Annual Reporting and Disclosure

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

(h) Other FAA AD Provisions

The following provisions also apply to this

AD:

(1) Alternative Methods of Compliance

(AMOCs): The Manager, New York ACO

Branch, FAA, has the authority to approve

AMOCs for this AD, if requested using the

procedures found in 14 CFR 39.19. In

accordance with 14 CFR 39.19, send your

request to your principal inspector or

responsible Flight Standards Office, as

appropriate. If sending information directly

to the manager of the certification office,

send it to ATTN: Program Manager,

Continuing Operational Safety, FAA, New

York ACO Branch, 1600 Stewart Avenue,

Suite 410, Westbury, NY 11590; telephone

516–228–7300; fax 516–794–5531. Before

using any approved AMOC, notify your

appropriate principal inspector, or lacking a

principal inspector, the manager of the

responsible Flight Standards Office.

(2) Contacting the Manufacturer: For any

requirement in this AD to obtain instructions

from a manufacturer, the instructions must

be accomplished using a method approved

by the Manager, New York ACO Branch,

FAA; or Transport Canada Civil Aviation

(TCCA); or Bombardier, Inc.’s TCCA Design

Approval Organization (DAO). If approved by

the DAO, the approval must include the

DAO-authorized signature.

(i) Related Information

(1) Refer to Mandatory Continuing

Airworthiness Information (MCAI) TCCA AD

CF–2021–06, dated February 26, 2021, for

related information. This MCAI may be

found in the AD docket at https://

www.regulations.gov by searching for and

locating Docket No. FAA–2021–0787.

(2) For more information about this AD,

contact Chirayu Gupta, Aerospace Engineer,

Mechanical Systems and Administrative

Services Section, FAA, New York ACO

Branch, 1600 Stewart Avenue, Suite 410,

Westbury, NY 11590; telephone 516–228–

7300; fax 516–794–5531; email 9-avs-nyaco-

cos@faa.gov.

(3) For service information identified in

this AD, contact Bombardier, Inc., 200 Co

ˆte-

Vertu Road West, Dorval, Que

´bec H4S 2A3,

Canada; North America toll-free telephone 1–

866–538–1247 or direct-dial telephone 1–

514–855–2999; email ac.yul@

aero.bombardier.com; internet https://

www.bombardier.com. You may view this

service information at the FAA,

Airworthiness Products Section, Operational

Safety Branch, 2200 South 216th St., Des

Moines, WA. For information on the

availability of this material at the FAA, call

206–231–3195.

Issued on September 9, 2021.

Lance T. Gant,

Director, Compliance & Airworthiness

Division, Aircraft Certification Service.

[FR Doc. 2021–19814 Filed 9–14–21; 8:45 am]

BILLING CODE 4910–13–C

DEPARTMENT OF LABOR

Employee Benefits Security

Administration

29 CFR Part 2520

RIN 1210–AB97

Annual Reporting and Disclosure

AGENCY

: Employee Benefits Security

Administration, Labor.

ACTION

: Proposed rule.

SUMMARY

: This document contains

proposed amendments to Department of

Labor (DOL) regulations relating to

annual reporting requirements under

Title I of the Employee Retirement

Income Security Act of 1974, as

amended (ERISA). The proposed

amendments contained in this

document would conform these DOL

reporting regulations to proposed

revisions under Title I of ERISA and the

Internal Revenue Code (Code) to the

Form 5500 Annual Return/Report of

Employee Benefit Plan and Form 5500–

SF Short Form Annual Return/Report of

Small Employee Benefit Plan being

published in this issue of the Federal

Register in a separate Notice of

Proposed Forms Revisions (NPFR)

prepared jointly by DOL, the Internal

Revenue Service (IRS), and the Pension

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Bombardier

Airplane

AFMTitle

AFM Revision

Model/Serial

Number

Sub-sub section B., Wing Anti-ice System,

of

sub-section 4., Operation in Icing Conditions,

CL-600-2B 16

of

Section 02-04, Operating Limitations,

~f

Revision 54,

Chapter 2

-LIMITATIONS;

and sub-sectl~n dated

(Variant 604) 5701 M., Icing Conditions During Flight,

of

Sect10n December 18, through 5988 04-14 Ice and Rain Protection,

of

Chapter 4 - 2019 inclusive NORMAL PROCEDURES;

of

Bombardier

Challenger 605 CL-600-2B 16 AFM,

PSP

605-1

Sub-sub section B., Wing Anti-ice System,

of

sub-section 4., Operation in Icing Conditions,

CL-600-2B 16

of

Section 02-04, Operating Limitations,

~f

Revision 19,

Chapter 2 - LIMITATIONS;

~d

sub-sectl~n dated

(Variant 604) 6050 M., Icing Conditions During Fhght,

of

Sect10n December 18, through 6153 04-14 Ice and Rain Protection,

of

Chapter 4 - 2019 inclusive NORMAL PROCEDURES;

of

Bombardier

Challenger 650 CL-600-2B16 AFM,

PSP

650-1

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1

References to the ‘‘Form 5500 Annual Return/

Report’’ may include depending on the context, the

Form 5500, the Form 5500–SF, and the Form 5500–

EZ, Annual Return of One Participant (Owners and

Their Spouses) Retirement Plan (Form 5500–EZ).

The Form 5500–EZ is a return that is required only

to satisfy the Code. Form 5500–EZ filers are not

subject to Title I of ERISA.

2

Estimates are based on 2019 Form 5500 filings.

DOL notes that welfare plans with less than 100

participants that are unfunded or insured (do not

hold assets in trust) are generally exempt from filing

a Form 5500. 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.

Benefit Guaranty Corporation (PBGC)

(collectively ‘‘Agencies’’). Those

proposed form changes and these

proposed regulatory amendments

primarily implement statutory changes

enacted as part of the Setting Every

Community Up for Retirement

Enhancement Act of 2019 (SECURE

Act). Conforming changes also are being

proposed to the requirements for the

summary annual report. The proposed

regulatory amendments 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

:

Comment due date: Comments are

due on or before November 1, 2021.

Proposed applicability dates: If

adopted, the proposed regulatory

amendments to implement the SECURE

Act’s amendment of section 103(g)

would apply to 2021 plan year

reporting. All other proposed regulatory

amendments would apply to reporting

for plan years beginning on or after

January 1, 2022.

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.

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 Revision of

Annual Information Return/Reports RIN

1210–AB97.

Instructions: All submissions must

include the agency name and Regulatory

Identifier Number (RIN) for this

rulemaking. The DOL will share any

comment submitted in response to this

regulatory proposal with the IRS and the

PBGC. To avoid unnecessary

duplication of effort, the Agencies also

will treat public comments submitted in

response to this notice of proposed

rulemaking as public comments on the

Notice of Proposed Forms Revisions 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

(this is not a toll-free number), for

questions related to these proposed

amendments to the DOL regulations.

Customer service information:

Individuals interested in obtaining

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

:

A. Legislative and Regulatory Reporting

Framework

Titles I and IV of ERISA and the

Internal Revenue Code (Code), generally

require pension and other employee

benefit plans to file annual returns/

reports concerning, among other things,

the financial condition and operations

of the plan. Filing a Form 5500 Annual

Return/Report of Employee Benefit Plan

(Form 5500) or, if eligible, a Form 5500–

SF Short Form Annual Return/Report of

Small Employee Benefit Plan (Form

5500–SF), together with any required

schedules and attachments (together

‘‘the Form 5500 Annual Return/

Report’’),

1

in accordance with their

instructions, generally satisfies these

annual reporting requirements.

ERISA section 103 broadly sets out

annual financial reporting requirements

for employee benefit plans under Title

I of ERISA. The Form 5500 Annual

Return/Report for Title I purposes is

promulgated pursuant to DOL

regulations under the ERISA provisions

authorizing limited exemptions 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 Form 5500

Annual Return/Report, and related

instructions and regulations, are also

promulgated under the DOL’s general

regulatory authority in ERISA sections

109 and 505.

In addition to being an important

disclosure document for plan

participants and beneficiaries, the Form

5500 Annual Return/Report is a critical

enforcement, compliance, and research

tool for the DOL, the Internal Revenue

Service (IRS), and the Pension Benefit

Guaranty Corporation (PBGC) (together

‘‘Agencies’’). The Form 5500 Annual

Return/Report 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. In the United States, there are

an estimated 2.5 million health plans,

an estimated 885,000 other welfare

plans, and nearly 772,000 private

pension plans. These plans cover

roughly 154 million private sector

workers, retirees, and dependents, and

have estimated assets of $12.2 trillion.

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.

2

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 the primary means for

monitoring the operations of plans by

participating employers in multiple

employer plans and other group

arrangements, plan participants and

beneficiaries, and by the public.

The forms, schedules, and

instructions, also serve to help the DOL

carry out its statutory directives under

sections 506 and 513 of ERISA.

