically. The data is also an important source of information and 
data for use by other federal agencies, Congress, and the private 
sector in assessing employee benefit, tax, and economic trends and 
policies. The Form 5500 Annual Return/Report also serves as a primary 
means by which the operations of plans can be monitored by 
participating employers in multiple employer plans and other group 
arrangements, plan participants and beneficiaries, and by the general 
public.
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    \3\ Estimates are based on 2019 Form 5500 filings. DOL notes 
that single employer welfare plans with under 100 participants that 
are unfunded or insured (generally don't hold assets in trust) are 
exempt from filing a Form 5500 under 29 CFR 2520.104-29. Therefore 
while DOL estimates there are 2.5 million health plans and 885,000 
non-health welfare plans, respectively, only 69,000 and 91,000 of 
these plans filed a 2019 Form 5500.
    \4\ Source: U.S. Department of Labor, EBSA calculations using 
the Auxiliary Data for the March 2019 Annual Social and Economic 
Supplement to the Current Population Survey.
    \5\ EBSA based these estimates on the 2018 Form 5500 filings 
with the U.S. Department of Labor (DOL), reported SIMPLE assets from 
the Investment Company Institute (ICI) Report: The U.S. Retirement 
Market, First Quarter 2021, and the Federal Reserve Board's 
Financial Accounts of the United States Z1 June 10, 2021.
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    The last time the Agencies implemented significant changes to the 
forms and schedules was for the 2009 form year, in conjunction with the 
move to mandatory electronic filing and a related update to the ERISA 
Filing Acceptance System (EFAST2).\6\ Those changes were proposed in 
2006, 71 FR 41615 (Jul. 21, 2006), and finalized in 2007, effective for 
the 2009 form series. 72 FR 64731 (Nov. 16, 2007). Other discrete 
changes that have been made to the Form 5500 Annual Return/Report over 
those years were generally set forth annually in the ``Changes to 
Note'' section in the instructions, some of which have involved 
targeted rulemaking activity to implement reporting changes required by 
law.\7\ The Agencies most recent significant initiative with respect to 
the Form 5500 was the publication of a proposal to modernize the forms 
and instructions in July 2016. 81 FR 47534 (July 16, 2016) (Tri-Agency 
Notice of Proposed Forms Revisions) and 81 FR 47496 (July 16, 2016) 
(DOL Notice of Proposed Rulemaking) (together the 2016 Modernization 
Proposal). The 2016 Modernization Proposal ultimately was not adopted 
as final changes to the forms, instructions, and regulations, although 
a small number of changes that were included in the 2016 proposal have 
been finalized, as set forth in the ``Changes to Note'' Section in the 
instructions to the Form 5500 Annual Return/Report for the years in 
which the changes were made.
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    \6\ EFAST2 is an all-electronic system that receives and 
displays Forms 5500 Series Annual Returns/Reports and Form PR Pooled 
Plan Provider Registrations. EFAST2 is operated by a private-sector 
government contractor on behalf of DOL, IRS, and PBGC.
    \7\ See, e.g., Revisions to Annual Return/Report-Multiple-
Employer Plans, Interim Final Rule, 79 FR 66617 (Nov. 10, 2014) 
(updating the Form 5500 instructions to require all multiple 
employer plans, including MEWAs, to provide a list of participating 
employers and certain financial information, as required by ERISA 
section 103(g)); Filings Required of Multiple Employer Welfare 
Arrangements and Certain Other Related Entities, Final Rule, 78 FR 
13781 (Mar. 1, 2013) (among other things, added new questions to 
Form 5500 for MEWAs that are required to complete the Form 5500 to 
provide information on their most recent Form M-1 (Report for 
Multiple Employer Welfare Arrangements (MEWAs) and Certain Entities 
Claiming Exception (ECEs) filing) (Form M-1).
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B. Recent Legislative Changes Supporting Proposed Annual Reporting 
Improvements

    The SECURE Act,\8\ which overall was designed to expand and 
preserve workers' retirement savings, is the most significant 
legislation impacting ERISA and Code provisions pertaining to 
retirement plans since the Pension Protection Act of 2006. Among other 
things, the SECURE Act directed the Secretary of Labor and the 
Secretary of Treasury (together ``Secretaries'') to develop a new 
aggregate annual reporting option for certain groups of retirement 
plans and included other statutory amendments that directly impact 
annual reporting requirements for multiple-employer pension plans 
(MEPs). In relevant part, the SECURE Act's expansion of MEPs and 
direction for the Secretaries to establish a consolidated reporting 
option for defined contribution pension plans that share certain key 
characteristics should help expand retirement coverage by making it 
easier for record keepers and other financial services providers to 
offer attractive retirement plan alternatives and for employers, 
especially small ones, to pick from among a broader array of 
alternatives what works best for them and their employees.
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    \8\ The SECURE Act was enacted December 20, 2019, as Division O 
of the Further Consolidated Appropriations Act, 2020 (Pub. L. 116-
94).
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    Section 202 of the SECURE Act provides that the Secretaries, shall, 
in cooperation, modify the Form 5500 Annual Return/Report so that all 
members of a group of defined contribution individual account plans 
described in section 202 may file a single aggregated annual return/
report satisfying the requirements of both section 6058 of the Code and 
section 104 of ERISA. The SECURE Act further provides that, in 
developing the consolidated return/report, the Secretaries may require 
any information regarding each plan in the group as such Secretaries 
determine is necessary or appropriate for the enforcement and 
administration of the Code and ERISA. The SECURE Act also mandates that 
the consolidated reporting by such a group must include such 
information as will enable participants in each of the plans to 
identify any aggregated return/report filed with respect to their plan. 
Section 202 provides that to constitute an eligible group of plans, all 
of the plans in the group must be either individual account plans or 
defined contribution plans as defined in section 3(34) of ERISA or in 
section 414(i) of the Code; must have the same trustee as described in 
section 403(a) of ERISA; the same one or more named fiduciaries as 
described in section 402(a) of ERISA; the same administrator as defined 
in section 3(16)(A) of ERISA and plan administrator as defined in 
section 414(g) of the Code; must have plan years beginning on the same 
date; and must provide the same investments or investment options to 
participants and beneficiaries. Section 202 further provides that a 
plan not subject to Title I of ERISA shall be treated as meeting these 
requirements for being eligible to be part of a consolidated reporting

[[Page 51490]]

group of plans, if the same person that performs each of the functions 
described in the above requirements, as applicable, for all other plans 
in such group performs each of such functions for such plan.\9\
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    \9\ SECURE Act Section 202(c).
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    Section 101 of the SECURE Act amended ERISA section 3(2) and added 
ERISA sections 3(43) and 3(44) to allow for a new type of ERISA-covered 
MEP--a defined contribution pension plan called a ``pooled employer 
plan'' operated by a ``pooled plan provider.'' Pooled employer plans 
allow multiple unrelated employers to participate without the need for 
any common interest among the participating employers (other than 
having adopted the plan).\10\ Under section 3(2) of ERISA, a pooled 
employer plan is treated for purposes of ERISA as a single plan that is 
a multiple employer plan. A pooled employer plan is defined in section 
3(43) as a plan that is an individual account plan established or 
maintained for the purpose of providing benefits to the employees of 
two or more employers; that is a qualified retirement plan or a plan 
funded entirely with individual retirement accounts (IRA plan); and the 
terms of which must meet certain requirements set forth in the 
statute.\11\ The term pooled employer plan does not include a 
multiemployer plan as defined in ERISA section 3(37) or a plan 
maintained by employers that have a common interest other than having 
adopted the plan.\12\ The term also does not include a plan established 
before the date the SECURE Act was enacted unless the plan 
administrator elects to have the plan treated as a pooled employer plan 
and the plan meets the ERISA requirements applicable to a pooled 
employer plan established on or after such date. The existence of this 
new type of multiple employer plan requires some adjustments to the 
Form 5500 to provide for annual reporting by such plans.\13\
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    \10\ DOL sought comments through a Request for Information 
published on July 31, 2019, on ``open'' MEP structures (those 
without the need for any commonality among the participating 
employers or other genuine organization relationship unrelated to 
participation in the plan) being treated as one multiple employer 
plan for purposes of compliance with ERISA. The DOL does not have 
any current plan to take further action regarding defined 
contribution open MEPs due to the SECURE Act provisions permitting 
pooled employer plans as a type of open MEP.
    \11\ 29 U.S.C 1002(43).
    \12\ In establishing a pooled employer plan as a new type of 
multiple employer plan, the SECURE Act in section 101(c) 
specifically referred to plans maintained by employers that have a 
common interest other than having adopted the plan. For example, the 
DOL's recent final association retirement plan regulation, at 29 CFR 
2510.3-55, published July 31, 2019, clarified and expanded the types 
of arrangements that could be treated as MEPs under Title I of ERISA 
to include plans established and maintained by a bona fide group or 
association of employers or by a professional employer organization 
(PEO). The SECURE Act provision excluding a ``plan maintained by 
employers that have a common interest'' from the definition of a 
pooled employer plan does not preclude employers with a common 
interest other than participating in the plan from establishing or 
participating in a pooled employer plan. Rather, it means that if a 
group of employers with a common interest other than participating 
in the plan establish a MEP, e.g., an association retirement plan 
under the DOL's regulation, the association retirement plan will not 
be subject to the SECURE Act requirements for a plan to be a pooled 
employer plan.
    \13\ New section 3(44) of ERISA establishes requirements for 
pooled plan providers, including a requirement to register with the 
DOL before beginning operations as a pooled plan provider. A 
parallel requirement to file a registration statement with the 
Secretary of Treasury is in section 413(e)(3)(A)(ii) of the Code. On 
November 16, 2020, the DOL published a notice of final rulemaking 
establishing the registration requirement for pooled plan providers. 
85 FR 72934 (Nov. 16, 2020). The Treasury Department and the IRS 
have advised that filing the Form PR with the DOL will satisfy the 
requirement to register with the Secretary of the Treasury. The 
instructions to the Form PR (Pooled Plan Provider Registration) 
(Form PR) advised registrants to use the same identifying 
information on the Forms 5500 Annual Return/Report filed by the 
pooled employer plans, particularly name; EIN for the pooled plan 
provider; any identified affiliates providing services; trustees; 
and plan name and number for each pooled employer plan. The Form PR 
and its instructions, as well as any Form PR that have been filed 
with the DOL by pooled plan providers, are available on the DOL 
website at www.efast.dol.gov.
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    Section 101 of the SECURE Act also amended ERISA section 103(g) for 
MEPs. Section 103(g) of ERISA requires that the annual return/report of 
a MEP generally must include a list of participating employers and a 
good faith estimate of the percentage of total contributions made by 
each participating employer during the plan year. The SECURE Act 
amended section 103(g) to expand the participating employer information 
that must be reported on the Form 5500 Annual Return/Report \14\ also 
to require the aggregate account balances attributable to each employer 
in the plan (determined as the sum of the account balances of the 
employees of each employer and the beneficiaries of such employees), 
and applied section 103(g) to retirement plans that currently meet the 
definition of a MEP under ERISA section 210(a), including any pooled 
employer plans, for plan years beginning on or after January 1, 
2021.\15\ With respect to a pooled employer plan, section 103(g) 
further requires that the annual return/report must include the 
identifying information for the person designated under the terms of 
the plan as the pooled plan provider.
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    \14\ SECURE Act Section 101(d).
    \15\ SECURE Act Section 101(e)(1).
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    In addition to various changes to the forms and instructions to 
address these statutory changes and reflect the existence of pooled 
employer plans and defined contribution plan reporting arrangements, 
some of the annual reporting changes being proposed are intended to 
ensure appropriate transparency and financial accountability for pooled 
employer plans, other MEPs, and defined contribution plan reporting 
arrangements. The rationales for some of those changes apply more 
broadly to retirement plans as a class (for example, improvements to 
the content and format for the financial schedules that retirement 
plans use to report information regarding their assets, investments, 
income, and expenses), and, accordingly, some of the changes are being 
proposed for retirement plans in general.

C. Overview of Proposed Changes to Forms, Schedules, and Instructions

1. General Proposed Changes
    The proposed revisions involve the following major categories of 
changes, along with other technical revisions and updates, to the 
current structure and content of the Form 5500 Annual Return/Report.
    <bullet> Update the Form 5500 and its instructions to establish 
requirements pursuant to section 202 of the SECURE Act for consolidated 
returns/reports for eligible defined contribution group (DCG) reporting 
arrangements as an alternative method of compliance for certain 
individual account or defined contribution retirement plans relying on 
the consolidated report to satisfy the generally applicable requirement 
that employee benefit plans file a Form 5500. This would include adding 
a new Schedule DCG (Individual Plan Information) to provide individual 
plan-level information for defined contribution pension plans covered 
by a DCG consolidated Form 5500 filing. It would also include adding a 
new checkbox on the Form 5500 (Part II, line 10a(4)) to indicate that 
Schedule DCG is attached to the Form 5500, with a space for the filer 
to enter the number of Schedules DCG (one per plan) attached to the 
Form 5500 filing.
    <bullet> Update the Form 5500 and its instructions to add a new 
Schedule MEP (Multiple Employer Pension Plan). MEPs would report 
information specific to MEPs, including the ERISA section 103(g) 
participating employer information, updated to add the new aggregate 
account information that is