Specifically, section 506(a) of ERISA

authorizes the Secretary of Labor to

coordinate with other Agencies to avoid

unnecessary expense and duplication of

functions among Government agencies.

The Agencies designed the Form 5500

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The SECURE Act was enacted on December 20,

2019, as Division O of the Further Consolidated

Appropriations Act, 2020 (Pub. L. 116–94).

4

See NPFR for detailed discussion of the

proposed Schedule MEP and Schedule DCG.

Annual Return/Report so that it could

be used simultaneously to satisfy annual

return/report requirements to the

Agencies, and to help the Agencies

more effectively and efficiently (from

both the public’s and the Agencies’

perspectives) provide oversight, assist

with compliance, and enforce the

provisions of ERISA and the Code.

Section 506(b) gives the DOL

responsibility for detecting and

investigating civil and criminal

violations of Title I of ERISA. The Form

5500 Annual Return/Report is one of the

important tools the DOL uses to carry

out its responsibility to detect and

investigate such violations. Section

513(b)(2) of ERISA specifically directs

DOL to undertake research studies

relating to pension plans, including but

not limited to (A) the effects of this

subchapter upon the provisions and

costs of pension plans, (B) the role of

private pensions in meeting the

economic security needs of the nation,

and (C) the operation of private pension

plans including types and levels of

benefits, degree of reciprocity or

portability, and financial and actuarial

characteristics and practices, and

methods of encouraging the growth of

the private pension system.

Recent legislative and regulatory

changes affecting multiple employer

pension plans (MEPs) and similar

arrangements are spurring the current

need to update the Form 5500 Annual

Return/Report and related regulations.

Specifically, as discussed in more detail

in the NPFR, the Setting Every

Community Up for Retirement

Enhancement Act of 2019 (SECURE

Act),

3

included various provisions

designed to improve the private

employer-based retirement system.

Among other things, the SECURE Act

included changes designed to simplify

retirement plan administration for

certain eligible defined contribution

plans and added provisions to the Code

relating to MEPs, including MEPs with

pooled plan providers, and adopted

provisions under Title I of ERISA that

designated these MEPs with pooled plan

providers as pooled employer plans.

The NPFR published concurrently in

this issue of the Federal Register sets

forth a discussion of form and

instruction changes that relate to these

proposed regulations. These proposed

revisions to the DOL’s reporting

regulations are needed for the DOL to

implement the forms revisions proposed

in the three-agency (DOL, IRS, and

PBGC) Notice of Proposed Forms

Revisions (NPFR).

B. Discussion of the Proposed Revisions

to 29 CFR Part 2520

1. Section 2520.103–1(a)(2)

Section 2520.103–1 generally

describes the content of the Form 5500

Annual Return/Report as a limited

exemption and alternative method of

compliance for ERISA-covered

employee benefit plans to satisfy annual

reporting requirements under Title I.

The proposal adds a reference to

‘‘section 202 of the SECURE Act’’ to

paragraph (a)(2) of § 2520.103–1 to set

forth the authority for prescribing a

consolidated report alternative method

of compliance for certain groups of

defined contribution retirement plans

under proposed §§ 2520.103–14 and

2520.104–51, discussed below, relating

to defined contribution group (DCG)

reporting arrangements.

2. Sections 2520.103–1(b)(1) and

2520.103–1(c)(1)

Paragraphs (b) and (c) of § 2520.103–

1 generally describes the contents of the

annual report for large plans (generally

those with 100 or more participants)

and small plans (generally those with

fewer than 100 participants). The

proposal would amend § 2520.103–

1(b)(1) to add a proposed multiple

employer plan (MEP) schedule (titled

Schedule MEP) to the list of schedules

and attachments required to be included

with the Form 5500 for large MEPs. A

parallel update is being proposed to

§ 2520.103–1(c)(1) to add the Schedule

MEP as a schedule that small MEPs

must include with the Form 5500.

4

2. Section 2520.103–1(c)(2)(ii)

Paragraph (c) of § 2520.103–1

describes the conditions under which

an eligible small plan (generally with

fewer than 100 participants) may file the

Form 5500–SF. The proposal would add

§ 2520.103–1(c)(2)(ii)(F) to state that

MEPs, which include pooled employer

plans, as well as MEPs described in the

DOL’s regulation at § 2510.3–55

(association retirement plans and

professional employer organization

(PEO) MEPs), are not permitted to use

the Form 5500–SF regardless of whether

the plan meets the size and other

requirements for filing a Form 5500–SF.

A similar prohibition applies under the

current regulation to MEWA plans

required to file the Form M–1 and to

multiemployer plans. The proposal

would also add a new § 2520.103–

1(c)(2)(ii)(G) to provide a similar

prohibition on filing the Form 5500–SF

for DCG reporting arrangements. As

described below in proposed

§§ 2510.103–14 and 104–51, DCG

reporting arrangements must file the

aggregated annual report for

participating plans using the Form 5500,

including the schedules and

attachments that are generally required

for large retirement plans and Direct

Filing Entities (DFEs) as well as a

Schedule DCG (Individual Plan

Information) for each plan whose

reporting obligation is being satisfied by

the DCG filing.

3. Amendments to § 2520.103–10

Section 2520.103–10 identifies

financial schedules that are required to

be included as part of the Form 5500

Annual Return/Report depending on the

characteristics and operations of the

plan. The listed schedules include the

‘‘Schedule of Assets Held for

Investment’’ and ‘‘Schedule of Assets

Acquired and Disposed within the Plan

Year.’’ Paragraph (b) of § 2520.103–10

sets forth the content requirements for

these schedules. The NPFR being

published concurrently with this NPRM

includes proposed additions and

clarifications to the content of the

‘‘Schedules of Assets Held for

Investment’’ and the ‘‘Schedule of

Assets Acquired and Disposed within

the Plan Year’’ that are designed to

improve the consistency, transparency,

and usability of the information

reported regarding plan investments.

The proposed changes to the contents

and format of the schedule are described

in detail in the NPFR and also set forth

in the proposed amendment to the

regulatory text in paragraph (b)(1)(i) of

§ 2520.103–10. Currently, filers

typically file the schedule as a PDF. Of

particular note, the proposal specifies

that the schedules would have to be

filed electronically through the ERISA

Filing Acceptance System II (EFAST2)

electronic filing system in a structured

format in accordance with the EFAST2

requirements and the Form 5500’s

instructions.

4. New §§ 2520.103–14, 2520.104–51

and 2520.104a–9—Consolidated Form

5500 as an Alternative Method of

Compliance for Plans Participating in a

DCG Reporting Arrangement

The proposal would amend the ERISA

annual reporting regulations to

implement the SECURE Act section 202

directive to the Secretary of Labor to

jointly with the Secretary of the

Treasury provide for a single, aggregated

Form 5500 option that would satisfy the

annual reporting obligations for the

defined contribution pension plans

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The proposal is modeled to some extent on the

existing annual reporting rules for fully insured

welfare benefit plans that participate in a group

insurance arrangement (GIA) and for investment

entities that file as a Direct Filing Entity. See 29

CFR 2520.103–2, 2520.103–12, 2520.104–21, and

2520.104–43.

6

See NPFR for detailed description of the

proposed Schedule DCG. A separate Schedule DCG

would be required for each individual participating

plan. In the case of an existing plan that joins a DCG

filing arrangement, the identifying information

regarding the plan and employer/plan sponsor that

was used in prior filings for the plan must be used

to identify the plan and the employer/plan sponsor

on the Schedule DCG for the plan.

7

See NPFR for a more detailed discussion of the

content requirements for DCG Form 5500.

participating in the group. Under the

proposal, several conditions relating to

the DCG reporting arrangement, the

participating plans, and the content of

the Form 5500 filing would have to be

satisfied before the aggregated filing

would satisfy the annual reporting

requirements of the separate

participating plans. The NPFR describes

those conditions in detail. The

conditions also are set forth in a

proposed new 29 CFR 2520.103–14 and

2520.104–51.

5

With respect to the content

requirements for a DCG consolidated

Form 5500 filing, proposed paragraph

(b) of § 2520.103–14 provides that the

consolidated DCG report would be

required to include a Form 5500

‘‘Annual Return/Report of Employee

Benefit Plan’’ and various statements or

schedules based on the characteristics

and operations of the participating

plans, 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),

6

supplemental schedules referred to in

29 CFR 2520.103–10 with information

aggregated for all the participating

plans, the report and opinion of an

independent qualified public

accountant (IQPA) for the DCG trust,

and an IQPA report and opinion for any

individual participating plans with 100

or more participants that would be

subject to the audit requirement if filing

a separate Form 5500. This would

include separate financial statements, if

such financial statements are prepared

in order for the independent qualified

public accountant to form the required

opinions on the DCG trust required

under the proposal and the individual

participating large plans required by

section 103(a)(3)(A) of the Act and

§ 2520.103–2(b)(5).

7

Proposed paragraph (d) would make

clear that the DCG reporting

arrangement must comply with the

electronic filing requirements that apply

to all plan filers and direct filing entities

(DFE). See § 2520.104a–2 and the

instructions for the Form 5500 Annual

Return/Report for electronic filing

requirements. In addition, the proposed

paragraph emphasizes that the common

plan administrator of all the

participating plans that is filing the

consolidated Form 5500 must maintain

an original copy, with all required

signatures, as part of its records (which

also would be treated as records of each

of the participating plans).

The proposed new § 2520.104–51

would authorize the DCG consolidated

report as an alternative method of

compliance under ERISA section 110 for

defined contribution pension plans that

participate in DCG reporting

arrangements. Specifically, filing of a

complete and accurate consolidated

Form 5500 for the DCG reporting

arrangement would relieve the

administrator of each individual

participating defined contribution

pension plan that meets the

requirements of paragraph (b) of

§ 2520.104–51 of the obligation to file an

individual annual report under Title I of

ERISA. This alternative method of

compliance would be available only for

a defined contribution pension plan in

a plan year in which (i) such plan

participates in a DCG reporting

arrangement that meets the conditions

of paragraph (c) of this proposed

§ 2520.104–51; and (ii) the DCG

reporting arrangement has filed with the

Secretary of Labor in accordance with

proposed § 2520.104a–9, a complete and

accurate consolidated annual report that

meets the content requirements under

proposed § 2520.103–14. To make clear

that the DCG reporting arrangement is a

direct filing entity (DFE) that is

submitting the aggregated Form 5500 on

behalf of the participating plans,

proposed § 2520.104–51(b)(2) provides

that that the term ‘‘DCG reporting

arrangement’’ shall be used in place of

the term ‘‘plan’’ where it appears in

§§ 2520.103–3, 2520.103–4, 2520.103–6,

2520.103–8, 2520.103–9, and 2520.103–

10 and elsewhere in subparts C and D

of 29 CFR part 2520, as applicable.

Proposed § 2520.104–51 would also

provide that the reporting relief for

individual plans would apply only if all

plans participating in the DCG reporting

arrangement (i) are individual account

plans or defined contribution plans; (ii)

have—(A) the same trustee (‘‘common

trustee’’) and same trust holding the

assets of the participating plans

(‘‘common trust’’); (B) the same one or

more named fiduciaries, except 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 (‘‘common named fiduciaries’’);

(C) a designated administrator that is the

same plan administrator for all the

participating plans (‘‘common plan

administrator’’); (D) plan years

beginning on the same date (‘‘common

plan year’’); (iii) provide the same

investments or investment options to

participants and beneficiaries

(‘‘common investments or investment

options’’); (iv) have the investment

assets held in a single trust of the DCG

reporting arrangement; (v) not hold any

employer securities; (vi) 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; (vii) 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; and

(viii) may not be a multiemployer plan

or a MEP (including association

retirement plans, pooled employer plans

and professional employer organization

plans (PEO plans)).

Proposed § 2520.104–51 would also

expressly state that the alternative

method of complying with the Title I

annual reporting requirements would

not relieve the administrator of the

individual participating plans from any

other requirement of Title I of the Act,

including, for example, the provisions

that require that plan administrators

furnish copies of the summary plan

description to participants and

beneficiaries (ERISA section 104(b)(1)),

furnish certain documents to the

Secretary of Labor upon request (ERISA

section 104(a)(6)), and furnish a copy of

a Summary Annual Report (SAR) to

participants and beneficiaries of the

plan (ERISA section 104(b)(3)).

Proposed § 2520.104–51(c)(2)(iii)

provides that all plans participating in

a DCG reporting arrangement must have

a designated common plan

administrator that is the same plan

administrator for all the participating

plans. The SECURE Act was not explicit

on whether this was intended to require

the same person to be the plan

administrator under ERISA section

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Under the somewhat similar consolidated

reporting provisions applicable to GIAs, the GIA is

permitted to use the IRS Form 5558 to apply for an

extension of time the GIA consolidated report on

behalf of the plans participating in the GIA.

9

Regulatory Planning and Review, 58 FR 51735

(Oct. 4, 1993).

10

Improving Regulation and Regulatory Review,

76 FR 3821 (Jan. 18, 2011).

11

44 U.S.C. 3506(c)(2)(A) (1995).

12

5 U.S.C. 601 et seq. (1980).

13

2 U.S.C. 1501 et seq. (1995).

14

Federalism, 64 FR 153 (Aug. 4, 1999).

15

5 U.S.C. 804(2) (1996).

3(16)(A) for the purpose of meeting the

annual reporting requirements for each

participating plan or was intended to

require that the same person be the plan

administrator of each participating plan

for all purposes under ERISA. The

proposal requires that the same person

sign the DCG filing as the plan

administrator for each participating

plan. The Department solicits comments

on whether the final rule should address

whether individual plans participating

in a DCG may have a separate statutory

administrator responsible for other

duties ERISA assigns to the plan

administrator (e.g., distribution of

summary plan descriptions).

Finally, proposed new § 2520.104a–9

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 at § 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.

8

As noted above, section 110 of ERISA

permits the DOL to prescribe for

pension plans alternative methods of

complying with any of the reporting and

disclosure requirements if the Secretary

finds that: (1) The use of the alternative

method is consistent with the purposes

of ERISA and it provides adequate

disclosure to plan participants and

beneficiaries, and adequate reporting to

the Secretary; (2) application of the

statutory reporting and disclosure

requirements would increase costs to

the plan or impose unreasonable

administrative burdens with respect to

the operation of the plan; and (3) the

application of the statutory reporting

and disclosure requirements would be

adverse to the interests of plan

participants in the aggregate. The DOL

believes that the proposal on DCG

reporting arrangements meets those

conditions, especially given the

statutory direction in the SECURE Act

to create such a reporting option, but

also specifically solicits comments on

the required findings under section 110.

As also discussed in the NPFR, the

DOL expects that cost savings for plans

relying on a DCG filing compared to

plans filing separately will generally

require the DCG to collectively exceed

an aggregate participant count of 100

participants. In other words, the DOL

does not expect a DCG filing to provide

meaningful cost savings for plans

compared to filing their own annual

report in the case of DCG arrangements

with an aggregate participant count of

under 100 participants. Rather, we

expect in such cases that the individual

plans would likely qualify for filing the

Form 5500–SF and that they will likely

find it more cost effective to file their

own separate Form 5500–SF.

Accordingly, this proposal does not

include an option under which such a

‘‘small’’ DCG could file as a small plan.

Nonetheless, the DOL solicits comments

regarding the merit of those

expectations and assumption and

whether the rules should provide a

simplified reporting option for ‘‘small’’

DCG reporting arrangements.

5. Section 2520.104b–10

Section 2520.104b–10 sets forth the

requirements for the Summary Annual

Report (SAR) appendix and prescribes

formats for such reports. The DOL

proposes updating this section to reflect

the new filing option for DCG reporting

arrangements and the addition of the

new Schedule MEP and Schedule DCG

to the 5500 Annual Report/Return. The

proposal includes adding to the existing

model language in the DOL’s regulation

new text that plans would use to

provide a brief description of the plan

based on the plan characteristic codes

listed for the plan on the Form 5500,

including whether it is a defined

contribution or defined benefit plan,

and whether the plan is a pooled

employer plan, another type of multiple

employer plan, a single employer plan,

or a plan participating in a DCG

reporting arrangement, respectively. The

proposed new regulatory language also

includes text for plans to use that states

a copy of the Schedule DCG and the

Schedule MEP are available on request,

as applicable. For plans participating in

a DCG reporting arrangement, the new

language advises that a statement of the

aggregate assets and liabilities of all the

plans in the DCG reporting arrangement

and accompanying notes, a statement of

aggregate income and expenses of the

DCG reporting arrangement and

accompanying notes, and a copy of the

audit report filed for the trust of the

DCG reporting arrangement are available

on request. Finally, the new SAR

language would state that a copy of the

Form 5500 annual report filed for the

plan or DCG is available online from

EBSA via a DOL website at

www.efast.dol.gov.

C. Applicability Dates

If adopted, the proposed amendments

to implement the SECURE Act’s

amendment of section 103(g) would

apply to reporting for plan years

beginning on or after January 1, 2021.

The other proposed rules, including

those under section 202 of the SECURE

Act and structuring the schedules of

assets held for investment, generally

would apply to reporting for plan years

beginning on or after January 1, 2022.

The NPFR published concurrently in

this issue of the Federal Register sets

forth a comprehensive discussion of

form and instruction changes that relate

to these proposed regulations.