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relevant only for pension plans, on the Schedule MEP. Questions 
intended to satisfy the SECURE Act's reporting requirements for pooled 
employer plans and questions to link the Form PR (Pooled Employer 
Registration) and the Form 5500 for each plan operated by a pooled plan 
provider would also be on the Schedule MEP. A new checkbox would be 
added to the Form 5500 (Part II, line 10a(5) to indicate that Schedule 
MEP is attached to the Form 5500.
    <bullet> Transfer the participating employer information from the 
Form 5500 Annual Return/Report to the Form M-1 for all multiple 
employer welfare arrangements (MEWAs)) (plan and non-plan MEWAs)) that 
offer or provide coverage for medical benefits, and continue to require 
reporting of participating employer information on the Form 5500 Annual 
Return/Report for plan MEWAs that provide other benefits.\16\
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    \16\ The Agencies may choose as part of a final rule to have 
those plan MEWAs that are not required to file the Form M-1 complete 
the relevant participating employer information on the Schedule MEP 
rather than continuing to complete as an attachment to the Form 
5500. The agencies invite comment on any preference from a 
disclosure, forms preparation, or data usage perspective as to how 
the information is collected.
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    <bullet> Update Schedule H and instructions to standardize the 
schedules of investment assets required to be included in the annual 
return/report (Schedule H, line 4i Schedules), so that the information 
can be entered or imported for improved electronic use and 
transparency.
    <bullet> Update the Form 5500 and 5500-SF and their instructions on 
counting participants to change the current threshold for determining 
when a defined contribution plan may file as a small plan, including 
eligibility for the waiver of the requirement for small plans to have 
an audit and include the report of an independent qualified public 
accountant (IQPA) with their annual report. Specifically, instead of 
using all those eligible to participate, filers generally would look at 
the number of participants/beneficiaries with account balances as of 
the beginning of the plan year (the first plan year would use an end of 
year measure). This proposed change would be reflected in a new line 
item on the Form 5500 and Form 5500-SF.\17\
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    \17\ This change was proposed partly in light of section 112 of 
the SECURE Act, which provides that long-term, part-time workers 
that have reached specified minimum age requirements and worked at 
least 500 hours in each of three consecutive 12-month periods must 
be permitted to make elective contributions to a Code section 401(k) 
qualified cash or deferred arrangement for plan years beginning on 
or after January 1, 2024. This could add to the number of 
participants who are eligible to, but who elect not to participate 
in a plan, which could impact whether a plan needs to file as a 
large plan. The DOL expects that excluding from the participant 
count those participants who are eligible to participate but did not 
have an account balance will reduce expenses for small employers to 
establish and maintain a small retirement plan, and as a 
consequence, encourage more employers to offer workplace-based 
retirement savings plans to their employees.
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    <bullet> Add trust questions to the Form 5500, the Form 5500-SF, 
and the IRS Form 5500-EZ, regarding the name of the plan's trust, the 
trust's EIN, the name of the trustee or custodian, and the trustee's or 
custodian's telephone number. This information will enable the Agencies 
to more efficiently focus on compliance concerns for retirement plan 
trusts, including those for pooled employer plans and DCG reporting 
arrangements.
    <bullet> Revise the 2021 5500 Annual Return/Report instructions to 
provide an interim method of reporting participating employer 
information for MEPs and pooled plan provider identification 
information for pooled employer plans pending the Schedule MEP 
implementation for 2022 plan year filings.
    Section 101 of the SECURE Act also amended ERISA section 
104(a)(2)(A) to permit the Secretary of Labor to prescribe by 
regulation simplified reporting for MEPs subject to ERISA section 
210(a) with fewer than 1,000 participants in total, as long as each 
participating employer has fewer than 100 participants. The DOL is not, 
however, currently proposing to amend the current reporting rules to 
establish a ``simplified report'' for such plans. The DOL is interested 
in stakeholder comments on why MEPs subject to ERISA section 210(a) 
should be subject to different reporting requirements than single 
employer plans that cover fewer than 1,000 participants, and on 
appropriate conditions and limitations for such a simplified report 
that would ensure transparency and financial accountability comparable 
to that for other large retirement plans.
2. Internal Revenue Code-Based Questions for the 2022 Form 5500s
    To better identify non-compliant plans, the IRS is proposing the 
following changes to the 2022 forms, schedules, and instructions, 
including adding the proposed Schedule DCG, so that certain questions 
are answered at the individual plan level (not the DCG level) in order 
for a plan's annual reporting obligation to be satisfied by a DCG Form 
5500 filing:
    <bullet> Add a nondiscrimination and coverage test question to Form 
5500, Form 5500-SF, and proposed Schedule DCG that was on the Schedule 
T before it was eliminated. The question asks if the employer 
aggregated plans in testing whether the plan satisfied the 
nondiscrimination and coverage tests of Code sections 401(a)(4) and 
410(b).
    <bullet> Add a question to Form 5500, Form 5500-SF, and proposed 
Schedule DCG, for section 401(k) plans, asking whether, if applicable, 
the plan sponsor used the design-based safe harbor rules or the ``prior 
year'' or ``current year'' ADP test.
    <bullet> Add a question to Form 5500, Form 5500-SF,\18\ and 
proposed Schedule DCG asking whether the employer is an adopter of a 
pre-approved plan that received a favorable IRS Opinion Letter, the 
date of the favorable Opinion Letter, and the Opinion Letter serial 
number.
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    \18\ IRS will separately make a parallel update to the Form 
5500-EZ, which is solely in the jurisdiction of the IRS.
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3. Defined Benefit Plan/Title IV Questions for the 2022 Form 5500s
    The proposal includes certain changes designed to improve reporting 
by defined benefit plans subject to Title IV of ERISA. The proposed 
changes would:
    <bullet> Modify Schedule MB, line 3 instructions to require an 
attachment that breaks down the total withdrawal liability amounts by 
date, separately specifying the periodic withdrawal liability amounts 
and lump sum withdrawal liability amounts.
    <bullet> Modify Schedule MB by adding a new requirement for plans 
that assess withdrawal liability to an employer during the plan year, 
to report the interest rate used to determine the present value of 
vested benefits for withdrawal liability determinations. This 
information would be reported in a renumbered new line, 6f.
    <bullet> Modify Schedule MB for the questions related to the line 6 
``expense load'' to better align with the various ways multiemployer 
plans incorporate expense loads into their calculations.
    <bullet> Modify Schedule MB, line 8 by requiring additional 
information about demographics, benefits and contributions for plans 
with 500 or more total participants on the valuation date. Certain 
PBGC-insured single-employer plans would be required to report the some 
additional information as well.
    <bullet> Modify Schedule MB by changing the ``age/service'' scatter 
attachment which is currently required for PBGC-insured multiemployer 
plans with active participants, regardless of the number of 
participants.
    <bullet> Modify Schedule MB by clarifying the line 4f instructions 
and Schedule language concerning when or if plans in critical status or 
critical and declining

[[Page 51492]]

status are projected to emerge or become insolvent.
    <bullet> Make the Schedule SB, line 26 reporting requirements about 
demographics and benefits similar to the requirements for PBGC-insured 
multiemployer plans.
    <bullet> Modify Schedule SB's Part IX, line 41 because the 
previously required information related to elective funding relief 
under the Pension Relief Act of 2010 is no longer relevant, and in its 
place, require information about the elective funding relief under the 
American Rescue Plan Act of 2021.
    <bullet> Modify Schedule R's Part V, line 13 requirement that 
multiemployer defined benefit pension plans subject to minimum funding 
standards report identifying information about any participating 
employer whose contributions to the plan account for more than five (5) 
percent of the total contributions for the year to require that the ten 
employers who contributed the largest amounts be reported, even if that 
employer's contribution accounted for less than five (5) percent of the 
total.
    <bullet> Modify the instructions to permit (but not require) 
certain attachments to Schedule MB and SB to be provided in a tabular 
format (spreadsheet) rather than PDF or TXT formats.

D. Appendices

    The Agencies have included the following appendices to provide more 
detailed illustrations and explanations of the proposed changes: (1) 
Appendix A--a facsimile of proposed Schedule MEP (Multiple Employer 
Pension Plan) and its instructions; (2) Appendix B--a facsimile of 
proposed Schedule DCG (Individual Plan Information) and its 
instructions; (3) Appendix C--a detailed description of proposed 
changes to the 2021 Form 5500, the Form 5500-SF, and their 
instructions; (4) Appendix D--a detailed description of proposed 
changes to the 2022 Form M-1 and its instructions; (5) Appendix E--a 
detailed description of proposed changes to the 2022 Form 5500, Form 
5500-SF, applicable schedules, and their instructions.\19\
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    \19\ The appendices include mock-ups of certain forms or parts 
of forms that are intended to be illustrative and facilitate 
stakeholders' ability to comment on the proposed changes. This 
approach of showing proposed changes will reduce costs associated 
with publication of the proposed form changes in the Federal 
Register and provide greater flexibility for the related EFAST2 
development processes. The Agencies intend to publish mock-ups of 
the forms on the DOL's website as part of the EFAST third party 
software developer certification process and in furtherance of 
public education efforts about the changes to be implemented.
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    Certain amendments to the annual reporting regulations are 
necessary to accommodate some of the proposed revisions to the forms. 
The DOL is publishing separately today in the Federal Register proposed 
amendments to the DOL's annual reporting regulations. That document 
includes a discussion of the findings required under sections 104 and 
110 of ERISA that are necessary for the DOL to adopt the Form 5500 
Annual Return/Report, including the Form 5500-SF, if revised as 
proposed herein, as an alternative method of compliance, limited 
exemption, and/or simplified report under the reporting and disclosure 
requirements of Part 1 of Subtitle B of Title I of ERISA.

II. Request for Comments

    The Agencies invite comments from interested persons on all facets 
of the proposed forms and instruction changes. Comments should be 
submitted in accordance with the instructions at the beginning of this 
document. Commenters are asked to take into account the costs and 
burdens to plans, participants and beneficiaries, plan fiduciaries, 
plan service providers, and other affected parties, in commenting on 
the proposed annual reporting changes, including any suggested 
alternatives.
    As noted above, the DOL also is publishing elsewhere in today's 
Federal Register a Notice of Proposed Rulemaking with proposed 
amendments to the reporting and disclosure regulations at Part 2520 of 
Chapter XXV of Title 29 of the Code of Federal Regulations to implement 
certain proposed Form 5500 Annual Return/Report changes under Title I 
of ERISA. To avoid unnecessary duplication of effort, public comments 
submitted in response to this Notice of Proposed Forms Revisions will 
be treated as public comments on the Notice of Proposed Rulemaking to 
the extent they include information relevant to the proposed regulatory 
amendments.
    The DOL components of this proposal are generally focused on 
implementing annual reporting changes related to the SECURE Act and 
MEPs and a limited number of other supporting proposed changes intended 
to ensure the Form 5500 serves as an appropriate transparency and 
financial accountability tool for retirement plans, including pooled 
employer plans and MEPs. The DOL has added a separate project to its 
semi-annual regulatory agenda that would focus on a broader range of 
improvements to the Form 5500 annual reporting requirements. The 
regulatory action is part of a strategic project with the IRS and PBGC 
to improve the Form 5500 Annual Return/Report. Modernizing the 
financial and other annual reporting requirements on the Form 5500, 
continuing to make the investment and other information on the Form 
5500 more data mineable, and potential changes to group health plan 
annual reporting requirements are part of that evaluation. The project 
is also focused on enhancing the agencies' ability to collect employee 
benefit plan data that best meets the needs of changing compliance 
projects, programs, and activities. See www.reginfo.gov for more 
information. Public comments on such broader improvements to the Title 
I components of the Form 5500 are beyond the intended scope of this 
rulemaking.

III. Discussion of Proposed Changes

A. SECURE Act Section 202 Defined Contribution Group (DCG) Reporting 
Arrangements

    Section 202 of the SECURE Act directs the Secretaries to modify the 
Form 5500 to allow certain groups of defined contribution pension plans 
to file a single consolidated annual return/report. For a group of 
plans to be able to file a consolidated return/report, the SECURE Act 
provides that all of the plans must be either individual account plans 
or defined contribution pension plans that have the same trustee; the 
same one or more named fiduciaries; the same plan administrator under 
ERISA and the Code; the same plan year; and provide the same 
investments or investment options for participants and beneficiaries.
    The SECURE Act also provides that in developing the consolidated 
return or report for such arrangements, the Secretaries shall require 
such information as will enable a participant in a plan to identify any 
consolidated return or report filed with respect to the plan, and may 
require such return or report to include any information regarding each 
plan in the group as each Secretary determines is necessary or 
appropriate for the enforcement and administration of the provisions of 
ERISA and the Code.
    Pursuant to Section 202 of the SECURE Act directing the Secretaries 
to modify the Form 5500 to allow certain groups of defined contribution 
pension plans to file a single consolidated annual return/report, the 
DOL and the IRS (the ``Departments'') have determined that an efficient 
and effective approach to establishing such a consolidated return/
report option would be to amend the Form 5500 and its related 
instructions to provide that the filing requirements for large pension 
plans and direct filing entities (DFEs)

[[Page 51493]]

would generally apply to this new type of DFE--a defined contribution 
group (DCG) reporting arrangement, except that an additional schedule 
to report individual plan level information--the proposed Schedule DCG, 
would have to be attached for each plan included in the DCG filing.\20\ 
Consistent with section 202(b) of the SECURE Act, as discussed in more 
detail below, the Departments are proposing to obtain for each plan in 
the DCG the additional information requested on a new proposed Schedule 
DCG, and are proposing certain other key conditions for DCG reporting 
arrangements that are intended to ensure appropriate transparency and 
financial accountability. Specifically, under the proposal: (1) The DCG 
would file a Form 5500 under rules and conditions that apply generally 
to large defined contribution pension plans; (2) each of the plans 
participating in the DCG would need to meet certain conditions as 
discussed in more detail below, including that the participating plan 
must not hold any employer securities, be 100% invested in certain 
secure, easy to value assets that meet the definition of ``eligible 
plan assets'' and be audited by an IQPA or be eligible for the waiver 
of the annual examination and report of an IQPA under 29 CFR 2520.104-
46, but not by reason of enhanced bonding; (3) the DCG's Form 5500 
would have to provide the plan level information reported on the 
proposed Schedule DCG regarding the covered plans, including an IQPA 
audit report for each participating large plan; and (4) the investment 
assets of the plans participating in the DCG would have to be held in a 
single trust of the DCG reporting arrangement and the consolidated Form 
5500 filed by the DCG would include an audit of the DCG's trust 
financial statements.
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    \20\ The proposed new regulation that would be at 29 CFR 
2520.104a-9 published in the parallel NPRM provides that, as would 
be the case for all of the participating plans in the DCG reporting 
arrangement if they were filing individually, the aggregated Form 
5500 for the DCG is due no later than the end of the 7th month after 
the end of the common plan year that all the plans must have in 
order to participate in a DCG reporting arrangement pursuant to the 
requirement in section 202 of the SECURE Act and the proposed 
regulation that would be at 29 CFR 2520.104-51. Because the DCG 
filing is an alternative to each participating plan filing its own 
Form 5500, that would mean that each plan would have to submit its 
own IRS Form 5558 to extend the plan's due date, and, as a 
consequence, extend the due date for the DCG filing. A plan that did 
not submit a timely Form 5558 and that participated in a DCG filing 
that was submitted after the 7th month normal due date would be 
treated as having filed late. Public comments are specifically 
solicited on how the filing extension process should be structured 
for DCGs, including whether DCG reporting arrangements should be 
able to file a single Form 5558 to obtain an extension for filing 
the DCG consolidated report on behalf of the participating plans as 
an alternative to having each individual plan file a Form 5558 for 
there to be an extension for the reporting group as a whole. The 
Departments note that under the somewhat similar consolidated 
reporting provisions applicable to GIAs, the GIA is permitted to use 
the Form 5558 to apply for an extension of time the GIA consolidated 
report on behalf of the plans participating in the GIA.
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    An important aspect of the audit of the DCG trust would be that, in 
the DOL's view, the versions of the separate schedules referenced in 
ERISA section 103(a)(3)(A) and 29 CFR 2520.103-10(b) and proposed 
2520.103-14(b) that would be filed as part of the DCG consolidated Form 
5500 would be treated as ERISA section 103(b)(3) supplemental schedules 
for purposes of the required IQPA's opinion on whether those schedules 
are presented in conformity with DOL rules and regulations, including 
the delinquent participant contributions schedule filed by the DCG in 
connection with line 4a of its Form 5500, Schedule H. The DOL views 
these conditions as providing important financial accountability and 
oversight protections while also allowing DCGs to offer annual 
reporting cost-efficiencies, particularly for the small plans that we 
believe SECURE Act section 202 was intended to benefit, that are 
comparable to those that can be offered by MEPs, including pooled 
employer plans.
    The DOL is also publishing a separate Notice of Proposed Rulemaking 
that includes a proposal to add new regulations at 29 CFR 2520.103-14 
and 2520.104-51 pursuant to section 110 of ERISA that would set forth 
this DCG option as an alternative method of compliance for eligible 
plans with the generally applicable requirement to file their own 
separate Form 5500.
1. General Section 202 Conditions Applicable to Covered Plans
    The Departments' review of the conditions in section 202 of the 
SECURE Act suggests that it was primarily aimed at plans of unrelated 
small businesses that adopt a plan that has received approval from the 
IRS as to its form through the IRS Pre-Approved Program (pre-approved 
plan) offered by the same provider, and that section 202 was intended 
to provide this type of business structure with annual reporting cost 
efficiencies similar to those that MEPs and pooled employer plans can 
offer to their participating employers. Accordingly the conditions and 
reporting requirements in this proposal focus on such arrangements. The 
Departments solicit public comments on whether the final rule should 
include other or different conditions for DCG reporting arrangements.
    Under the proposed Form 5500 form changes and the DOL's related 
proposed regulation, and pursuant to the terms of section 202 of the 
SECURE Act, all of the plans relying on the DCG consolidated return/
report must be individual account plans or defined contribution pension 
plans that have the same trustee and trust(s); the same one or more 
named fiduciaries; the same plan administrator under ERISA and the 
Code; the same plan year; and provide the same investments or 
investment options for participants and beneficiaries. The Departments 
are providing the following explanations of some aspects of and 
limitations related to those conditions that are part of the proposal.
    With respect to the same trustee requirement, section 403(a) of 
ERISA provides that, except as provided in ERISA section 403(b), all 
assets of an employee benefit plan shall be held in trust by one or 
more trustees. The criteria set forth in ERISA section 403(b) apply to 
the DCG trustee under the proposal, except, pursuant to the SECURE Act 
provision there must be only one trustee for all the plans 
participating in a DCG reporting arrangement. The common trustee must 
be either named in the trust instrument or in the plan instrument or 
appointed by a person who is a named fiduciary of the participating 
plan, and upon acceptance of being named or appointed, the trustee 
shall have exclusive authority and discretion to manage and control the 
assets of the plan, except to the extent that the plan expressly 
provides that the trustee is subject to the direction of a named 
fiduciary who is not a trustee (in which case the trustees shall be 
subject to proper directions of such fiduciary which are made in 
accordance with the terms of the plan and which are not contrary to 
ERISA), or authority to manage, acquire, or dispose of assets of the 
plan is delegated to one or more investment managers pursuant to 
section 402(c)(3) of ERISA.
    The Departments note that, historically, the IRS conditions 
applicable to many pre-approved plans required that employers who used 
what was known as a ``master'' plan were required to use the same trust 
or custodial account, whereas each employer had a separate trust or 
custodial account in a ``prototype plan.'' \21\ Under the proposal, the 
``same trust'' requirement for the consolidated report would be 
satisfied by the same trust structure historically used by

[[Page 51494]]

employers using ``master'' plans. Use of sub-trusts of the DCG trust 
would be permitted, but the proposal would not cover arrangements that 
allow separate plans to have a separate trust for investments. As 
discussed in more detail below, part of the reason for this provision 
stems from considerations related to the establishment of audit 
requirements for DCG reporting arrangements and the otherwise generally 
applicable requirement under Title I of ERISA for plans that cover 100 
or more participants file with their Form 5500 an audit report of an 
independent qualified public accountant (IQPA) and the application of 
Generally Accepted Auditing Standards or GAAS (which ERISA section 103 
applies to employee benefit plan audits).
---------------------------------------------------------------------------

    \21\ See www.irs.gov/retirement-plans/types-of-pre-approved-retirement-plans.
---------------------------------------------------------------------------

    Although, as described above, section 202 of the SECURE Act 
includes a requirement that the eligible plans must have the same 
``trustee'' as described in section 403(a) of ERISA, the Departments 
note that it is commonplace for ERISA covered plans to use insurance 
(e.g., individual account plans using variable annuity structures and 
Code section 403(b)(1) plans) and custodial accounts (e.g., Code 
section 403(b)(7) plans) as funding vehicles. ERISA section 403(b) 
includes explicit exceptions to the trust requirement for such plan 
designs. There is no legislative history for SECURE Act section 202 
discussing why the provision was limited to plans with ``trustees,'' 
and the Departments do not believe that the SECURE Act section 202 
requirement for a ``trustee'' can be read to include plans without 
trustees funded by insurance or custodial accounts pursuant to the 
trust exceptions in ERISA section 403(b). Nonetheless, the Departments 
specifically solicit comments on whether they should, pursuant to their 
general regulatory authority, provide a consolidated reporting option 
for plans that use the same custodial account or insurance policy as 
the funding vehicle for their plans, and if so, whether special 
conditions should apply in light of the absence of a trustee or 
trustees.
    With respect to the ``same one or more named fiduciaries 
requirement,'' ERISA section 402 provides that every employee benefit 
plan shall be established and maintained pursuant to a written 
instrument. Such instrument shall provide for one or more named 
fiduciaries who jointly or severally have authority to control and 
manage the operation and administration of the plan. Section 402 of 
ERISA further provides that the term ``named fiduciary'' means a 
fiduciary who is named in the plan instrument, or who, pursuant to a 
procedure specified in the plan, is identified as a fiduciary (A) by a 
person who is an employer or employee organization with respect to the 
plan or (B) by such an employer and such an employee organization 
acting jointly. The Departments understand that it is customary for the 
employer/plan sponsor to be a named fiduciary of the employer's plan. 
The Departments do not believe the SECURE Act intended that each 
employer in a group of plans be a named fiduciary of every plan in the 
group. Accordingly, the proposal would allow for the employer/plan 
sponsor to be a named fiduciary of each employer's own plan, provided 
that the other named fiduciaries under the plans are the same and 
common to all plans.
    The SECURE Act further requires that all the plans have the same 
administrator as defined in section 3(16)(A) of ERISA and plan 
administrator as defined in section 414(g) of the Code. Under the 
proposal, the plans must designate the same person (which could be an 
entity or organization) as the administrator. In general, under ERISA 
and the Code the ``plan administrator'' or ``administrator'' is the 
person specifically so designated by the terms of the instrument under 
which the plan is operated. If an administrator is not so designated, 
the plan administrator is the plan sponsor, as defined in section 
3(16)(B) of ERISA. The Departments do not believe that the default 
``plan sponsor'' provision is workable in this context, and, 
accordingly, the proposal requires that there be a designated common 
plan administrator and that the administrator be the same for all the 
plans relying on the DCG consolidated Form 5500.
    The proposal also requires that all the plans provide the same 
investments or investment options to participants and beneficiaries to 
be able to rely on the DCG consolidated Form 5500 as satisfying their 
annual reporting obligation. In the Departments' view, this requirement 
in part was intended to allow for appropriate transparency in the 
consolidated financial information that would be filed by the DCG. To 
the extent the covered plans had different investments or investment 
options, much more detailed financial reporting would be needed to 
provide appropriate oversight and accountability. The Departments also 
believe that, even absent the proposed ``eligible plan assets condition 
for DCGs,'' the SECURE Act's ``same investments or investment options'' 
requirement effectively precludes plans that hold employer securities 
from participating in a DCG reporting arrangement as well as precluding 
treatment of brokerage windows as an ``investment option'' because such 
investments and investment alternatives would conflict with the 
investment uniformity objectives of the SECURE Act requirement. The 
Departments, however, specifically solicit comments on whether the 
final rule should allow employer securities as an exception to the 
``same investments or investment options'' requirement. The Departments 
also solicit comments on whether the final rule should allow brokerage 
windows, self-directed brokerage accounts, and similar features in 
plans participating in DCG arrangements, and, if so, what reporting 
requirements should be applied, e.g., what information should be 
collected regarding the brokerage windows/accounts, the participants 
using the brokerage windows/accounts, and the individual assets held by 
the plans as a result of investments made through brokerage windows/
accounts.
    Section 202 further provides that a plan not subject to Title I of 
ERISA can be part of a DCG reporting arrangement if the non-Title I 
plan and all other plans in the reporting group have the same persons 
acting as the trustee as defined in ERISA section 403(a), the named 
fiduciaries as described in ERISA section 402(a), the administrator as 
defined in ERISA section 3(16)(A), and the plan administrator as 
defined in Code section 414(g), as applicable. In the Departments' 
view, this provision was directed at so-called ``one-participant'' 
plans required to file the IRS Form 5500-EZ. IRS views the current Form 
5500-EZ as providing plan sponsors with a simple and streamlined means 
to satisfy the annual reporting requirement under section 6058 of the 
Code. The information being requested on the Schedule DCG for a DCG is 
almost identical to the information already provided on the Form 5500-
EZ, so that the group filing arrangement would not effectively reduce 
the information a Form 5500-EZ filer would need to provide to IRS in a 
separate filing. Additionally, the plan administrator will need to file 
a consolidated Form 5500 (with any required schedules) for the DCG that 
provides aggregate information for all Form 5500-EZ filers. Presumably, 
the DCG will require a Form 5500-EZ filer to provide at least as much 
information as would be required to file an individual Form 5500-EZ. 
Finally, IRS might incur significant costs and use significant 
resources if it were to develop a separate group filing arrangement for 
Form 5500-EZ filers.

[[Page 51495]]

Before incurring these costs and using these resources, IRS requests 
comments from interested parties on whether Form 5500-EZ filers are 
expected to be interested in participating in a DCG structure, 
including a separate DCG structure only for Form 5500-EZ filers, in 
light of the lack of burden reduction that a Form 5500-EZ filer would 
experience by participating in a DCG structure. With respect to the 
latter, the Departments request comments on the feasibility of 
including both ERISA and non-ERISA filers in a single DCG filing, 
including with respect to the application of the audit requirements 
under Title I.
2. Conditions for Plans To Participate in a DCG Reporting Arrangement
    To be eligible to rely on the proposed alternative method of 
compliance, the employee benefit plan (1) must have all of its 
investment assets held in a single trust of the DCG reporting 
arrangement; (2) the plan must not hold any employer securities at any 
time during the plan year; (3) at all times during the plan year, the 
plan must be 100% invested in certain secure, easy to value assets that 
meet the definition of ``eligible plan assets'' (see the instructions 
for line 6a of the Form 5500-SF), such as mutual fund shares, 
investment contracts with insurance companies and banks valued at least 
annually, publicly traded securities held by a registered broker 
dealer, cash and cash equivalents, and plan loans to participants; (4) 
the plan must be audited by an IQPA or be eligible for the waiver of 
the annual examination and report of an IQPA under 29 CFR 2520.104-46, 
but not by reason of enhanced bonding (see instructions for line 6b of 
the Form 5500-SF); and (5) multiemployer plans and MEPs (including 
pooled employer plans and professional employer organizations (PEOs)) 
cannot participate in DCG reporting arrangements.
    An important aspect of the audit of the DCG trust would be that, in 
the DOL's view, the versions of the separate schedules referenced in 
ERISA section 103(a)(3)(A) and 29 CFR 2520.103-10(b) and 2520.103-2(b) 
that would be filed as part of the DCG consolidated Form 5500 would be 
treated as ERISA section 103(b)(3) supplemental schedules for purposes 
of the required IQPA's opinion on whether those schedules are presented 
in conformity with DOL rules and regulations, including the delinquent 
participant contributions schedule filed by the DCG in connection with 
line 4a of its Form 5500, Schedule H. The DOL views these conditions as 
providing important financial accountability and oversight protections 
while also allowing DCGs to offer annual reporting cost-efficiencies, 
particularly for the small plans that we believe SECURE Act section 202 
was intended to benefit, that are comparable to those that can be 
offered by MEPs, including pooled employer plans.
    With respect to the audit requirement for large plans participating 
in a DCG, the DOL understands that under GAAS, it would not be possible 
to have a consolidated audit of all the participating plans in the DCG 
reporting arrangement. Rather, under GAAS, each large plan in the DCG 
reporting arrangement would have to be subject to its own separate 
audit. By comparison it would be possible, under GAAS, for a DCG 
reporting arrangement to be subjected to a single audit if it used a 
single trust for all of the plans covered by the DCG report. Such a 
``single trust'' audit, however, would cover only the trust's financial 
statements and would not cover aspects of plan operations and finances 
that would be covered by a GAAS audit at the plan level. The DOL views 
an IQPA audit as an important financial transparency and accountability 
condition for DCG reporting arrangements. Generally, pension plans and 
funded welfare plans with 100 or more participants are required to have 
an audit of the plan's financial statements performed by an IQPA. Under 
Statement on Auditing Standards No. 136 (SAS 136), Forming an Opinion 
and Reporting on Financial Statements of Employee Benefit Plans Subject 
to ERISA, independent qualified public accountants are required to 
consider relevant plan provisions that affect the risk of material 
misstatement for various transactions, account balances, and related 
disclosures. Areas such as participant eligibility, plan contributions, 
benefit payments and participant loans are all covered as part of a 
plan level audit. Additionally, auditors are required to communicate 
reportable findings to the plan that are identified during the audit of 
the plan. For example, it has been the DOL's experience that plan 
audits lead to increased reporting of prohibited transactions, such as 
identifying and disclosing delinquent participant contributions.
    An audit of a trust, such as a DCG trust, does not have similar 
requirements. In a trust audit, the line items on the trust's financial 
statement are audited, but because the underlying participating plans 
themselves are not audited, compliance with the provisions of the plans 
that are invested in and funded by the trust are not audited. 
Therefore, in a trust audit, the amount of contributions received by 
the trust might be tested against the contributions remitted by 
participating plans, but, whether those contributions amounts remitted 
are in accordance with the individual plan provisions would not be 
tested, as they would be tested in an audit of the plan. There could be 
undisclosed, material errors in the amount of contributions remitted to 
the trust versus what should have been remitted. Similarly, in a trust 
audit, the benefit payments to participants might be tested in terms of 
amounts paid and whether they were authorized, but whether those were 
in compliance with plan provisions, such as vesting provisions, would 
not be tested as they would be tested in a plan's audit. In a plan 
audit, participant data is tested. Participant data testing involves 
determining whether employees are properly included or excluded from 
participating and whether the census data upon which eligibility for 
certain contributions and distributions are made is accurate. The audit 
of a trust would not test this at all. Finally, the materiality 
threshold for a trust audit could be significantly higher than that 
which would apply in the case of an individual participating plan 
because the trust threshold would be based on total assets in the trust 
rather than assets in each individual plan. After carefully considering 
these issues, the Departments decided to propose that a large plan that 
elects to participate in a DCG must continue to be subject to an IQPA 
audit and that the audit report for the plan would have to be filed 
with the consolidated Form 5500 of the DCG reporting arrangement.
    The DOL acknowledges that at least some of these considerations 
could be applied to small plans participating in the DGC arrangement. 
While the DOL did not believe it would be appropriate to relieve from 
the IQPA audit requirement those large plans currently subject to the 
audit, it also did not believe that it would be appropriate to require 
small plans that are not currently required to have an IQPA audit to 
have such an audit as a condition of participating in a DCG reporting 
arrangement. Rather, in light of the fact that DCG reporting 
arrangements would be consolidating the assets of many unaffiliated 
small plans under the control of a single trustee in a single trust, 
and the DOL's understanding that such a trust could be subject to a 
single GAAS audit, the DOL is proposing that the DCG trust be audited 
by an IQPA as a way of adding protections for funds aggregated in the 
DCG trust. The DOL notes that this structure has some parallels to the