D. Regulatory Impact Analysis

The following is a discussion of the

DOL’s examination of the effects of this

rule as required by Executive Order

12866,

9

Executive Order 13563,

10

the

Paperwork Reduction Act of 1995,

11

the

Regulatory Flexibility Act,

12

section 202

of the Unfunded Mandates Reform Act

of 1995,

13

Executive Order 13132,

14

and

the Congressional Review Act.

15

1.1. Executive Orders

Executive Orders 12866 and 13563

direct agencies to assess all costs and

benefits of available regulatory

alternatives and, if regulation is

necessary, select regulatory approaches

that maximize net benefits (including

potential economic, environmental,

public health and safety effects;

distributive impacts; and equity).

Executive Order 13563 emphasizes the

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16

Regulatory Planning and Review, 58 FR 51735

(Oct. 4, 1993).

17

In 2019, the plans required to file the Form

5500 included any benefit plan or a welfare benefit

plan that covered 100 or more participants as of the

beginning of the plan year and a Form 5500 filed

for a master trust investment account (MTIA),

common/collective trust (CCT), pooled separate

account (PSA), 103–12 investment entity (103–12

IE), or GIA. However, fully insured, unfunded, or

a combination of unfunded/insured welfare plans

and fully insured pension plans that meet the

Continued

importance of quantifying costs and

benefits, reducing costs, harmonizing

rules, and promoting flexibility.

Under Executive Order 12866,

‘‘significant’’ regulatory actions are

subject to review by the Office of

Management and Budget (OMB).

16

Section 3(f) of the Executive order

defines a ‘‘significant regulatory action’’

as an action that is likely to result in a

rule (1) having an annual effect on the

economy of $100 million or more, or

adversely and materially affecting a

sector of the economy, productivity,

competition, jobs, the environment,

public health or safety, or state, local, or

tribal governments or communities (also

referred to as ‘‘economically

significant’’); (2) creating a serious

inconsistency or otherwise interfering

with an action taken or planned by

another agency; (3) materially altering

the budgetary impacts of entitlement

grants, user fees, or loan programs or the

rights and obligations of recipients

thereof; or (4) raising novel legal or

policy issues arising out of legal

mandates, the President’s priorities, or

the principles set forth in the Executive

order.

A full regulatory impact analysis must

be prepared for major rules with

economically significant effects (for

example, $100 million or more in any 1

year), and the Office of Management and

Budget (OMB) reviews ‘‘significant’’

regulatory actions. It has been

determined that this rule is not

economically significant within the

meaning of section 3(f)(1) of the

Executive order. Pursuant to the terms

of the Executive order, OMB has

determined, however, that this action is

‘‘significant’’ within the meaning of

section 3(f)(4) of the Executive order.

Therefore, the DOL has provided an

assessment of the potential costs,

benefits, and transfers associated with

this proposed rule. In accordance with

the provisions of Executive Order

12866, this proposed rule was reviewed

by OMB. Pursuant to the Congressional

Review Act, OMB has designated this

proposed rule as not a ‘‘major rule,’’ as

defined by 5 U.S.C. 804(2).

1.2. Introduction and Need for

Regulation

The Form 5500 Annual Return/Report

is the principal source of information

and data available to the Agencies

concerning the operations, funding, and

investments of pension and welfare

benefit plans covered by ERISA and the

Code. Accordingly, the Form 5500

Annual Return/Report is essential to

each Agency’s enforcement, research,

and policy formulation programs and is

a 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 the primary means

by which the operations of plans can be

monitored by plan participants and

beneficiaries and the general public.

As discussed earlier in this document

and the related NPFR publishing

concurrently with this proposal, the

SECURE Act included various

provisions designed to improve the

private employer-based retirement

system by seeking to make it easier for

businesses to offer retirement plans, and

for individuals to save for retirement,

through the creation of new plan

structure and reporting options. These

new structures will require new annual

reporting, which has resulted in the

need to update the Form 5500 Annual

Return/Report and related regulations.

Pooled Employer Plans and Other

MEPs: The SECURE Act amended

ERISA and the Code to address certain

MEPs administered by pooled plan

providers. Under section 3(43) of ERISA

such plans are called pooled employer

plans. The proposed regulation would

add a new Schedule MEP to the Form

5500 annual report to collect

information on employers participating

in MEPs and to gather compliance

information on pooled employer plans.

Some of the information on the

proposed Schedule MEP is currently

reported on the Form 5500 Annual

Return/Report by MEPs, but it is

reported on a nonstandard attachment.

Only an image or picture of the

attachment is available through the

EFAST2 public disclosure function.

Making the information data-capturable

by including it on the proposed

Schedule MEP would improve the

uniformity and accuracy of the data and

increase its usability.

‘‘Defined Contribution Group (DCG)

Reporting Arrangement’’: Section 202 of

the SECURE Act directs the Secretary of

the Treasury and the Secretary of Labor

(together ‘‘Secretaries’’) to modify the

returns required under section 6058 of

the Code and the reports required by

section 104 of the ERISA, respectively,

so that all members of a group of

defined contribution individual account

plans that meet certain conditions may

file a single aggregated annual return/

report satisfying the requirements of

both such sections. The SECURE Act

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,

must have the same trustee, the same

named fiduciaries, the same

administrator, plans years beginning on

the same date, and must provide the

same investments or investment options

to participants and beneficiaries. The

proposed rule would establish the

conditions, including the SECURE Act

conditions, under which filing a single,

aggregated Form 5500 Annual Return/

Report by a ‘‘defined contribution group

(DCG) reporting arrangement’’ would

satisfy the individual, annual reporting

obligations for each of the plans

participating in the group. As discussed

in more detail in the NPFR, the

proposed rule also includes adding a

new Schedule DCG (Individual Plan

Information) to provide individual plan-

level information for plans covered by a

DCG consolidated Form 5500 filing.

In addition, although not directly

implementing SECURE Act changes,

some of the changes being proposed in

this document are intended to ensure

that annual reporting by pooled

employer plans, other MEPs, and DCGs

provides appropriate financial and

operational transparency and

accountability. Certain proposed

changes would benefit workers in plans

other than pooled employer plans and

DCGs would apply more broadly, e.g.,

improving the quality of financial

reporting. Other changes being proposed

relate to efforts to improve compliance

and oversight with respect to the Code

issues and defined benefit plans subject

to the PBGC insurance program under

Title IV of ERISA.

Schedule H, Schedule of Assets Held

for Investment, and Schedule of Assets

Acquired and Disposed of Within the

Year: As discussed in the NPFR, the

Agencies are proposing structural, data

element, and instruction changes to the

current Schedule H, Line 4i Schedules

of Assets. Current Line 4i would be

broken into two items to identify the

existing schedules separately: Line 4i(1)

would identify the Schedule of Assets

Held for Investment at End of Year, and

Line 4i(2) would identify the Schedule

of Assets Acquired and Disposed of

Within Year (together ‘‘Schedules of

Assets’’). The current regulations and

instructions require most large plans

and DFEs to attach the Schedules of

Assets to the Form 5500, Schedule H.

17

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requirements of 29 CFR 2520.104–44 are exempt. If

a Schedule I was filed for the plan for the 2018 plan

year or a Form 5500–SF and the plan covered fewer

than 121 participants as of the beginning of the

2019 plan year, the Schedule I may be completed

instead of a Schedule H. Plans that file a Form

5500–SF for the 2019 plan year are not required to

file a Schedule H for that year.

18

Private Pensions: Targeted Revisions Could

Improve Usefulness of Form 5500 Information, at

17.

19

Id.

20

See EBSA Needs to Provide Additional

Guidance and Oversight to ERISA Plans Holding

Hard-to-Value Alternative Investments at 17,

September 30, 2013. https://www.oig.dol.gov/

public/reports/oa/2013/09-13-001-12-121.pdf;

Private Pensions: Targeted Revisions Could

Improve Usefulness of Form 5500 Information, at

37. June 5, 2014. https://www.gao.gov/products/

gao-14-441.

21

See August 23, 2010 Comment Letter from

Ryan Alfred, President, BrightScope, Inc. Re:

Proposed Extension of Information Collection, Form

5500 http://www.reginfo.gov/public/do/

PRAViewDocument?ref_nbr=201009-1210-002).

22

PGBC 2018 Pension Insurance Data Tables.

https://www.pbgc.gov/sites/default/files/2018_

pension_data_tables.pdf.

They are the only place on the Form

5500 Annual Return/Report where plans

are required to list individual plan

investments identified by major

characteristics, such as issue, maturity

date, interest rate, cost and current

value. As such, they are the only part of

the Form 5500 Annual Return/Report

useful to evaluate the year-to-year

performance, liquidity, and risk

characteristics of a plan’s individual

investments.