[[Page 51496]]

current reporting alternative for group insurance arrangements (GIAs) 
under 29 CFR 2520.103-2, another type of DFE that files the Form 5500 
Annual Return/Report on behalf of participating welfare benefit plans. 
The need for more information for DCGs than for GIAs is due to the 
difference between retirement and welfare plans, including the 
respective requirements under the Code, and also due to the fact that 
GIAs must provide welfare benefits fully through insurance.
    DOL further acknowledges that, under the proposal, for plans to be 
able to satisfy their annual reporting obligation by relying on the 
Form 5500 filing by a DCG reporting arrangement, the plans would have 
to be 100% invested in eligible plan assets as defined in the Form 
5500-SF instructions.
    Accordingly, plan assets in the DCG trust would, by definition, be 
held by regulated financial institutions, including banks or similar 
financial institutions and insurance companies, and may qualify for 
limited scope audit treatment in accordance with ERISA section 
103(a)(3)(C). Thus, even for large plans, the investment assets 
certified by those financial institutions/insurance companies would not 
be audited, and the auditor would not be performing valuation work on 
the assets covered by the bank or insurance company certifications. 
Although that may diminish some aspects of the IQPA requirement for 
large plans in DCG reporting arrangements, the DOL did not believe that 
it would be appropriate to propose that large plans be precluded from 
participating in a DCG unless the plan disclaimed reliance on the 
limited scope audit provisions in ERISA section 103(a)(3)(C) and had a 
full scope audit performed.
    The DOL further expects that, because all of the investments held 
in the DCG's single trust would be the subject of the DCG audit, it is 
likely that to reduce expenses the DCG reporting arrangement and the 
participating large plans would engage the same auditor to perform the 
audits of the DCG trust and any individual large plans participating in 
the DCG reporting arrangement. Alternatively, to the extent the 
individual plans engage different auditors, the DOL expects that the 
use of reports issued under Statement on Standards for Attestation 
Engagements No. 16 (SSAE 16) may permit the individual plan auditors to 
use those reports for the DCG trust to reduce their own audit work on 
the trust as part of the individual plan audit. The same rules for 
determining whether an individual plan is required to file as a large 
plan would apply to the plans within a DCG, including the ``80 to 120'' 
transition rule at 29 CFR 2520.103-1(d). Similarly, if finalized, the 
proposed change on using participants with account balances, rather 
than all eligible participants, to determine small plan status for 
general annual reporting purposes also would apply.
    With respect to the condition prohibiting multiemployer plans and 
MEPs from being part of DCG reporting arrangements, the Departments do 
not believe that section 202 of the SECURE Act was focused on allowing 
groups of multiemployer plans or MEPs, which already file a single Form 
5500 that covers all of the employers that participate in the plan, to 
file a single consolidated Form 5500 covering the group of 
multiemployer plans or MEPs. The Departments are also concerned that 
allowing a single consolidated Form 5500 in the case of such plans, for 
example, a group of multiemployer section 401(k) plans, could result in 
an undesirable reduction in transparency and financial accountability. 
Further, creating a consolidated report for such groups of plans would 
likely be much more complicated and costly than what is being proposed 
in this document. Nonetheless, the Departments acknowledge that such a 
limitation is not expressly set forth in section 202 of the SECURE Act, 
and, accordingly, solicits public comments on whether the final rule 
should include multiemployer plans and MEPs, and if so, what conditions 
should apply to DCG reporting arrangements that would include such 
plans.
3. Content Requirements for DCG Form 5500
    The proposal also sets forth the content requirements for the 
consolidated Form 5500 return/report filed by the DCG reporting 
arrangement. Under the proposal, DCGs would not be permitted to file a 
Form 5500-SF. Rather, DCG reporting arrangements would be required to 
file a Form 5500 Annual Return/Report that includes largely the same 
information that large pension plans and other DFEs are generally 
required to file, except that a DCG reporting arrangement would also be 
required to include in its annual report a proposed Schedule DCG 
(described below) to report individual participating plan information 
for each plan that is a part of the DCG reporting arrangement. 
Specifically, the content of the DCG annual return/report would include 
a Form 5500 Annual Return/Report of Employee Benefit Plan and any 
statements or schedules required to be attached to the form for such 
entity, completed in accordance with the instructions for the form, 
including Schedule A (Insurance Information), Schedule C (Service 
Provider Information), Schedule D (DFE/Participating Plan Information), 
Schedule G (Financial Transaction Schedules), Schedule H (Financial 
Information), Schedule R (Retirement Plan Information), Schedule DCG 
(Individual Plan Information), schedules described in Sec.  2520.103-
10(b)(1) and (b)(2), an IQPA audit report and the related financial 
statements covering the DCG trust, and, for DCG consolidated Form 5500 
filings that are intended to cover large plans (generally those with 
100 or more participants), an IQPA audit report and the related 
financial statements attached to the Schedule DCG for each such 
individual large plan. Financial statements include the financial 
statements of the trust, the notes to the financial statements and the 
schedules described in paragraph (b)(1) of Sec.  2520.103-10.
    Information reported on the various schedules to the Form 5500, 
other than the proposed Schedule DCG, would be reported in the 
aggregate. Thus, a Schedule A would be required for all insurance 
contracts that constitute one of the investments or investment 
alternatives available to all of the participants in a plan, regardless 
of whether certificates were to be issued to individual plans or 
participants upon selection of that option by a participant. The fees 
and commissions paid with respect to any insurance contracts available 
for investment by any of the plans/participants would be reported on 
the Schedule A. Similarly, a service provider to the trust and to each 
of the plans would be reported on Schedule C, even if the service 
provider did not actually provide services or charge fees to a 
particular plan because, for example, the service provider provided 
investment management services with respect to a particular investment 
option that was not selected by any of the participants in a particular 
plan. The $5,000 threshold would be based on the total amount received 
by the service provider. Reporting on Schedule C would still be 
required if the total amount was $5,000 or more, even if the amount 
paid by or charged against the assets of each the participating plans 
was less than $5,000 per plan. Reportable transactions on Schedule G 
would include any involving the assets of the trust and any parties in 
interest with respect to the trust. For reporting delinquent 
participant contributions on Schedule H, Line 4a, the Agencies would 
expect the DCG filing the annual report to identify the delinquent

[[Page 51497]]

participating employer in the attachment already required in the 
instructions.
    The Departments expect that cost savings for plans relying on a DCG 
filing compared to plans filing separately would generally only begin 
to emerge when the DCG collectively exceeds an aggregate participant 
count of 100 participants. In other words, the Departments do not 
expect a DCG filing to provide meaningful cost savings for plans, as 
compared to filing their own annual report, in the case of DCG 
arrangements with an aggregate participant count of under 100 
participants. Rather, the Departments expect in such cases that the 
individual plans would likely qualify for filing the Form 5500-SF and 
that they would likely find it more cost effective to file their own 
separate Form 5500-SF.\22\ Accordingly, this proposal does not include 
an option under which such a ``small'' DCG could file as a small plan 
filer. The Departments solicit comments on whether stakeholders expect 
there to be ``small'' DGCs, whether a ``small'' DCG alternative should 
be made available, and what the content requirements for such an 
alternative should be, e.g., whether the content of the ``small'' DCG 
annual return/report should include Schedule I instead of Schedule H, 
whether it should include the IQPA audit report and/or the schedules of 
assets, and whether it should include the Schedule C.\23\
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    \22\ Section III.A.1 of this preamble discusses the Departments' 
view that creating a consolidated group filing for employers 
required to file a Form 5500-EZ is similarly unlikely to generate 
administrative efficiencies for those employers, as compared to 
continuing to file separately.
    \23\ Since the aggregate participant count of the entire DCG 
would be less than 100, there could be no ``large plans'' 
participating in such a ``small'' DCG so the issue of an individual 
audit for a participating large plan would not arise.
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4. Proposed Schedule DCG (Individual Plan Information)
    Section 202(b) of the SECURE Act specifically provides that IRS and 
DOL may require the consolidated Form 5500 return/report filed by the 
DCG reporting arrangement to include any information regarding each 
plan in the group as IRS and DOL may determine necessary or appropriate 
for the enforcement and administration of the Code and ERISA. The 
proposed Schedule DCG would contain the plan level information needed 
by the IRS for administrating and enforcing tax laws passed by Congress 
and by the DOL for important Title I oversight functions, particularly 
with respect to large plans. A separate Schedule DCG would be required 
to be completed for each individual plan, similar to the requirement to 
complete a separate Schedule A for each insurance contract held by a 
plan or DFE filing the Form 5500. IRS examines individual plans, not 
groups of plans, to ensure that plan sponsors and/or employers comply 
with the tax laws governing retirement plans, and to help protect the 
retirement benefits of participants and beneficiaries. Thus, IRS 
requires information with respect to a plan's qualification, financial 
condition, and operation on a separate basis for each plan filing as 
part of a DCG. Individual plan financial information already reported 
on the Form 5500-SF is important for the DOL to continue to ensure that 
participants and beneficiaries of the individual plans participating in 
a DCG receive their promised benefits. The proposed Schedule DCG 
includes:
    <bullet> Part I--DCG name and EIN/PN modeled on the similar plan-
level information on other schedules to the Form 5500. Information in 
Part I must match the DCG information reported on Part II of the 
consolidated Form 5500.
    <bullet> Part II--confirmation that the plan for which the Schedule 
DCG is being filed is a single employer plan (as noted above, MEPs and 
multiemployer plans may not participate in a DCG under the proposal) 
and, if applicable, identification of the plan as a collectively 
bargained plan.
    <bullet> Part III--basic individual plan information, including the 
plan name, plan number, plan effective date, plan sponsor's name and 
address, plan sponsor's EIN, plan sponsor's telephone number, plan 
sponsor's business code, total number of participants, total number of 
active participants, number of participants with account balances, and 
number of participants who terminated employment during the plan year 
with accrued benefits that were less than 100% vested.
    <bullet> Part IV--plan financial information, including total plan 
assets (including participant loans), total plan liabilities, net plan 
assets, contributions received or receivable in cash from the employer, 
participants, and others; noncash contributions and, total 
contributions; benefit payments, corrective distributions, and certain 
deemed distributions of participant loans, direct expense information, 
net income, and assets transferred to (from) plans.
    <bullet> Part V--two-digit boxes for entry of all applicable codes 
in the List of Plan Characteristics Codes in the instructions to the 
Form 5500.
    <bullet> Part VI--compliance questions relating to delinquent 
participant contributions, plan assets/liabilities transferred from the 
plan, indication of whether the plan is a defined contribution plan 
subject to section 412 of the Code, plan coverage and nondiscrimination 
information, and whether a plan is a pre-approved plan that received a 
favorable IRS Opinion Letter.
    <bullet> Part VII--questions for large plans (generally plans 
covering 100 or more participants as of the beginning of the plan year) 
regarding the required individual IQPA report and financial statements 
that must be filed with the Schedule DCG filed for the participating 
large plan.

B. SECURE Act Section 101 Amendment to ERISA Section 103(g) 
Participating Employer Information

1. Participating Employer Reporting Under ERISA Section 103(g)
    As discussed above, section 103(g) of ERISA, which was added to 
ERISA by the Cooperative and Small Employer Charity Pension Flexibility 
Act (CSEC Act) in 2014,\24\ requires multiple employer plans to include 
with their annual reports ``a list of participating employers'' and, 
with respect to each participating employer, ``a good faith estimate of 
the percentage of total contributions made by such participating 
employers during the plan year.'' The DOL issued an interim final rule 
on November 10, 2014, which implemented the section 103(g) reporting 
requirements by requiring filers that check the ``multiple employer 
plan'' box on the face of the Form 5500 or the Form 5500-SF, and to 
attach a list of participating employers and a good faith estimate of 
the percentage of total contributions made by each participating 
employer during the plan year. \25\ The 2014 interim final rule and the 
corresponding instructions further provided that unfunded or insured 
multiple employer welfare plans that are exempt under 29 CFR 2520.104-
44 from filing financial statements with their annual report must 
attach a list of participating employers, but do not have to include an 
estimated amount of contributions from each employer.\26\ Pursuant to 
the interim final rule, the section 103(g) reporting change became 
effective with the 2014 Form 5500 Annual Return/Report forms. The 2016 
proposal on modernization of the Form 5500 included a proposal to 
finalize these changes.\27\
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    \24\ Public Law 113-97 (Apr. 7, 2014).
    \25\ 79 FR 66617 (Nov. 10, 2014).
    \26\ See, e.g., 2020 Form 5500 instructions at 14; see also 2020 
Form 5500-SF instructions at 8-9.
    \27\ 81 FR 47534, 47564-47565.
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    The DOL received four comments on the interim final rule and six 
additional

[[Page 51498]]

comments in connection with the Paperwork Reduction Act (PRA) notice 
associated with the publication of the interim final rule.\28\ In 
addition, two comments on the 2016 proposal related to the proposal to 
finalize the 2014 interim final rule.\29\ The central concerns of most 
of the commenters was that filing the participating employer list 
imposes material costs and burdens on multiple employer plans and that 
making the employer list public was not in the best interests of plan 
participants and beneficiaries. One commenter suggested that the DOL 
should not apply the section 103(g) reporting changes to defined 
contribution or welfare plans because ERISA section 103(g) was added as 
part of the CSEC Act, which generally focused on ERISA minimum funding 
requirements that are not applicable for the majority of defined 
contribution pension plans or to any group health and welfare plans. In 
the 2016 proposed rule as well as in the Field Assistance Bulletin No. 
2019-01,\30\ DOL stated its position that it believes the section 
103(g) reporting requirements adopted by the 2014 interim final rule, 
which apply the new requirements to all multiple employer plans 
(defined benefit pension plans, defined contribution plans, and welfare 
plans), are a reasonable and appropriate way to implement Congress' 
directive in the CSEC Act. The information has proven useful to the DOL 
for its oversight functions for both MEPs and those MEWAs that file the 
Form 5500, regardless of the types of benefits provided by the MEWA. 
Before the DOL finalized the section 103(g) reporting requirements, the 
SECURE Act was enacted, which amended the original language in ERISA 
section 103(g), reaffirming that MEPs, including association retirement 
plans, PEOs, and the newly created pooled employer plans would have to 
report not just the existing identifying information, but also new 
financial information.
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    \28\ See Proposed Extension of Information Collection Request 
Submitted for Public Comment; Revisions to Annual Return/Report--
Multiple Employer Plans, 79 FR 66741 (Nov. 10, 2014).
    \29\ Comments are available on the DOL's website.
    \30\ In 2019, the DOL issued Field Assistance Bulletin No. 2019-
01, which provided transition relief for MEPs that failed to file a 
complete and accurate participating employer information with their 
Form 5500 Annual Return/Report for the 2017 and prior plan years.
---------------------------------------------------------------------------

    Specifically, section 101 of the SECURE Act amended ERISA section 
103(g) by providing that annual reports for ``any plan to which [ERISA] 
section 210(a) applies (including a pooled employer plan)'' must 
include (1) a list of participating employers in the plan, a good faith 
estimate of the percentage of total contributions made by such 
participating employers during the plan year, and the aggregate account 
balances attributable to each employer in the plan (determined as the 
sum of the account balances of the employees of such employer (and the 
beneficiaries of such employees)); and (2) with respect to a pooled 
employer plan, identifying information for the person designated under 
the terms of the plan as the pooled plan provider. Although the SECURE 
Act added a specific reference to ERISA section 210(a), DOL believes 
that this reference was meant to emphasize that defined contribution 
multiple employer pension plans and different types of MEPs that became 
more accessible in recent years, such as association retirement plans, 
professional employer organization plans (PEOs), and the newly created 
pooled employer plan are required to comply with the participating 
employers reporting requirements, and not just defined benefit pension 
plans.
    The SECURE Act reporting changes are effective for plan years 
beginning on or after January 1, 2021. In order to implement the SECURE 
Act reporting requirements on a timely basis, the Agencies are 
proposing that, for the 2021 plan year, MEPs (including pooled employer 
plans, association retirement plans, and PEOs) would be required to 
provide the participating employer information as a nonstandard 
attachment to the 2021 Form 5500 Annual Return/Report in a similar 
manner as currently required, and the content of the attachment would 
be updated to add the aggregate account balances attributable to each 
participating employer in the plan to the current requirement to 
provide identifying information and the percent of contributions by 
each participating employer. In addition, a MEP that is a pooled 
employer plan would be required to indicate on the nonstandard 
attachment for 2021 that it is a pooled employer plan and provide 
information similar to information required to be reported on a 
proposed Schedule MEP, as discussed below, for the 2022 and following 
plan years, including confirming that the entity identified as the plan 
sponsor and administrator in Part I of the Form 5500 is the pooled plan 
provider, and providing the ACK ID for the pooled plan provider's most 
recent Form PR. For the 2022 and following plan years, MEPs would be 
required to report the participating employer information in a standard 
format on a proposed new Schedule MEP, as discussed below.
2. Participating Employer Reporting for MEWAs
    As discussed above, the SECURE Act amended ERISA section 103(g) by 
directing the reporting requirements specifically to multiple employer 
plans subject to ERISA section 210(a). The DOL continues to believe 
that receiving participating employer information from multiple 
employer welfare plans is important for oversight of such arrangements 
and should be continued. Even though the DOL originally relied on ERISA 
section 103(g) when it added the requirement for all multiple employer 
plans to provide the participating employer information, there are 
other rulemaking and reporting authorities that support continuing the 
reporting requirement for multiple employer welfare plans and extending 
it to non-plan MEWAs that file the Form M-1 (Report for Multiple 
Employer Welfare Arrangements (MEWAs) and Certain Other Entities 
Claiming Exception (ECEs) (Form M-1).
    Based on the authority in ERISA sections 101(g), 505, and 734, the 
DOL in 2003 promulgated a regulation at 29 CFR 2520.101-2 that required 
the administrators of both multiple employer welfare plans and non-plan 
MEWAs that offer or provide coverage for medical benefits to file the 
Form M-1 on an annual basis (Form M-1 annual report) as well as upon 
occurrence of certain registration events (Form M-1 registration 
filing). Effective for plan years beginning on or after January 1, 
2022, DOL is proposing to require MEWAs (plan and non-plan MEWAs) that 
offer or provide coverage for medical benefits to provide the 
participating employer information on the Form M-1 and not as an 
attachment to the Form 5500 Annual Return/Report. Specifically, new 
questions would be added to Form M-1 requiring MEWAs (plan and non-plan 
MEWAs) that offer or provide coverage for medical benefits to identify 
each participating employer in the MEWA by name and EIN and provide a 
good faith estimate of each participating employer's percentage of the 
total contributions made by all participating employer during the plan 
year. However, similar to the 2014 interim final rule issued under 
ERISA section 103(g), the Form M-1 proposal does not require 
contribution information from unfunded or insured MEWAs. Furthermore, 
the Form M-1 proposal would require contribution information on the 
Form M-1 annual report filing but not the Form M-1 registration filing. 
The DOL specifically solicits comments on whether the final rule should 
require participating

[[Page 51499]]

employer information on only the annual Form M-1 filing, and not on 
other M-1 required filings, in light of the fact that only annual 
information is required for plans reporting participating employer 
information on the Form 5500.
    With respect to multiple employer welfare plans that do not offer 
or provide coverage for medical benefits, and thus are not required to 
file a Form M-1 (for example, life or disability benefits), section 103 
of ERISA provides the DOL with the authority to require the plan 
administrator to furnish, as part of the Form 5500 annual report, the 
``name and address of each fiduciary.'' See ERISA section 103(c)(2). In 
the DOL's view, the employer is acting as a fiduciary with respect to 
its decision to provide ERISA-covered benefits through a MEWA rather 
than through a single employer plan and also is a fiduciary for 
purposes of continuing to monitor the plan that it adopted.\31\ 
Accordingly, the DOL is relying on ERISA section 103(c)(2) as its 
authority for requiring multiple employer welfare plans (other than 
those that file the Form M-1) to continue reporting the participating 
employer identifying information, and unless unfunded or insured, a 
good faith estimate of each participating employer's percentage of the 
total contributions made by all participating employer during the plan 
year.\32\ As is currently required for such plans, the information 
would continue to be filed as an attachment to the Form 5500 Annual 
Return/Report. MEWAs, however, whether those reporting on the Form 
5500/Form 5500-SF or the Form M-1, would not be required to provide the 
new aggregate account balances information that was added by the SECURE 
Act to section 103(g).
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    \31\ See Advisory Opinion Letter 2007-06A (Aug. 16, 2007) 
(``decisions regarding the method through which benefits are to be 
paid under an employee welfare benefit plan, including the selection 
of an insurer and the negotiation of the terms of any contractual 
arrangement obligating the plan, are matters that generally are 
subject to the fiduciary responsibility provisions of Title I of 
ERISA''.); Information Letter to Diana Ceresi (Feb. 2, 1998) (``when 
the selection of a health care provider involves the disposition of 
employee benefit plan assets, such selection is an exercise of 
authority or control with respect to the management and disposition 
of the plan's assets within the meaning of section 3(21) of ERISA, 
and thus constitutes a fiduciary act . . .''); See also Advisory 
Opinion Letter 2018-01A (Nov. 5, 2018) (In the context of a pension 
plan rollover service provider, not covered by Title 1 of ERISA, 
``When plan sponsors or other responsible fiduciaries choose to have 
a plan participate in the RCH Program, they are acting in a 
fiduciary capacity, and would be subject to the general fiduciary 
standards and prohibited transaction provisions of ERISA in 
selecting and monitoring the RCH Program.'')
    \32\ Similar to the 2014 interim final rule issued under ERISA 
section 103(g), such multiple employer welfare plans that are 
unfunded or insured and exempt under 29 CFR 2520.104-44 from filing 
financial statements with their annual report will continue to be 
required to attach a list of participating employers, but do not 
have to include the contribution information. See, e.g., 2020 Form 
5500 instructions at 14; see also 2020 Form 5500-SF instructions at 
8-9.
---------------------------------------------------------------------------

    For the 2021 plan year, pending the implementation of the Form M-1 
changes, all plan MEWAs would continue to provide participating 
employer information as a nonstandard attachment to the 2021 Form 5500 
Annual Return/Report in a similar manner as currently required.
    The proposal, by transferring the participating employer 
information from the Form 5500 Annual Return/Report to the Form M-1 for 
MEWAs that offer or provide coverage for medical benefits and 
continuing to require reporting of participating employer information 
on the Form 5500 Annual Return/Report for plan MEWAs that provide other 
benefits, would enable the DOL to receive such information from both 
plan and non-plan MEWAs, regardless of how they are funded or 
structured. The DOL and other users of the Form M-1 data (e.g., state 
insurance regulators) would have access to updated and current lists of 
participating employers because the Form M-1 must be filed annually as 
well as upon the occurrence of certain registration events (30 days 
prior to MEWAs operating in any state or expanding their operations 
into an additional state; and within 30 days of a merger, material 
change, or a participant increase of 50% or more).

C. Proposed Form 5500-Schedule MEP (Multiple Employer Pension Plan 
Information) and Requirement That MEPs (Including Pooled Employer 
Plans) File the Form 5500 and not the Form 5500-SF

    The proposal would add a new Schedule MEP (Multiple Employer 
Pension Plan Information) to the Form 5500 Annual Return/Report that 
would be completed by MEPs. The proposal also would add a limited 
number of additional data items elsewhere on the Form 5500 relevant to 
MEPs. The proposed Schedule MEP would provide a unified vehicle to 
report information related to new SECURE Act provisions, including 
information unique to MEPs. The first section, Part I, like the other 
schedules to the Form 5500, would require filers to enter identifying 
information (which must match the information entered on the Form 5500) 
and to indicate the plan type by checkbox. The instructions would 
provide general definitions for purposes of annual reporting for the 
various categories of pension plans that must complete the Schedule 
MEP. This would include different types of MEPs (group or association 
retirement plans within the meaning of 29 CFR 2510.3-55(b) (association 
retirement plans), professional employer organization plans within the 
meaning of 29 CFR 2510.3-55(c) (PEO plans), pooled employer plans 
within the meaning of ERISA section 3(43), and other MEPs covering the 
employees of two or more employers that are not single or multiemployer 
plans for annual reporting purposes). Multiemployer plans, as defined 
under section 3(37) of ERISA, would not be required to complete the 
Schedule MEP.\33\
---------------------------------------------------------------------------

    \33\ Multiemployer defined pension benefit plans are required to 
provide, on Form 5500, Schedule R (Retirement Plan Information), 
identifying information and the percentage of contributions for 
those plans that are five percent or more contributors for the plan 
year being reported.
---------------------------------------------------------------------------

    Part II of the proposed Schedule MEP would be a repeating line item 
on which all MEPs would report information under ERISA section 103(g) 
regarding participating employers, including employer/plan sponsor 
name, EIN, and the percentage of total contributions to the plan or 
arrangement by each participating employer, and the aggregate account 
balances information the SECURE Act added to ERISA section 103(g).\34\ 
That information is currently collected for MEPs as a non-standard 
attachment to the Form 5500 and Form 5500-SF.\35\ Pursuant to the 
SECURE Act, a new data element would be added to require reporting of 
the aggregate account balances for each participating employer in the 
MEP.
---------------------------------------------------------------------------

    \34\ As discussed above, MEWAs would report the participating 
employer information either as an attachment to the Form 5500 or on 
the Form M-1.
    \35\ The total contributions are the amount reported on Form 
5500, Schedule H, line 2(a)(3) or the total of lines 8a(1), 8a(2), 
and 8a(3) on the Form 5500-SF.
---------------------------------------------------------------------------

    Part III would be completed by pooled employer plans. A pooled 
employer plan would be required to indicate whether the pooled plan 
provider operating the plan (identified on the Form 5500 for each of 
the pooled employer plans it operates as both the plan sponsor and the 
plan administrator) has complied with the registration requirements for 
pooled plan providers under section 3(43) and 3(44) of ERISA by filing 
a Form PR, in accordance with that form's instructions.\36\ The pooled 
employer plan would be required to provide the ``ACK ID''--the 
acknowledgement code generated by the system in response to a completed 
filing--for the most recent

[[Page 51500]]

Form PR submitted.\37\ Pooled employer plans would also be required to 
indicate whether certain services were provided by an affiliate, and, 
if relying on a prohibited transaction exemption for the use of an 
affiliate, to identify the prohibited transaction (whether a class or 
individual) exemption.
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    \36\ See Form PR and its instructions, available at 
www.efast.dol.gov.
    \37\ The instructions to the Form PR advise the pooled plan 
provider that it must keep, under section 107, the electronic 
receipt for the Form PR filing as part of the records of the pooled 
employer plans operated by the pooled plan provider.
---------------------------------------------------------------------------

    The DOL, through rules and other initiatives, has pursued and 
required improvements in fee transparency to ensure that ERISA plan 
fiduciaries and plan participants are effectively informed about 
service provider fees and expenses, including cost and performance 
information of designated investment alternatives under the plan. These 
considerations are particularly important in the case of pooled 
employer plans and MEPs given their structure and the roles that 
traditional service providers end up playing as plan sponsors and plan 
administrators. Accordingly, comments are specifically solicited on 
whether more specifically tailored questions should be added, in 
addition to those already on the Schedules C and H, to report fee and 
expense information on pooled employer plans and other MEPs, including 
information on how fees and expenses are allocated among participating 
employers and among covered participants and beneficiaries.
    Further, the proposal would require all MEPs, similar to the 
current rule for multiemployer plans and the proposed rule for DCGs, to 
file the Form 5500 regardless of whether they would otherwise be 
eligible to file the Form 5500-SF. Making the filings across plan types 
more uniform would enable more consistent and informed oversight of 
collective retirement arrangements. Small MEPs would have the same 
simplified Form 5500 reporting as small pension plans, including MEPs, 
that currently file the Form 5500. They would be able to file the 
Schedule I instead of the Schedule H and its financial attachments, 
would not be required to complete the Schedule C or Schedule G, and 
would be able to file without having an IQPA audit and attaching an 
IQPA report.