The current reported information

suffers from several shortcomings. First,

filers currently submit this information

as non-standard attachments to filers’

electronic Form 5500 Annual Return/

Report filings, so only an image or

picture of the attachments is available

through the EFAST2 public disclosure

function. A survey panel of plan

sponsors, service providers,

representatives of plan participants, and

researchers was conducted in 2014 as

part of a Government Accountability

Office (GAO) report; 11 of 31

respondents indicated that having no

standard reporting format was a very or

extremely significant challenge. GAO

reported that attachments to the form

may be as long as 400 pages, making it

particularly difficult for users to find

information.

18

Second, filers do not

always provide the Line 4i Schedules of

Assets in the same place in each annual

return/report. For example, the Line 4i

Schedules of Assets are often

incorporated in the larger audit report of

the plan’s IQPA that itself is filed as a

nonstandard attachment to the Form

5500 Annual Return/Report. Third, the

schedules do not require a standardized

method for identifying and describing

assets on the Line 4i Schedules.

Different filings may identify the same

stock or mutual fund with various

different names or abbreviations. In the

aforementioned GAO survey, most

researchers indicated that a lack of a

standard reporting format or unique

identifier for plan assets was a major

challenge, while representatives of plan

sponsors and service providers did

not.

19

Data capturability of the Line 4i

Schedules of Assets would make it

much easier and more efficient to

monitor plan holdings as computer

programs can read and analyze the data

much more efficiently. Currently,

entities expend considerable resources

collecting the data and presenting it in

a usable format, to which they then sell

access. Making the information data

capturable at the submission stage of the

process would be more cost effective as

it removes the need for a second entity

to gather the information, and allow

more entities access to the data at a

lower overall cost. The DOL’s Office of

Inspector General (‘‘DOL–OIG’’) and the

GAO have both recommended that

EBSA implement changes to create more

detailed and structured Schedules of

Assets.

20

It would also allow the

Agencies and the interested public,

including the participants and

beneficiaries in impacted plans, to

better monitor a larger number of

pension plans and their asset

allocations. A number of private entities

have been using the information

reported on Line 4i Schedule of Assets

Held for Investment in larger pension

plan Form 5500 Annual Return/Report

filings into data-capturable information

and have been using it to compare plan

investment menus and investment

allocations. The DOL believes this

development is evidence that plans

sponsors and their service providers are

interested in having access to these data.

For example, one company that uses the

Schedules of Assets data sent a letter to

DOL stating that they believe that the

information on the Form 5500 Annual

Return/Report is very useful in ‘‘helping

the agency understand the performance

and design of retirement plans in the

market place’’ and that the data

availability fosters ‘‘third party data

collection and evaluation efforts that in

turn help protect retirement plan

participants.’’

21

Plan sponsors can use

this information to see better how their

investment menus compare to similarly

situated plans and service providers use

this information to identify plans with

underperforming investments in order

to attract new business. This can lead to

more competition and improved plan

performance, which would ultimately

benefit plan participants and

beneficiaries.

Defined Benefit Pension Plan/ERISA

Title IV Additions: The Form 5500

collects information from defined

benefit pension plans in Schedules MB,

SB, and R. The PBGC has determined

that it needs more detail in these

schedules accurately to project defined

benefit pension plan and PBGC

insurance program liabilities. The

PBGC’s proposed changes to the

information required to be reported by

PBGC-insured defined benefit plans

would remedy the deficiencies of the

current Form 5500 filings and better

protect participants. There are 23,371

single employer defined benefit plans

and 1,373 multiemployer defined

benefit plans that are covered by the

PBGC and would be impacted by these

changes.

22

Internal Revenue Code Compliance

Additions: 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. At that

time 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. The lack of

information from these schedules has

negatively impacted the IRS’s ability to

focus effectively on specific factors of

noncompliance when selecting

retirement plans for examination. Rather

than reinstating the Schedules E, P, and

T, the IRS is proposing to add new

questions to the 2022 Form 5500

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,

IRS is proposing to add a question that

would help it identify whether adopters

of pre-approved plans have been

updated timely for changes in the law.

Affected Entities

Major portions of this proposal relate

to SECURE Act statutory changes that

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Employee Benefits Security Administration.

‘‘Private Pension Plan Bulletin, Abstract of 2018

Form 5500 Annual Report.’’ (2020). The 2018 Form

5500 data set is the most recent available because

Form 5500 filings for the 2018 reporting year

generally are not required to be filed for calendar

year plans until July through October of 2019, and

the deadline for fiscal year plans may extend well

into 2020. The User Guide for the 2018 Form 5500

Private Pension Plan Research File includes a

discussion of the creation of the annual data set and

timing of data extraction. See www.dol.gov/sites/

dolgov/files/EBSA/researchers/data/retirement/

pension-user-guide-2018.pdf (Accessed July 21,

2021).

24

Id.

25

See, e.g., 2020 Form 5500 instructions at 14.

26

Employee Benefits Security Administration.

‘‘Private Pension Plan Bulletin, Abstract of 2018

Form 5500 Annual Reports.’’ (June 2020).

27

National Association of Professional Employee

Organizations, Industry Statistics (Accessed 6/28/

2021), https://www.napeo.org/what-is-a-peo/about-

the-peo-industry/industry-statistics. NAPEO had

previously reported 904 PEOs but revised its

methodology. An explanation of the revision is

included on the NAPEO website. See The PEO

Industry Footprint 2021, Laurie Bassi and Dan

McMurrer, McBassi & Company at page 4 (May

2021) (available at www.napeo.org/docs/default-

source/white-papers/2021-white-paper-

final.pdf?sfvrsn=6dde35d4_2.

28

85 FR 72934, 72949 (Nov. 16, 2016).

29

Department of Labor. Form PR. https://

www.dol.gov/agencies/ebsa/employers-and-

advisers/plan-administration-and-compliance/

reporting-and-filing/form-pr.

(1) recognized a new type of multiple

employer plan under Title I of ERISA

called pooled employer plans; and (2)

called for the Secretaries to establish a

new consolidated annual report for

certain groups of defined contribution

pension plans (herein called DCG

reporting arrangements). The SECURE

Act amendments first authorized pooled

employer plans to begin operating

beginning on January 1, 2021; even early

adopted pooled employer plans

generally will not file a Form 5500

before July 2022. Similarly, DCG

reporting arrangements are a new filing

option starting with the 2022 plan year;

such consolidated filings will not begin

until July 2023. Thus, there is no

historical Form 5500 information that

the DOL can use reliably to evaluate the

number of affected entities. As a result,

there is significant uncertainty regarding

the DOL’s ability to measure costs and

benefits that may result from this

proposal. The DOL nonetheless is

presenting below an overview of

potentially affected entities and an

approach to evaluating the possible

impacts of this proposal. In evaluating

costs and benefits, the DOL took

account of the fact that various types of

plans could be affected by more than

one proposed revision. DOL is also

soliciting data relevant to an evaluation

of costs and benefits and comments on

alternative methodologies and

assumptions for evaluating the costs and

benefits.

Defined Contribution Pension Plans:

In 2018, there were 675,007 defined

contribution plans with 105.8 million

total participants and 83.4 million

active participants. Plans with fewer

than 100 total participants (small plans)

account for 87.4 percent of plans.

23

Defined Contribution Group (DCG)

Reporting Arrangement: As this is a new

type of annual reporting method, the

DOL does not have data on how many

DCGs would be created nor the number

of plans that would choose to satisfy

their individual filing obligations by

meeting the requirements for being part

of a DCG, including the filing of a

consolidated Form 5500 Annual Return/

Report by the common plan

administrator. We note that in 2018

there were 499,234 small defined

contribution plans that reported the

plan characteristic code 3D in their

Form 5500–SF to indicate that they are

intended to operate as pre-approved

plans under sections 401, 403(a), and

4975(e)(7) of the Code. The DOL

assumes that a DCG reporting option

may suit their existing plan and

business models and that, therefore,

some fraction of these plans may find it

advantageous to join a DCG for filing

purposes.

Defined Benefit Pension Plans: In

2018, there were 46,869 defined benefit

plans with 34.0 million total

participants and 13.1 million active

participants. There were 45,275 single-

employer defined benefit plans and

1,388 multiemployer defined benefit

plans.

24

Multiple Employer Pension Plans: A

MEP, for Form 5500 reporting purposes,

generally is a retirement plan

maintained by two or more employers

that are not members of the same

controlled group or affiliated service

group under Code section 414(b), (c), or

(m), and which is not a multiemployer

plan.

25

In 2018, there were 4,730 MEPs

filing a Form 5500, of which 207 were

defined benefit pension plans and 4,523

were defined contribution pension

plans. There were 6.9 million

participants reported as covered by

these plans.