D. Improving Usability of Data Collection for Schedule H, Line 4i 
Schedules of Assets

    By their nature, MEPs have the potential to build up a substantial 
amount of assets quickly and the effect of any abusive schemes on 
future retirement distributions may be hidden or difficult to detect 
for a long period. The DOL is aware that MEPs could be the target of 
fraud or abuse for this reason. Although DOL is not aware of direct 
information indicating that the risk for fraud and abuse is greater for 
MEPs than for other defined contribution pension plans, a key component 
of the proposal is to make the financial information reported on the 
Form 5500 Annual Return/Report more data mineable and accessible for 
enforcement and analysis purposes. The DOL does not believe it would be 
sensible to limit this aspect of the proposal to just pooled employer 
plans and other MEPs because, although an important data improvement 
for MEPs, the need for more relevant and comparable financial 
information extends to defined contribution and defined benefit pension 
plans generally. Reports from GAO, the DOL--Office of Inspector 
General, the ERISA Advisory Council, and the Treasury Inspector General 
for Tax Administration (``TIGTA'') have focused on the need for 
increased transparency and accountability generally in connection with 
employee benefit plan investments in hard-to-value and alternative 
assets and those held through pooled investment vehicles. It also would 
be confusing and inefficient to try to adopt these kinds of financial 
reporting improvement just for MEPs or for certain types of MEPs.
    Mandatory e-filing, which was implemented for the 2009 form filing 
year, changed both the regulated community's and the government's 
ability to use the Form 5500 Annual Return/Report data. The data sets 
developed from e-filing information have been helping researchers, 
businesses, and other plan professionals.\38\ The Form 5500 Annual 
Return/Report data sets can be one of the major building blocks for a 
private organization to use in developing information for employees and 
employers on plan administration. Currently, however, the line 4i 
attachments to Schedule H (Schedule of Assets Held at End of Year, 
Schedule of Assets Acquired and Disposed of Within Year and the 
Schedule of Reportable Transactions) are difficult to search, filter, 
aggregate, and analyze because they are not filed in a standardized 
electronic format. As a result, the Agencies, policymakers, employers, 
labor organizations, participants and beneficiaries, and the public 
have difficulty accessing key information about plan investments. This 
proposal to establish a standardized electronic filing format for the 
Schedule H, line 4i Schedules of Investments is also intended to be 
responsive to the OIG's recommendation that the Agencies create a 
searchable reporting format for the Schedule H, line 4i Schedules of 
Assets and otherwise increase the accessibility of Form 5500 Annual 
Return/Report information, particularly information on hard-to-value 
assets and multiple-employer plans. See DOL-OIG EBSA Needs to Provide 
Additional Guidance and Oversight to ERISA Plans Holding Hard-To-Value 
Alternative Investments, at 17. See also Private Pensions: Targeted 
Revisions Could Improve Usefulness of Form 5500 Information, at 37; see 
also U.S. Gov't Accountability Office, GAO-12-665, Federal Agencies 
Should Collect Data and Coordinate Oversight of Multiple Employer Plans 
(2012), at 30.
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    \38\ EBSA is responsible for collecting the Form 5500 Annual 
Return/Report, in part, to fulfill the statutory requirements under 
Sections 104 and 106 of ERISA, which require that DOL make annual 
reports filed under Title I of ERISA available to the public. EBSA 
also makes the Form 5500 filings and data available to the public 
under the Freedom of Information Act (FOIA), 5 U.S.C. 552. EBSA 
fulfills its responsibilities by making the Form 5500 Annual Return/
Report data available for downloading in bulk. See http://www.dol.gov/ebsa/foia/foia.html. These bulk data files, which EBSA 
updates at the end of each month with the Form 5500 Annual Return/
Report data collected during that month, are downloaded by private-
sector organizations that, in some cases, also make the data 
available on the internet. Thus, most returns/reports are currently 
open to public inspection, and the contents are public information 
subject to publication on the internet.
---------------------------------------------------------------------------

    Schedule H, line 4i would be separated into two elements--line 
4i(1) would ask whether the plan held assets for investment at the end 
of the year; line 4i(2) would ask about assets acquired and disposed of 
during the plan year. The information to be collected as part of the 
schedules would be largely unchanged, but some adjustments are being 
proposed to improve the consistency and quality of the data. The 
proposal clarifies conventions for identifying filers by name and 
identifying number(s).\39\ The proposal would require plans to use 
legal entity and other industry and regulatory identifiers for 
investment assets whenever possible. Check boxes are also being added 
for participant directed individual account plans to identify 
investments that are designated investment alternatives and qualified 
default investment alternatives and to require entry of the total 
annual

[[Page 51501]]

operating expenses for the investments expressed as a percentage of 
assets that was furnished to participants and beneficiaries in their 
most recent ``404a-5 statement.'' \40\ With the expected increase in 
employers choosing to offer retirement benefits through MEPs and DCGs, 
instead of stand-alone plans that file their own annual return/report, 
and the requirement for DCGs to provide the same investments and 
investment alternatives, these changes are intended to help the 
Agencies, employers, and other interested stakeholders compare plan 
participation, investment options, and investment performance from 
year-to-year.
---------------------------------------------------------------------------

    \39\ These changes are also intended to address concerns raised 
by the GAO in recommending that ``the Agencies develop a central 
repository for EIN and Plan Numbers (PNs) for filers and service 
providers to improve the comparability of form data across 
filings.'' GAO Private Pensions: Targeted Revisions Could Improve 
Usefulness of Form 5500 Information, at 37.
    \40\ See 29 CFR 2550.404a-5. The DOL published a final rule in 
2012 that was designed to help America's workers manage and invest 
the money they contribute to their 401(k)-type pension plans. The 
rule requires that workers in this type of plan are given, or have 
access to, the information they need to make informed decisions, 
including information about fees and expenses; the delivery of 
investment-related information in a format that enables workers to 
meaningfully compare the investment options under their pension 
plans; that plan fiduciaries use standard methodologies when 
calculating and disclosing expense and return information so as to 
achieve uniformity across the spectrum of investments that exist 
among and within plans, thus facilitating ``apples-to-apples'' 
comparisons among their plan's investment options; and a new level 
of fee and expense transparency. Requiring the total annual 
operating expenses from those statements to be included on the 
plan's Form 5500 is intended to help further that objective by 
allowing third-party data aggregators to build tools that will help 
employers, participants and beneficiaries, the Agencies, and other 
interested members of the public evaluate and monitor investment 
alternatives being made available for America's workers to save to 
their retirement.
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E. Schedules MB, SB and R--Proposed Modifications and Additions to 
Information Reported

    As described more fully below, the Agencies propose adding new 
questions to the Form 5500 Schedule MB (Multiemployer Defined Benefit 
Plan and Certain Money Purchase Plan Actuarial Information), Schedule 
SB (Single-Employer Defined Benefit Plan Actuarial Information), and 
Schedule R (Retirement Plan Information), and modifying the demographic 
and benefit attachment requirements to enable the Agencies to project 
more precisely defined benefit pension plans' and insurance programs' 
liabilities. Also for multiemployer defined benefit pension plans, 
among other changes, the Agencies propose identifying a larger number 
of contributing employers. For both single-employer and multiemployer 
defined benefit pension plans, the Agencies propose the option to 
provide certain required attachments in a spreadsheet file to make it 
easier for the Agencies to access the information.
1. Schedule MB Modifications
    Currently, Schedule MB requires that if any of the employer 
contributions reported in line 3 include amounts owed for withdrawal 
liability, an attachment must be provided listing the total withdrawal 
liability amounts and the dates such amounts were contributed. The 
Agencies propose modifying the line 3 instructions to require an 
attachment that breaks down the total withdrawal liability amounts by 
date, separately specifying the periodic withdrawal liability amounts 
and lump sum withdrawal liability amounts.
    Currently, line 6 of Schedule MB requires filers to provide 
information about the actuarial assumptions used to determine plan 
liabilities. The Agencies propose adding a new requirement for plans 
that assess withdrawal liability to an employer during the plan year to 
report the interest rate used to determine the present value of vested 
benefits for withdrawal liability determinations. This information 
would be reported in a new line, which would become line 6f. In 
addition, the Agencies propose modifying the questions related to the 
line 6 ``expense load'' to better align with the various ways 
multiemployer plans incorporate expense loads into their calculations. 
Filers would be required to indicate if an expense load is included in 
normal cost and, if so, whether it is determined as a percentage of 
normal cost, a dollar amount that varies from year to year, or 
something else. As part of the modification, the Agencies propose 
moving the expense load from line 6e to a new line 6i and to revise the 
instructions accordingly.
    In addition, the Agencies propose modifying line 8 of Schedule MB 
by requiring additional information about demographics, benefits, and 
contributions as described below. As is the case currently with respect 
to line 8, these requirements would apply only to PBGC-insured 
multiemployer plans with 500 or more total participants as of the 
beginning of the plan year.
    <bullet> Benefit Projections--Currently, such plans are required to 
attach a projection of benefits expected to be paid in each of the next 
ten years (see line 8b(1)).\41\ The Agencies propose modifying the 
format of the attachment to show the benefit projection broken down 
into three categories based on the participant's or beneficiary's 
status on the valuation date (i.e., active, terminated vested, in pay 
status). In addition, the projection period would be extended from 10 
to 50 years. It is the Agencies' understanding that almost all 
valuation software automatically generates these numbers and that it 
takes the same amount of effort to project 50 years as it does to 
project 10 years.
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    \41\ The current instructions provide that the line 8b(1) 
attachment is required for plans with 500 or more participants as of 
the valuation date, not as of the beginning of the plan year. The 
Agencies are proposing to change that to ``the beginning of the plan 
year'' because the only participant count reported on Schedule MB is 
the count at the beginning of the plan year (i.e., line 2b(3)(c), 
column 1) and because doing so is consistent with another Schedule 
MB requirement, See instructions for line 8b(2).
---------------------------------------------------------------------------

    <bullet> Contribution Projections--The Agencies propose adding a 
new requirement that such plans provide, as an attachment, a 10-year 
projection of employer contributions and withdrawal liability payments. 
A new line, line 8b(3), would be added to Schedule MB where the filer 
would report whether the projection is required. As is the case with 
the benefit projection attachments, the instructions would provide the 
required format for the attachment.
    <bullet> Average age/benefit--The Agencies propose requiring such 
plans to report the average age and average monthly benefit separately 
for terminated vested participants and retired participants and 
beneficiaries receiving payments. This information would be provided 
directly on Schedule MB, in new line 8b(4).
    The Agencies also propose a change to the ``age/service'' scatter 
attachment which is currently required for PBGC-insured multiemployer 
plans with active participants, regardless of the number of 
participants. Currently, the scatter shows, for each ``attained age'' 
and ``years of credited service'' grouping of active participants, the 
number of active participants, and if the total number of active 
participants at the beginning of the plan year is 1,000 or more, (1) 
for plans that use compensation to determine benefits, the average 
compensation, and (2) for cash balance plans, the average cash balance 
account (see line 8b(2)). The Agencies propose modifying the age/
service scatter by deleting the required information related to cash 
balance plans and adding a requirement to report average accrued 
monthly benefits as of the valuation date for each grouping (for plans 
with 1,000 or more active participants at the beginning of the year). 
As is the case with respect to average compensation, the accrued 
benefit information would not be required for any age/service 
combination that contains fewer than 20 participants.
    The Agencies also propose clarifying the line 4f instructions and 
Schedule language concerning when (or if) plans in critical status or 
critical and

[[Page 51502]]

declining status are projected to emerge or become insolvent, as 
filers' previous responses indicate they may have been confused as to 
how to fill out line 4f correctly.
2. Modifications to Schedule SB
    The Agencies propose making the Schedule SB (actuarial schedule), 
line 26 reporting requirements about demographics and benefits similar 
to the requirements for PBGC-insured multiemployer plans. Consistent 
with the requirements for PBGC-insured multiemployer plans, the new 
single-employer plan requirements would apply only to plans with 500 or 
more total participants. However, because the only participant count 
information reported on Schedule SB is as of the valuation date, for 
single-employer plans, participants are counted as of the valuation 
date for this purpose instead of as of the beginning of the plan year. 
Such plans would be required to attach a projection of benefits 
expected to be paid in each of the next 50 years broken down into three 
categories based on the participant's or beneficiary's status on the 
valuation date (i.e., active, terminated vested, in pay status). The 
instructions would provide the requirements for the attachment's 
format. The Agencies are also proposing that these plans report the 
average age and average monthly benefit separately for terminated 
vested participants and retired participants and beneficiaries 
receiving payments. As discussed above, the Agencies do not believe the 
benefit projection requirement would be burdensome for such single-
employer plans, as almost all valuation software automatically 
generates these numbers.
    To facilitate these changes, the Agencies propose rearranging 
Schedule SB line 26. Currently, line 26 relates only to the ``age/
service'' scatter of active participant data required to be attached to 
Schedule SB for PBGC-insured single-employer plans with active 
participants. The Agencies propose changing line 26 into a three-part 
question (26a, 26b, and 26c). Line 26a would be the current line 26. 
New line 26b would require PBGC-insured single-employer plans with 500 
or more total participants as of the valuation date to attach a 
projection of expected benefit payments. New line 26c would be the line 
for plans to report average age and average monthly benefit 
information.
    The Agencies propose modifying Part IX of the Schedule SB, and its 
instructions, so that it relates to elective funding relief provided 
under the American Rescue Plan (ARP) Act of 2021 instead of elective 
funding relief provided under the Pension Relief Act of 2010 (PRA 
2010). The PRA 2010 information is no longer needed because the ARP Act 
reduces to zero all shortfall amortization bases, including 
amortization bases established pursuant to the PRA 2010 elective 
funding relief. As modified, plan sponsors of single-employer defined 
benefit plans that elect to have the ARP Act extended amortization rule 
apply before the 2022 plan year would be required to report the first 
plan year to which the extended amortization rule applies.
3. Modification to Schedule R Reporting Requirement
    The Agencies propose modifying Schedule R's Part V, line 13 
requirement that multiemployer defined benefit pension plans subject to 
minimum funding standards report identifying information about any 
participating employer whose contributions to the plan account for more 
than five (5) percent of the total contributions for the year. The 
proposed change would require that plans report identifying information 
about any participating employer who either (1) contributed more than 
five percent of the plan's total contributions or (2) was one of the 
top ten highest contributors. This will ensure that reported data 
represents a reasonable sampling of contributors.
4. Change in Format for Certain Schedule MB and SB Attachments
    EFAST filers currently file Form 5500 attachments as PDF and plain 
text (TXT) files. A PDF file is required only if the attachment is 
supposed to be signed. TXT attachments are rarely provided. Many 
attachments include a lot of numbers (e.g., benefit projections, age/
service scatters) that are reported in tables. These numbers have to be 
extracted out of PDF tables and entered into databases or spreadsheets 
before the Agencies can use the information for various projects, 
studies, etc. This is costly and inefficient. It would be more 
efficient for the Agencies if this information was instead provided by 
filers in a tabular format (spreadsheet). Therefore, the Agencies 
propose modifying the instructions to allow and suggest (but not 
require) that certain attachments be provided in a tabular format 
(spreadsheet) such as CSV or XLS rather than PDF or TXT formats. The 
attachments affected by this change are:

------------------------------------------------------------------------
         Attachment             Schedule MB           Schedule SB
------------------------------------------------------------------------
Schedule of Projection of     Line 8b(1).....  Line 26b.
 Expected Benefit Payments.
Schedule of Active            Line 8b(2).....  Line 26a.
 Participant Data (i.e., Age/
 service scatter).
Withdrawal Liability Amounts  Line 3.........  N/A.
Schedule of Projection of     Line 8b(3).....  N/A.
 Employer Contributions and
 Withdrawal Liability.
------------------------------------------------------------------------

    Because much of this information is automatically generated by 
valuation software, the Agencies expect that this option may simplify 
the process for preparing attachments as well.