26

The proposal, if finalized,

would establish a new Schedule MEP to

report information specific to pension

MEPs. While the new Schedule MEP

would retain ERISA section 103(g)

participating employer information that

MEPs must currently file as a non-

standardized attachment, it also would

add the SECURE Act requirement for

pension MEPS to report aggregate

account balances information for each

participating employer in the MEP.

Schedule MEP would also include

questions intended to focus on SECURE

Act issues and compliance for pooled

employer plans.

Association Retirement Plan. An

association retirement plan is a defined

contribution MEP, sponsored by a bona

fide group or association of employers

that meets the conditions under 29 CFR

2510.3–55(b). The DOL does not have

information on how many reporting

MEPs are association retirement plans

or otherwise to estimate the number of

association retirement plans (a sub-class

of MEPs) that currently exist.

Professional Employer Organizations

(PEOs) Plan: A PEO MEP is a defined

contribution pension plan sponsored by

a bona fide PEO that meets the

conditions under 29 CFR 2510.3–55(c).

According to the National Association

of Professional Employer Organizations,

there are 487 PEOs in the United

States.

27

The DOL does not have

information on how many PEOs

currently meet the conditions under 29

CFR 2510.3–55(c) to sponsor defined

contribution MEPs for their clients, but

assumes a substantial percentage of

PEOs do sponsor MEPs, including

defined contribution MEPs.

Pooled Employer Plans. The SECURE

Act amended section 3(2) of ERISA and

added section 3(43) to ERISA to

authorize a new type of ERISA covered

defined contribution MEP referred to as

a ‘‘pooled employer plan’’ to be

operated by a ‘‘pooled plan provider.’’

In its 2020 final rule on Registration

Requirements for Pooled Plan Providers,

the DOL noted the uncertainty

surrounding the number of pooled

employer plans that could be created

based on the final rule, the number of

employers that would participate in

such plans, and the number of

participants and beneficiaries that

would be covered by them.

28

Approximately 50 pooled plan

providers have filed an initial Form PR

Pooled Plan Provider Registration (Form

PR) and registered with the DOL.

29

The DOL does not have

comprehensive data on how many

employers are participating in pooled

employer plans or the number of

participants covered by the plans until

the pooled employer plans file their first

Forms 5500 in 2022 for their 2021

reporting year. The DOL attempted to

review available public information on

pooled employer plans by looking at

information included in the filed Forms

PR, and by examining news articles and

statements on the pooled plan

provider’s websites. That review

indicated that that there are a variety of

approaches in how pooled employer

plans are offered, and a variation in the

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IRS website at https://www.irs.gov/retirement-

plans/pre-approved-retirement-plans (last updated

Apr 2, 2021).

31

These figures are based on calculations from

2018 Form M–1 filing data.

number of employers that have joined a

pooled employer plan. While pooled

plan providers are required to update

the Form PR to advise the DOL and the

IRS about the establishment and offering

of new pooled employer plans, the Form

PR does not collect information on the

number of employers participating in

their pooled employer plans or the

number of employees covered by each

plan. One pooled plan provider was

reported in another source as having

2,000 employers joined their pooled

employer plan, whereas other providers

reported five to 10 employers had joined

their pooled employer plans. As part of

the request for comments, the DOL is

seeking information on the number of

employers that have already joined a

pooled employer plan and the number

of employees covered by the plan in

total and broken down by employer.

Pre-approved Pension Plans: These

are plans that reported plan

characteristics code 3D when filing the

Form 5500 Annual Return/Report. The

code 3D indicates ‘‘A pre-approved plan

under sections 401, 403(a), and

4975(e)(7) of the Code that is subject to

a favorable opinion letter from the IRS.’’

A pre-approved retirement plan is a

plan offered to employers by financial

institutions and others that are

authorized to sponsor pre-approved

plans. The pre-approved plan provider

then makes the IRS-approved plan

available to adopting employers.

Providers must make reasonable and

diligent efforts to ensure that adopting

employers of the plan have actually

received and are aware of all plan

amendments and that such employers

complete and sign new plans when

necessary.

30

Of the 611,568 defined

contribution pension plans that reported

code 3D, 544,090 are reported as small

plans, as they report having fewer than

100 participants each. Of these small

defined contribution plans, 499,234 file

the Form 5500–SF, cover approximately

10.0 million participants, and hold

approximately $0.6 trillion in assets.

The DOL expects that Form 5500–SF

small pension plan filers are the most

likely candidates to join a DCG or a

pooled employer plan. The DOL lacks

information on the number of plans,

whether or not currently Form 5500–SF

eligible filers, that would join a DCG or

a pooled employer plan. The DOL is

seeking comment on this issue.

Multiple Employer Welfare

Arrangement (MEWA): A MEWA is

defined in ERISA section 3(40)(B)

generally as an employee welfare benefit

plan or any other arrangement, which is

established or maintained for the

purpose of offering or providing welfare

benefits to the employees of two or more

employers, or to their beneficiaries. For

purposes of this definition, two or more

trades or businesses, whether or not

incorporated, are deemed a single

employer if such trades or businesses

are under common control. Section

3(40) excludes from the definition of the

term MEWA any plan or arrangement

established or maintained under or

pursuant to a collective bargaining

agreement, or by a rural electric

cooperative or rural telephone

cooperative association. MEWAs that

offer or provide coverage for medical

benefits are generally required to file the

Form M–1. In the 2018 calendar year,

there were 640 total plan MEWAs that

filed a Form M–1 with 2.0 million total

participants. There were 47 non-plan

MEWAs based on Form M–1 filings.

31

Plans affected by change in

participant-count methodology for

determining large plan versus small

plan status and related filing

requirements. As discussed in the

NPFR, the Agencies are proposing a

change in the methodology for defined

contribution pension plans to determine

whether the plan is a ‘‘large plan’’

(generally covers 100 or more

participants) for purposes of Form 5500

annual reporting requirements,

including the requirement to include an

IQPA report and other schedules

generally applicable to large pension

plans. The plan size measure for this

annual reporting distinction is based on

the total number of participants at the

beginning of the plan year and expressly

includes employees eligible to

participate in a Code section 401(k) plan

(‘‘401(k) plan’’) even if the employees

has not elected to participate and does

not have an account balance. The

proposed change would use a

participant count based on the number

of participants at the beginning of the

year with an account balance. Current

Form 5500 filings collect the number of

participants at the end of the year with

a balance, and does not currently collect

such a figure for the beginning of the

plan year. Accordingly, we used the end

of year number of participants with a

balance to estimate the number of plans

impacted by this change. The actual

number of plans effected could be

higher or lower, depending on a plan’s

dynamics, but for plans that are

growing, using the end of year number

as a proxy for the beginning of year

number could lead to an overestimate of

the number of affected plans. Using the

current definitions of large and small

plans, there are 84,754 large defined

contribution plans and 590,254 small

defined contribution plans. Using the

number of participants at the end of the

year with an account balance as a proxy

for the new proposed methodology,

there are 65,312 large defined

contribution plans and 609,695 small

defined contribution plans. This would

result in an estimated 19,442 defined

contribution plans that, if the

regulations are finalized as proposed,

would be able to file as small plans

instead of large ones and would

experience cost savings, including due

to being able to satisfy the conditions for

being exempt from the IQPA report and

from including the Schedules of Assets

as part of their annual report.

Benefits

Benefits of Changes for Pooled

Employer Plans. The SECURE Act

established a new type of ERISA-

covered defined contribution pension

plan, the pooled employer plan, that is

established and maintained by a pooled

plan provider that meets the conditions

of the statute. By creating the pooled

employer plan structure, the SECURE

Act permitted multiple unrelated

employers to participate without the

need for any common interest among

the employers (other than having

adopted the plan). As discussed above,

pooled employer plans need to provide

ERISA section 103(g) participating

employer information, as well as certain

basic information regarding the pooled

plan provider. Potentially increased

reporting costs for those employers

choosing to offer retirement benefits to

their employees through participating in

a pooled employer plan would be offset

by other cost reductions or business

benefits relative to not having

administer an individual plan as further

discussed below.

By participating in a pooled employer

plan, employers could minimize their

fiduciary responsibilities for ongoing

administration and operation of the

plan. Employers could benefit from

reduced risk and liability because the

pooled plan provider would bear most

of the administrative and fiduciary

responsibility for operating the pooled

employer plan, including hiring and

monitoring the 3(38) investment

manager. Similarly, because the pooled

plan provider handles the

administrative tasks such as participant

communications, plan recordkeeping,

submitting the Form 5500 and

complying with plan audits, this could

increase the operating efficiency for

participating employers. Also, as they

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85 FR at 72949–72950.

33

Szapiro, Aron, ‘‘Pooled Employer Plans:

Paperwork or Panacea.’’ Accessible at https://

www.morningstar.com/lp/paperwork_or_panacea.

34

VanDerhei, Jack. ‘‘How Much More Secure

Does the SECURE Act Make American Workers:

Evidence from EBRI’s Retirement Security

Projection Mode.’’ EBRI Issue Brief. No 501 (2020).