F. Internal Revenue Code-Based Questions for the 2022 Form 5500s

    Prior to 2009, Schedule E, ESOP Annual Information, Schedule P, 
Annual Return of Fiduciary of Employee Benefit Trust, and Schedule T, 
Qualified Pension Plan Coverage Information, were required as part of 
the annual return under section 6058(a) of the Code and associated 
regulations, but they were not information collections of the DOL or 
the PBGC. Beginning in 2009, DOL mandated electronic filing of Form 
5500, Annual Return/Report of Employee Benefit Plan, and Form 5500-SF, 
Short Form Annual Return/Report of Small Employee Benefit Plan. 
Limitations on the IRS' authority to require electronic filing of 
annual returns resulted in the removal of the ``IRS-only'' schedules 
from the Form 5500 filing requirements. See Code section 6011(e).
    The 2011 report from the TIGTA entitled ``The Employee Plans 
Function Should Continue Its Efforts to Obtain Needed Retirement Plan 
Information'' notes that the lack of information contained on Schedules 
E, P, and T can negatively impact the IRS's ability to effectively 
focus on specific factors of noncompliance when selecting retirement 
plans for examination. This lack of information may result in the IRS 
selecting relatively compliant plans, which increases the burden on 
these plans and affects the IRS's ability to identify and focus on 
potentially noncompliant plans. Additionally, the Employee Plans (EP) 
function has

[[Page 51503]]

focused its examination strategy on identifying plans with non-
compliance by using compliance strategies and data analysis. Compliance 
strategies use agents' experience to identify certain types of plans 
where EP sees numerous qualification failures. EP uses data analysis by 
identifying certain responses to questions on the Form 5500 that 
indicate that a plan may be non-compliant.
    Rather than reinstating the Schedules E, P, and T, the IRS is 
proposing to add new questions to the 2022 Form 5500 that are designed 
to assist the IRS in identifying plans that are non-compliant relating 
to Code section 410(b) coverage, Code section 401(a)(4) non-
discrimination, and Code section 401(k) non-discrimination testing. 
Additionally, the IRS is proposing to add a question that will help it 
identify whether adopters of pre-approved plans have been updated 
timely for changes in the law. DCGs would report this information at 
the plan level as part of the Schedule DCG.
    Specifically, the proposal would add a nondiscrimination and 
coverage test question to Form 5500 and Form 5500-SF that was on the 
Schedule T before it was eliminated. The question asks if the employer 
aggregated plans in testing whether the plan satisfied the 
nondiscrimination and coverage tests of Code sections 401(a)(4) and 
410(b). A plan that is aggregated with another plan to pass either 
nondiscrimination or coverage testing generally has more issues that 
are technically complicated and raise the possibility of non-
compliance. Adding this question will allow EP to identify these plans 
for examination over plans that are likely more compliant with the law. 
This question is also helpful when performing pre-examination analysis 
and allows the IRS to narrow any inquiries for information that is 
requested from the plan sponsor. The restoration of this question also 
reflects the elimination of optional coverage and nondiscrimination 
demonstrations in the IRS determination letter process. See Rev. Proc. 
2012-6, 2012-1 I.R.B. 235, and Announcement 2011-82, 2011-52 I.R.B. 
1052.
    The proposal would add a question to Form 5500 and Form 5500-SF, 
for section 401(k) plans, asking whether the plan sponsor used the 
design-based safe harbor rules or, if applicable, the ``prior year'' or 
``current year'' ADP test. ADP testing and nondiscrimination are 
significant compliance issues for section 401(k) plans. For example, a 
plan that performs prior year or current year ADP testing is more 
likely to have compliance issues than a plan with a designed-based safe 
harbor. Adding this question will allow EP to identify for examination 
section 401(k) plans that use ADP testing over plans that have 
designed-based safe harbors. This question will also help the IRS 
perform pre-examination analysis and, for design-based safe harbor 
plans, verify whether (1) allocations of required safe harbor 
contributions comply with the terms of the plan, and (2) proper notice 
requirements are satisfied on an annual basis.
    The proposal would add a question to Form 5500 and Form 5500-
SF,\42\ asking whether the employer is an adopter of a pre-approved 
plan that received a favorable IRS Opinion Letter, the date of the 
favorable Opinion Letter, and the Opinion Letter serial number. This 
question will help the IRS identify whether a plan sponsor has adopted 
a pre-approved plan and to determine whether the plan was adopted 
timely in accordance with the Code section 401(b) remedial amendment 
period. This question will also assist the IRS in determining whether 
to select a plan for examination as a late amender for changes in the 
law.
---------------------------------------------------------------------------

    \42\ IRS will separately make a parallel update to the Form 
5500-EZ, which is solely in the jurisdiction of the IRS.
---------------------------------------------------------------------------

    Finally, the proposal would add a new checkbox F to Form 5500-EZ, 
Part I, asking whether a filer is required to file Form 5500-EZ 
electronically pursuant to Treas. Reg Sec.  301.6058-2. A filer who has 
to file at least the applicable number of returns with the IRS during a 
calendar year generally must file Form 5500-EZ electronically under 
EFAST2. The applicable number is 10 for returns required to be filed 
during calendar years after 2022. If a filer is required to file Form 
5500-EZ electronically, but fails to do so, the filer is deemed to have 
failed to file Form 5500-EZ. This question will assist IRS in 
determining if a filer is in compliance with IRS mandatory electronic 
filing rules, in the event a paper Form 5500-EZ is filed.

G. Change to Participant-Count Methodology for Determining Independent 
Qualified Public Accountant Audit Requirement for Individual Account 
Plans

    The Agencies are proposing to change the rules for determining when 
a defined contribution pension plan is exempt from the requirement to 
include an IQPA report with its annual return/report filing. Currently, 
the plan size measure for the IQPA audit requirement is based on the 
total number of participants at the beginning of the plan year, 
including those eligible to elect to have contributions made under a 
section 401(k) qualified cash or deferred arrangement even if they have 
not elected to participate and do not have an account balance in a 
section 401(k) or 403(b) plan. Some stakeholders have pointed out that 
the use of this definition for the audit threshold may result in two 
plans with the same number of active participants, e.g., 85 account 
holders, with one subject to an audit and the other not based on the 
number of non-participating but eligible employees of the plan sponsor. 
They questioned the policy basis for such a difference in application 
of the audit requirement. Further, under this definition, some 
stakeholders have suggested that section 112 of the SECURE Act could 
make it even more likely that a plan with a small number of active 
participants may be required to bear the cost of an audit based on 
eligible but not participating employees being counted toward the audit 
threshold. Specifically, because section 112 provides that long-term, 
part time workers that have reached the plan's minimum age requirement 
and worked at least 500 hours in each of three consecutive 12-months 
period must be permitted to make elective contributions to a section 
401(k) qualified cash or deferred arrangement for plan years beginning 
on or after January 1, 2024, there could be more employees eligible to 
participate that elect not to do so. These eligible employees who are 
not active participants would still be impacting the threshold for 
determining whether the plan would have to file as a large plan.\43\
---------------------------------------------------------------------------

    \43\ The Agencies proposed a similar change in 2016 and received 
few comments on that aspect of the proposal. 81 FR 47534 (Jul. 16, 
2016).
---------------------------------------------------------------------------

    To address these issues, the Agencies are proposing to add to the 
Form 5500 and Form 5500-SF a new question for defined contribution 
pension plans only, asking for the number of participants with account 
balances at the ``beginning of the year,'' in addition to the current 
end-of-year count for defined contribution pension plan participants 
with account balances. Defined contribution pension plans would 
determine whether they have to file as a large plan and whether they 
have to attach an IQPA report and audited financial statements based on 
the number of participants with account balances as of the beginning of 
the plan year, as reported on the face of the Form 5500 or Form 5500-
SF. To avoid circumstances in which a beginning-of-year count would 
result in an inappropriate exclusion of large plans

[[Page 51504]]

from the audit requirement, for first plan year filings, the 
participant count for this purpose would exclude only plans that have 
fewer than 100 participants with account balances both at the beginning 
of the first plan year and the end of the first plan year.\44\ Thus, 
under the proposal, the determination would be based on the number of 
participants with account balances as of the beginning of the plan year 
(as reported on proposed line 6g(1) of the Form 5500 or line 5c(1) of 
the Form 5500-SF), except that the determination for first plan year 
filings would be based on the number of participants with account 
balances both at the beginning of the plan year and at the end of the 
plan year (as reported on proposed line 6g(2) of the Form 5500 and line 
5c(2) of the Form 5500-SF).
---------------------------------------------------------------------------

    \44\ This would not otherwise change how participants are 
counted for Form 5500 reporting purposes.
---------------------------------------------------------------------------

H. Miscellaneous and Conforming Changes for Forms and Instructions

    Various other technical, formatting, and conforming changes to the 
forms, schedules, and instructions are being proposed as part of the 
substantial restructuring of the Form 5500 Annual Return/Report 
described in this notice. For example, to implement the proposed 
Schedule MEP and Schedule DCG, the proposal includes conforming changes 
to other parts of the forms, schedules, and instructions. The 
instructions for what constitutes a multiple employer plan for purposes 
of the Form 5500 would generally be left unchanged, but conforming 
changes would be made throughout the instructions as necessary to 
reference the Schedule MEP and pooled employer plans for pension plans. 
The instructions would also be amended to reflect the transferring of 
the participating employer information from the Form 5500 Annual 
Return/Report to the Form M-1 for MEWAs that offer or provide coverage 
for medical benefits, and continued reporting of participating employer 
information on the Form 5500 Annual Return/Report as an attachment for 
plan MEWAs that provide other benefits. The instructions for Part I, 
DFE box, would be updated to add a code for DCGs, which would be 
instructed to check the DFE box, enter the correct code, and attach the 
proposed Schedule DCG. The proposed Schedule MEP and Schedule DCG would 
be added to the list of pension schedules. DCG filers would have to 
check that they are adding the Schedule DCG and enter the number of 
Schedules DCG attached. Other conforming changes would also be made 
throughout the instructions as necessary to reference DCGs and Schedule 
DCG. The DOL's reporting regulation at 29 CFR 2520.103-1(c)(2)(ii) and 
the Form 5500-SF instructions would be amended to add MEPs and DCGs to 
those types of filers that are not permitted to file a Form 5500-SF, 
but must instead file the Form 5500, with all required schedules and 
attachments. The instructions would be revised to state that pooled 
employer plans and DCGs would not report investment assets aggregated 
into master trust investment accounts (MTIAs) because the purpose of 
the MTIA reporting structure is to provide a financial reporting 
structure for groups of affiliated plans (e.g., separate plans of 
controlled group members) that utilize master trusts for the collective 
investment of the assets of the affiliated plans. The Departments do 
not believe that separate pooled employer plans and DCGs are 
``affiliated'' in the way that was envisioned for master trust 
reporting by plans and may in fact create an overly complex and 
undesirable lack of transparency if used in the case of pooled employer 
plans and DCGs.
    The proposal would also add new breakout categories to the 
``Administrative Expenses'' category of the Income and Expenses section 
of the Schedule H balance sheet. The Agencies have determined that to 
get a better picture of plan expenses, particularly those related to 
service providers, more detail in this category is warranted. 
Accordingly, data elements would be added for ``Salaries and 
allowances,'' ``Independent Qualified Public Accountant (IQPA) Audit 
fees,'' ``Recordkeeping and Other Accounting Fees,'' ``Bank or Trust 
Company Trustee/Custodial Fees,'' ``Actuarial fees,'' ``Legal fees,'' 
``Valuation/appraisal fees,'' and ``Trustee fees/expenses (including 
travel, seminars, meetings.'' Other than IQPA Audit Fees and Bank or 
Trust Company Trustee/Custodial Fees, these questions were on the Form 
5500 prior to 1999.\45\ As noted above in connection with pooled 
employer plans and MEPs, transparency and improved reporting of fees 
and expenses is an ongoing objective for the DOL and an important goal 
for continuing to improve the Form 5500 as a tool for financial 
transparency and accountability among employee benefit plans. 
Accordingly, the agencies specifically request comments on whether the 
final rule should require more detailed reporting regarding fee and 
expense information on the Form 5500. Useful comments would include, 
for example, suggestions on how to improve reporting of direct and 
indirect service provider compensation, generally and in particular 
with respect to pooled employer plans, other MEPs, and DCG reporting 
arrangements (including information about how the fees and expenses are 
allocated among participating plans, employers, and plan participants 
and beneficiaries, as applicable). Another example of an area of 
interest on fee information is whether the Form 5500 would be an 
appropriate vehicle for collecting information on fees charged to 
participants or alternate payees by a retirement plan--including plan 
service provider fees the plan passes on to participants--for review 
and qualification of domestic relations orders.\46\
---------------------------------------------------------------------------

    \45\ See 1998 Form 5500, line 32(g).
    \46\ See Government Accountability Office (GAO) Report GAO 20-
541, ``Retirement Security: DOL Could Better Inform Divorcing 
Parties About Dividing Savings,'' which recommended that ``EBSA 
should explore ways to collect information on fees charged to 
participants or alternate payees by a retirement plan--including 
plan service provider fees the plan passes on to participants--for 
review and qualification of domestic relations orders and evaluate 
the burden of doing so. For example, DOL could consider collecting 
fee information as part of existing reporting requirements in the 
Form 5500.''
---------------------------------------------------------------------------

    The proposal would also amend the Form 5500 instructions to make 
explicit that the pooled plan provider operating the pooled employer 
plan must report the same identifying information--i.e., name and EIN 
for itself, identified affiliates and other service providers, and 
trustees--on the Form PR for the pooled plan provider and on the Forms 
5500 for every pooled employer plan the pooled plan provider operates. 
The instructions to the new Form PR have parallel instructions. The 
proposal would also amend the Form 5500 and Form 5500-SF instructions 
and make conforming changes to the other parts of the forms, schedules, 
and instructions to implement the proposed changes described above to 
the participant count methodology for individual account plans for 
determining whether such plans have to file as a large plan and whether 
they have to attach an IQPA report.

IV. Paperwork Reduction Act Statement

    As part of continuing efforts to reduce paperwork and respondent 
burden, the general public and Federal agencies are invited to comment 
on proposed and/or continuing collections of information in accordance 
with the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 
3506(c)(2)(A)). This helps to ensure that requested data will be 
provided in the

[[Page 51505]]

desired format, reporting burden (time and financial resources) will be 
minimized, collection instruments will be clearly understood, and the 
impact of collection requirements on respondents is properly assessed. 
Currently, the DOL is soliciting comments concerning the proposed 
revisions of the Form 5500 Annual Return/Report, Form M-1 and Summary 
Annual Report, which are information collection requests subject to the 
PRA. A copy of the ICRs may be obtained by contacting the person listed 
in the PRA Addressee section below. The DOL has submitted a copy of the 
proposed revisions to the Office of Management and Budget (OMB) in 
accordance with 44 U.S.C. 3507(d) for its review of the DOL's 
information collection. The IRS and the PBGC intend to submit separate 
requests for OMB review and approval based upon the final forms 
revisions. The DOL and OMB are particularly interested in comments 
that:
    <bullet> Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the Agencies, 
including whether the information will have practical utility;
    <bullet> Evaluate the accuracy of the estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used;
    <bullet> Enhance the quality, utility, and clarity of the 
information to be collected; and
    <bullet> Minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of responses.
    Comments should be sent to the Office of Information and Regulatory 
Affairs, Office of Management and Budget, Room 10235, New Executive 
Office Building, Washington, DC 20503 and marked ``Attention: Desk 
Officer for the Employee Benefits Security Administration.'' Comments 
can also be submitted by Fax: 202-395-5806 (this is not a toll-free 
number), or by email: <a href="/cdn-cgi/l/email-protection#f7b8bea5b6a88482959a9e84849e9899b7989a95d9929887d9909881"><span class="__cf_email__" data-cfemail="7b3432293a24080e19161208081214153b141619551e140b551c140d">[email protected]</span></a>. OMB requests that 
comments be received by October 15, 2021, which is 30 days from 
publication of the proposed rule to ensure their consideration.
    PRA Addressee: Address requests for copies of the ICR to James 
Butikofer, Office of Regulations and Interpretations, U.S. Department 
of Labor, Employee Benefits Security Administration, 200 Constitution 
Avenue NW, Room N-5655, Washington, DC 20210. Email: <a href="/cdn-cgi/l/email-protection#c3a6a1b0a2edacb3b183a7acafeda4acb5"><span class="__cf_email__" data-cfemail="99fcfbeaf8b7f6e9ebd9fdf6f5b7fef6ef">[email protected]</span></a>. 
ICRs submitted to OMB also are available at http://www.RegInfo.gov.
    Form 5500 ICR: As described below, DOL is requesting a new OMB 
Control Number for this collection. The request for a new control 
number is for administrative reasons only. The DOL is currently in the 
process of requesting an extension for OMB Control Number 1210-0110, 
Annual Information Return/Report of Employee Benefit Plan. Once all of 
the outstanding actions are complete, the DOL intends to submit a 
nonmaterial change request to transfer the burden from the new ICR to 
the existing OMB control number for the Annual Information Return/
Report of Employee Benefit Plan (1210-0110) and proceed to discontinue 
the use of the new control number.
    The Agencies' burden estimation methodology excludes certain 
activities from the calculation of ``burden.'' If the activity is 
performed for any reason other than compliance with the applicable 
federal tax administration system or the Title I annual reporting 
requirements, it was not counted as part of the paperwork burden. For 
example, most businesses or financial entities maintain, in the 
ordinary course of business, detailed accounts of assets and 
liabilities, and income and expenses for the purposes of operating the 
business or entity. These recordkeeping activities were not included in 
the calculation of burden because prudent business or financial 
entities normally have that information available for reasons other 
than federal tax or Title I annual reporting. Only time for gathering 
and processing information associated with the tax return/annual 
reporting systems, and learning about the law, was included. In 
addition, an activity is counted as a burden only once if performed for 
both tax and Title I purposes. The Agencies also have designed the 
instruction package for the Form 5500 Annual Return/Report so that 
filers generally will be able to complete the Form 5500 Annual Return/
Report by reading the instructions without needing to refer to the 
statutes or regulations. The Agencies, therefore, have included in 
their PRA calculations a burden for reading the instructions and find 
there is no recordkeeping burden attributable to the Form 5500 Annual 
Return/Report. The DOL solicits comments regarding whether or not any 
recordkeeping beyond that which is usual and customary is necessary to 
complete the Form 5500 Annual Return/Report. Comments are also 
solicited on whether the Form 5500 Annual Return/Report instructions 
are generally sufficient to enable filers to complete the Form 5500 
Annual Return/Report without needing to refer to the statutes or 
regulations.
    Summary Annual Report ICR: Section 2520.104b-10 sets forth the 
requirements for the Summary Annual Report (SAR) appendix and 
prescribes formats for such reports. The DOL is proposing to revise the 
currently approved information collection (1210-0040) to include 
required additions to the SAR formats that reflect the addition of the 
new Schedule MEP and Schedule DCG to the 5500 Annual Report/Return.
    Form M-1 ICR: Effective for plan years beginning on or after 
January 1, 2022, DOL is proposing to amend the Form M-1 information 
collection (1210-0116) by adding new questions requiring MEWAs (plan 
and non-plan MEWAs) that offer or provide coverage for medical care to 
identify each participating employer in the MEWA by name and EIN. MEWAs 
that are not unfunded or insured must also provide participating 
employer's percentage of the total contributions (employer and 
employee) made by all employer participating in a MEP. This information 
is currently reported as a non-standard attachment as part of the Form 
5500 filing. The reporting of this burden is being moved from OMB 
control number 1210-0110. For the 2021 plan year, pending the 
implementation of the Form M-1 changes, plan MEWAs that offer or 
provide coverage for medical care would be required provide 
participating employer information as a nonstandard attachment to the 
2021 Form 5500 Annual Return/Report in a similar manner as currently 
required. A summary of paperwork burden estimates follows:
    Agency: DOL-EBSA.
    Type of Review: New information collection.
    Title: Annual Information Return/Report of Employee Benefit Plan.
    Affected Public: Individuals or households; Private Sector--
Business or other for-profit; Not-for-profit institutions.
    Forms: Form 5500 and Schedules.
    Total Respondents: 804,000.
    Total Responses: 804,000.
    Frequency of Response: Annually.
    Estimated Total Burden Hours: 588,000.
    Total Annualized Costs: $275 million.

    Agency: Department of Treasury--IRS.
    Type of Revision: Revision of existing collection.
    Title of Collection: Annual Return/Report of Employee Benefit Plan.

[[Page 51506]]

    OMB Control Number: 1545-1610.
    Affected Public: Individuals or households; Private Sector--
Business or other for-profit; Not-for-profit institutions.
    Forms: Form 5500 and Schedules.
    Total Respondents: 804,000.
    Total Responses: 804,000.
    Frequency of Response: Annually.
    Estimated Total Burden Hours: 354,000.
    Total Annualized Costs: $142 million.

    Agency: PBGC.
    Type of Revision: Revision of existing collection.
    Title of Collection: Annual Information Return/Report.
    OMB Control Number: 1212-0057.
    Affected Public: Individuals or households; Private Sector--
Business or other for-profit; Not-for-profit institutions.
    Forms: Form 5500 and Schedules.
    Total Respondents: 24,744.
    Total Responses: 24,744.
    Frequency of Response: Annually.
    Estimated Total Burden Hours: 1,242.
    Total Annualized Costs: $2 million.

    Agency: DOL-EBSA.
    Type of Revision: Revision of existing collection.
    Title of Collection: Annual Report for Multiple Employer Welfare 
Arrangements.
    OMB Control Number: 1210-0116.
    Affected Public: Not-for-profit institutions, Businesses or other 
for-profits.
    Forms: Form M-1.
    Total Respondents: 687.
    Total Responses: 687.
    Frequency of Response: Annually.
    Estimated Total Burden Hours: 141.
    Total Annualized Costs: $126,556.

    Agency: DOL-EBSA.
    Type of Revision: Revision of existing collection.
    Title of Collection: Summary Annual Report Requirement.
    OMB Control Number: 1210-0040.
    Affected Public: Not-for-profit institutions, Businesses or other 
for-profits.
    Total Respondents: 761,170.
    Total Responses: 177,793,034.
    Frequency of Response: Annually.
    Estimated Total Burden Hours: 1,110,692.
    Total Annualized Costs: $20,320,505.
    The DOL solicits comments regarding whether or not any 
recordkeeping beyond that which is usual and customary is necessary to 
complete the Form 5500 Annual Return/Report. Comments are also 
solicited on whether the Form 5500 Annual Return/Report instructions 
are generally sufficient to enable filers to complete the Form 5500 
Annual Return/Report without needing to refer to the statutes or 
regulations.
    Paperwork and Respondent Burden: Estimated time needed to complete 
the forms listed below reflects the combined requirements of the IRS, 
the DOL, and the PBGC. The times will vary depending on individual 
circumstances. The estimated average times are:

----------------------------------------------------------------------------------------------------------------
                                                                     Pension plans
                                      --------------------------------------------------------------------------
                                                Large           Small, filing Form 5500   Small, filing 5500-SF
----------------------------------------------------------------------------------------------------------------
Form 5500............................  1 hr, 51 min...........  1 hr, 19 min...........
Sch A................................  2 hr, 52 min...........  2 hr, 52 min...........
Sch MB...............................  8 hr, 49 min...........  8 hr, 6 min............  8 hr, 6 min.
Sch SB...............................  6 hr, 38 min...........  6 hr, 49 min...........  6 hr, 49 min.
Sch C................................  2 hr, 52 min...........
Sch D................................  1 hr, 39 min...........  20 min.................
Sch G................................  14 hr, 22 min..........
Sch H................................  11 hr, 51 min..........
Sch I................................  2 hr, 6 min............  2 hr, 6 min............
Sch R................................  1 hr, 45 min...........  1 hr, 7 min............
Form 5500-SF.........................  .......................  .......................  2 hr, 35 min.
Sch MEP..............................  10 min.................
----------------------------------------------------------------------------------------------------------------


------------------------------------------------------------------------
                                     Welfare plans that include health
                                                 benefits
                                 ---------------------------------------
                                                       Small, unfunded,
                                                          combination
                                                        unfunded/fully
                                         Large        insured, or funded
                                                      with a trust 5500-
                                                              SF
------------------------------------------------------------------------
Form 5500.......................  1 hr, 45 min......  1 hr, 14 min.
Sch A...........................  3 hr, 40 min......  2 hr, 43 min.
Sch C...........................  3 hr, 38 min......
Sch D...........................  1 hr, 52 min......  20 min.
Sch G...........................  11 hr, 0 min......
Sch H...........................  12 hr, 46 min.....
Sch I...........................  ..................  1 hr, 56 min.
Form 5500-SF....................  ..................  2 hr, 35 min.
------------------------------------------------------------------------


----------------------------------------------------------------------------------------------------------------
                                                   Welfare plans that do not include health benefits
                                      --------------------------------------------------------------------------
                                                                                         Small, filing Form 5500-
                                                Large           Small, filing Form 5500             SF
----------------------------------------------------------------------------------------------------------------
Form 5500............................  1 hr, 45 min...........  1 hr, 14 min...........
Sch A................................  3 hr, 40 min...........  2 hr, 43 min...........
Sch C................................  3 hr, 38 min...........
Sch D................................  1 hr, 52 min...........  20 min.................
Sch G................................  11 hr, 0 min...........
Sch H................................  12 hr, 46 min..........
Sch I................................  .......................  1 hr, 56 min...........
Form 5500-SF.........................  .......................  .......................  2 hr, 35 min.
Sch M1...............................  15 min.................
----------------------------------------------------------------------------------------------------------------


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--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  Direct filing entities
                                 -----------------------------------------------------------------------------------------------------------------------
                                     Master trusts           CCTs                PSAs             103-12 IEs             GIAs                DCGs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Form 5500.......................  1 hr, 50 min......  1 hr, 30 min......  1 hr, 23 min......  1 hr, 38 min......  1 hr, 26 min......  1 hr, 50 min.
Sch A...........................  2 hr, 54 min......  2 hr, 48 min......  2 hr, 46 min......  2 hr, 51 min......  3 hr, 1 min.......  2 hr, 52 min.
Sch C...........................  3 hr, 2 min.......  1 hr, 2 min.......  29 min............  1 hr, 56 min......  1 hr, 22 min......  2 hr, 42 min.
Sch D...........................  1 hr, 30 min......  48 min............  34 min............  1 hr, 1 min.......  54 min............  1 hr, 39 min.
Sch G...........................  12 hr, 34 min.....  ..................  ..................  8 hr, 3 min.......  ..................  11 hr, 6 min.
Sch H...........................  12 hr, 19 min.....  11 hr, 47 min.....  11 hr, 43 min.....  12 hr, 16 min.....  12 hr, 1 min......  8 hr, 36 min.
Sch DCG.........................  ..................  ..................  ..................  ..................  ..................  1 hr, 33 min.
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The aggregate hour burden for the Form 5500 Annual Return/Report 
(including schedules and short form) is estimated to be 0.9 million 
hours annually. The hour burden reflects filing activities carried out 
directly by filers. The cost burden is estimated to be $419 million 
annually. The cost burden reflects filing services purchased by filers. 
Presented below is a chart showing the total hour and cost burden of 
the revised Form 5500 Annual Return/Report separately allocated across 
the DOL and the IRS. There is no separate PBGC entry on the chart 
because, as explained below, its share of the paperwork burden is very 
small relative to that of the IRS and the DOL.

----------------------------------------------------------------------------------------------------------------
                                                           DOL                                IRS
                                           ---------------------------------------------------------------------
                                                 Hours            Costs             Hours            Costs
----------------------------------------------------------------------------------------------------------------
Pension:
    Large Plans...........................         261,464     $62,431,639.11         142,897     $31,568,313.36
    Small Plans...........................         174,999      87,694,622.39         176,481     103,113,327.32
Welfare:
    Large Plans...........................         108,142     111,593,190.83           9,953       1,811,627.38
    Small Plans...........................           6,137       5,407,649.86           2,507       1,252,295.71
Total:
    Large Plans...........................         369,607     174,024,829.94         152,850      33,379,940.74
    Small Plans...........................         181,136      93,102,272.24         178,988     104,365,623.03
    DFEs..................................          37,642       8,014,192.20          21,908       4,543,173.65
                                           ---------------------------------------------------------------------
        Total Plans.......................         588,385     275,141,294.38         353,746     142,288,737.43
----------------------------------------------------------------------------------------------------------------

    The paperwork burden allocated to the PBGC includes a portion of 
the general instructions, basic plan identification information, a 
portion of Schedule MB, a portion of Schedule SB, a portion of Schedule 
H, and a portion of Schedule R. The PBGC's Estimated Share of Total 
Form 5500 Annual Return/Report Burden is: 1,242 Hours and $1.6 million 
per year.
BILLING CODE 4510-29-P

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Statutory Authority

    Accordingly, pursuant to the authority in sections 101, 103, 104, 
109, 110 and 4065 of ERISA and sections 6058 and 6059 of the Code, the 
Form 5500 Annual Return/Report and the instructions thereto are 
proposed to be amended as set forth herein.

    Signed at Washington, DC,
Ali Khawar,
Acting Assistant Secretary, Employee Benefits Security Administration, 
U.S. Department of Labor.
Eric Slack,
Director, Employee Plans, Tax Exempt and Government Entities Division, 
Internal Revenue Service.
Gordon Hartogensis,
Director, Pension Benefit Guaranty Corporation.
[FR Doc. 2021-19714 Filed 9-14-21; 8:45 am]
BILLING CODE 4510-29-C


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