VanDerhei refers to MEPs in which the members do

not need to share a common interest as ‘‘Open

MEPs.’’ (Available at https://www.ebri.org/docs/

default-source/ebri-issue-brief/ebri_ib_501_secure-

20feb20.pdf?sfvrsn=db6f3d2f_4 (Accessed July 21,

2021.)).

are expected to be professional plan

providers, it is anticipated that a pooled

plan provider, relative to a small

employer, would ensure that more

accurate and complete data is reported

to the DOL on the Form 5500. Further,

as discussed in the regulatory impact

analysis to the regulation establishing

the Form PR, pooled employer plans

generally would benefit from scale

advantages, including the ability to

obtain lower fees for investment

options.

32

The marginal costs for pooled

employer plans would diminish and

pooled plan providers would spread

fixed costs over a larger pool of member

employers and employee participants,

creating direct economic efficiencies.

Szapiro’s research finds that the per-

employer cost of a large MEP can be

lower than the cost of a small single

employer plan.

33

Specifically, the study

finds that a MEP with $125 million and

80 participating companies cost 78 basis

points, whereas a single-employer plan

with $1.5 million cost 111 basis points.

Thus, compared to single-employer

plans, MEPS can be a more cost-efficient

option for small employers. The

increased economic efficiency may

result in small businesses being able to

compete more easily with larger

companies in recruiting and retaining

workers due to a competitive employee

benefit package. Finally, pooled

employer plans may enable participants

to achieve better retirement outcomes.

VanDerhei’s research finds that the

adoption of a MEP in which the

members do not need to share a

common interest, other than

participating in the same plan, with a 25

percent opt-out rate among employees,

results in an overall 1.4 percent

reduction in the retirement savings

deficit, compared to when a MEP is not

adopted.

34

The study also finds a 3.1

percent reduction in the retirement

savings deficit for individuals working

for employers with fewer than 100

employees and 3.3 percent reduction in

the retirement savings deficit for

individuals working for employers with

100 to 500 employees.

Benefits of Establishing the Proposed

Schedule MEP. A benefit of the

proposed Schedule MEP would provide

a unified vehicle to report information

related to new SECURE Act provisions,

including information unique to MEPs.

The participating employer information

collected pursuant to section 103(g) of

ERISA would also be data capturable

and available at publicly viewable

website containing images of the Form

5500 and related data sets. That public

data would help protect plan

participants and beneficiaries by

allowing for improved analysis for

oversight and research purposes by the

government, the regulated community,

and other interested stakeholders.

Benefits of DCGs. The proposal would

update Form 5500 annual reporting

requirements to establish requirements

pursuant to section 202 of the SECURE

Act for a consolidated return/report to

provide eligible individual account

plans with an alternative method of

compliance with annual reporting

requirements that would otherwise

mandate a separate annual report for

each plan. The consolidated reporting

option for defined contribution pension

plans also allows for more choice and

flexibility in the reporting of

information to the government. Eligible

plans can choose, based on benefits and

preferences, if they want to continue

with the plan filing as individual plan

or as part of a DCG. Plans whose

individual reporting obligations would

be satisfied by a DCG annual return/

report filing may see a reduction in

reporting costs depending on their

circumstances.

The proposal includes the proposed

Schedule DCG to provide individual

plan-level information for those defined

contribution pension plans whose

annual reporting requirement would be

satisfied by a DCG’s consolidated filing.

The uniformity of the DCG arrangement

structure and the benefits of

consolidated reporting may reduce the

complexity and administrative burden

of plans. Also, by having a common

plan administrator who is expected to

be a professional service provider filing

on behalf of a group, it may increase the

likelihood that more accurate and

complete data is reported to the DOL.

As a result, there may be an increase in

annual reporting compliance and

compliance with applicable ERISA

requirements in general. Additionally,

the Schedule DCG would help the

Agency compare individual plan

participation and aggregate asset and

liability information from year-to-year.

The Schedule DCG would include many

of the questions that are currently

required on the Form 5500–SF, and for

large plans, the Schedule H questions

regarding the report of an IQPA, as well

as an IQPA report. While this

requirement reduces the cost saving of

filing as a DCG, the DOL and the IRS

(collectively ‘‘Departments’’) believe the

information requested is consistent with

the SECURE Act provision permitting

the Departments to collect whatever

plan level information is needed to

perform adequate oversight and vital to

provide to participants, beneficiaries,

and the Departments information

needed to adequately monitor the plans

and keep track of their assets from year

to year.

In light of changes in the financial

environment and increasing concern

about investments in hard-to-value

assets and alternative investments, the

proposed requirement that plans

participating in DCGs must have

investments that meet the currently

applicable ‘‘eligible plan investment’’

criteria for filing a Form 5500 is

important for regulatory, enforcement,

and disclosure purposes. The proposal

would also 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 employer

identification number (EIN), the name of

the trustee or custodian, and the

trustee’s or custodian’s telephone

number. This information will enable

the Agencies to focus more efficiently

on compliance concerns for retirement

plan trusts, including those for pooled

employer plans and DCG reporting

arrangements.

Changes to Method of Determining

Small Plan Status for Certain Filing

Exemptions and Requirements: As

described in the NPFR, the proposal

would change the current method of

counting covered participants for

purposes of determining when a defined

contribution plan may file as a small

plan and whether the plan may be

exempt from the IQPA audit

requirements generally applicable to

large defined contribution pension

plans. Under the proposal, defined

contribution pension plans, including

401(k) plans and 403(b) plans, would

determine whether they have to file as

a large plan and whether they have to

attach an IQPA report based on the

number of participants with account

balances as of the beginning of the plan

year. Currently, the IQPA requirement

includes the total number of eligible

participants at the beginning of the plan

year, even if the participant is not

making contributions, receiving

employer contributions, or maintaining

an account in the plan. Further, 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

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GAO Targeted Revisions Could Improve

Usefulness of Form 5500 Information, at 12.

36

Id.

37

EBSA Needs to Provide Additional Guidance

and Oversight to ERISA Plans Holding Hard-To-

Value Alternative Investments, Department of Labor

Office of Inspector General Report Number: 09–13–

001–12–121 at 4, 18, and 19.

38

These calculations are based on internal

Department calculations based on 2018 Form M–1

filings. See the affected entities section for more

information.

might 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,

beginning January 1, 2024, long-term,

part time workers that have reached the

plan’s minimum age requirement and

have 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,

there could be more employees eligible

to participate that would elect not to do

so. This change in counting

methodology would result in not

counting, for this annual reporting

purpose, those long-term, part time

workers who are eligible to make

elective contributions to a 401(k) plan,

but have not in fact elected to

participate in the plan. The DOL expects

that excluding from the participant

count participants who are eligible to

participate but do not have an account

balance at any time during the plan year

will reduce expenses of establishing and

maintaining a retirement plan, and as a

consequence, encourage more

employers to offer workplace-based

retirement savings plans to their

employees.

Improving Consistency and

Enhancing Usability of Data Filed on

the Schedules of Assets. The financial

information reported on the Form 5500

Annual Return/Report, particularly the

asset/liability statement, contained in

the current Schedule H (Large Plan

Financial Information), Schedule I

(Small Plan Financial Information), as

well as the more recently established

Form 5500–SF, is based on data

elements that have remained largely

unchanged since the Form 5500 Annual

Return/Report was established in 1975.

Many investments in alternative and

hard-to-value assets and held in

collective investment funds do not fit

squarely into any of the existing

reporting categories on data captured

financial schedules filed with the Form

5500 (Schedule H for large plans and

Schedule I for small plans). The GAO

has expressed concerns that many

investments with widely varying risk,

return, and disclosure considerations

are often reported in the catchall ‘‘other

plan asset’’ category.

35

GAO also noted

that the plan asset categories on the

Schedule H are not representative of

current plan investments, and provide

little insight into the investments

themselves, the level of associated risk,

or structures of the investments.

36

The

DOL–OIG have also recommended that

the Agencies revise the Form 5500

Annual Return/Report to improve

reporting of hard-to-value assets and

alternative investments.

37

As part of

their overall evaluation of how best to

structure financial reporting for pooled

employer plans, MEPs, and DCG

reporting arrangements to maximize

usable data while limiting burden

increases, the Agencies decided, as

discussed in detail earlier in this

document and the Notice of Proposed

Forms Revisions published

simultaneously, to propose format, data

element and instruction changes to the

Schedule H, Line 4i Schedule of Assets

Held for Investment and the Schedule of

Assets Acquired and Disposed of Within

the Plan Year. Although driven by an

interest in ensuring transparency and

financial accountability for pooled

employer plans, MEPs, and DCG

reporting arrangements, the rationales

for the changes applied more generally

to large pension and retirement savings

plans. These changes apply to large

plans required to file the Schedules of

Assets and would not increase the

annual reporting burden for small plans.

The proposed changes to the Schedule

H Line 4i Schedules of Assets, in

addition to better meeting the needs of

the Agencies, other government users,

and other end users of the data, should

serve to address the shortcomings

identified in these reports. The basic

objective of general financial reporting

is to provide information about the

reporting entity for the Agencies’

enforcement, research, and policy

formulation programs, for other Federal

agencies, Congress, and the private

sector in assessing employee benefit,

tax, and economic trends and policies;

and for plan participants and

beneficiaries and the general public in

monitoring employee benefit plans.

Making consistent the financial

reporting instruments would bring

greater transparency to plan

transactions, which would enhance the

efficiency of the Agencies’ enforcement

efforts. Specifically, the Agencies would

be better able to focus their enforcement

efforts, which will reduce the number of

investigations involving plans that are

not engaging in problematic activities.

Additionally, ERISA Section 513(a)

authorizes and directs the Secretary of

Labor and EBSA to conduct a research

program on employee benefits. The

Form 5500 Annual Return/Report is one

of the leading sources of data used in

this research program. Making uniform

and receiving in a data searchable way

the financial information reported on

the Form 5500 Annual Return/Report

would improve the quality of the

research conducted by internal and

external researchers. This improved

research, in turn, would improve the

quality of policy decisions made by

DOL and other governmental

policymakers that rely on the Form 5500

Annual Return/Report data.

Benefits of Maintaining Participating

Employer Information for MEWAs and

Expanding It to Non-Plan MEWAs that

Provide Medical Benefits. The proposal,

as described in the NPFR, would add

new questions to the Form M–1 and

instructions to require MEWAs (plan

and non-plan) that offer or provide

coverage for medical benefits to provide

multiple employer participating

employer information on the Form

M–1 and not as an attachment to the

Form 5500 Annual Return/Report. Plan

MEWAs that provide other benefits and

thus are not required to file a Form

M–1 (i.e., life and disability benefits)

would continue to report the

participating employer information as

an attachment to the Form 5500 Annual

Return/Report.

The proposal would also change

which MEWAs are required to report

the participating employer information.

The current Form 5500 requirement for

MEPs to report participating employer

information applies to plan MEWAs

only. Non-plan MEWAs providing

health benefits would now have to

provide the information. Based on 2018

Form M–1 filings, there were 640 plan

MEWAs and 47 were non-plan

MEWAs.

38

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

Agencies to receive participating

employer information from both plan

and non-plan MEWAs, regardless of

how they are funded or structured. This

would help the Agencies better monitor

activities of MEWAs and protect plan

beneficiaries.

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IRS is proposing to make a parallel update to

the Form 5500–EZ, which is solely in the

jurisdiction of the IRS.

40

The DOL believes that the annual cost burden

on filers would be higher still in the absence of the

regulations enabling use of the Form 5500 Annual

Return/Report in lieu of the statutory requirements.

Without the Form 5500 Annual Return/Report,

filers would not have the benefits of any regulatory

exceptions, simplified reporting, or alternative

methods of compliance, and standardized and

electronic filing methods.

Internal Revenue Code-Based

Questions for the 2022 Form 5500s. In

the NPFR, several questions are being

proposed to be added to the 2022 Form

5500s to help identify plans that are

more likely to experience compliance

issues, and help the IRS more effectively

conduct investigations. Section III.F of

the preamble to the NPFR provides a

description of these proposed Code-

based questions. The proposal, as set

forth in the NPFR, 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).

Adding this question will allow EP to

identify these plans for examination.

This question is also helpful when

performing pre-audit 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, as described in the

NPFR, would add a question to Form

5500 and Form 5500–SF, for 401(k)

plans asking whether the plan sponsor

used the design-based safe harbor rules

or the ‘‘prior year’’ ADP, or ‘‘current

year’’ ADP test, or if it is not applicable.

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, would

allow EP to identify 401(k) plans that

use ADP testing for examination over

plans that have designed-based safe

harbors. This question would also help

the IRS perform pre-audit analysis and

for design-based safe harbor plans allow

us to verify whether allocations of

required safe harbor contributions

comply with the terms of the plan; and

whether proper notice requirement is

satisfied on an annual basis.

Finally, the proposal, as indicated in

the NPFR, would add a question to

Form 5500 and the Form 5500–SF

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.

39

This question would 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

would also assist IRS in determining

whether to select a plan for examination

as a late amender for changes in the law.

Defined Benefit Plan/Title IV

Questions for the 2022 Form 5500s: The

proposed changes to the Form 5500

Schedules MB, SB, and R would help

remedy data and information

inadequacies, increasing plans’

transparency, enable Agencies to project

more precisely defined benefit pension

plans’ and insurance programs’

liabilities, and help the PBGC more

effectively conduct investigations and

better protect plan participants and

beneficiaries.

Schedule MB collects actuarial

information on multiemployer defined

benefit plans and certain money

purchase plans. By revising line 6 and

clarifying the expense load percentage

calculation, the Agencies would be able

to easily identify the expense load and

more accurately project plan liabilities

to model the impact of additional

employers withdrawing from the plan in

the future. The proposed changes to the

schedule would provide greater

transparency in the actuarial status and

the actuarial assumptions of the plans.

Based on reviewing previously filed

Schedules MB responses to line 4f, it

appears to the Agencies that there is

some confusion as to how to fill out line

4f of Schedule MB correctly, as some of

the responses do not make sense.

Clarification of the instructions and line

language is intended to remove

potential confusion and provide more

consistent and correct responses.

Schedule SB collects actuarial

information on single-employer defined

benefit plans. The proposed changes

would better align filing requirements

for single-employer defined benefit

plans with the more detailed

requirements for PBGC-insured

multiemployer plans. As with the

proposed changes to the Schedule MB,

these proposed changes would allow for

greater transparency in the actuarial

status and the actuarial assumptions of

the plans.

Schedule R collects information on

retirement plans. Previously,

multiemployer defined-benefit pension

plans were required to report

identifying information about any

employer whose contributions to the

plan exceeded five percent of total

annual contribution. The regulation

proposes, instead, to require plans to

report identifying information on any

employer who (1) contributed more than

five percent of the plan’s total

contributions or (2) was one of the top

ten highest contributors. This would

provide greater transparency on

contributors and ensure that reported

data represents a reasonable sampling of

contributors.

The proposed regulation also

proposes changes in format for certain

attachments. EFAST2 filers currently

file some Form 5500 attachments as PDF

and plain text files. Due to the nature of

the attachments, they often include

many numbers that are difficult to

extract from these file types. There is

consideration being given to steps that

could be taken to allow more integration

of common tabular formats

(spreadsheet) such as Comma Separate

Value(s) (CSV). As this is not being

considered as a requirement at this

point, plans would not incur an

additional cost if such functionality

were made available. Rather, the

Agencies expect this option may

simplify the process for preparing and

filing attachments.

1.3. Cost Estimates and Savings

The DOL anticipates that the costs for

plans to satisfy their annual reporting

obligations would on average decrease

under these proposed regulations

relative to the current regime.

40

As

shown in Table 1 below, the aggregate

annual cost of such reporting under the

current regulations and forms is

estimated to be $514.8 million annually,

shared across the 822,100 filers subject

to the filing requirement.

The DOL estimates that the

regulations and forms revisions in this

proposed rule would impose an annual

burden of $514.1 million on 804,100

filers, for a total decrease of $64.6

million annually, $63.9 million

annually in audit cost savings and $0.7

million annually in other reporting

costs. This proposal makes important

changes to the requirements currently in

effect while also allowing for the

number of small plans and large plans

to change for annual reporting purposes.

The DOL estimates that a total of 17,601

small plans and 563 large plans would

opt to join either a DCG or a pooled

employer plan, and therefore have their

filing requirement fulfilled by these

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For the calculation of the total number of

participating employers in pooled employer plans,

it is first assumed that 80 percent of all the

employers who would participate in a pooled

employer plan are currently providing benefits

through small plans, and that the remaining 20

percent through large plans. This distribution

would apply to the registrant that has already

exceptionally listed 2000 employers (which would

then be divided in 1600 small participating plans

and 400 large participating plans) and to the other

74 pooled plan providers assumed to be created. It

is also assumed that each one of these other 74

pooled plan providers would be servicing in total

11 employers. Therefore, the total number of small

participating plans in a pooled employer plan is

calculated as: 1,600 + (74 * 11 * 0.8) = 2,251

(rounded). Similarly, the total number of large

participating plans is calculated as 400 + (74 * 11

* 0.2) = 563 (rounded).

entities. The DOL also estimates that

19,442 large plans would be re-defined

and file as small plans as a result of the

change in the current threshold for

determining when a defined contribution plan may file as a small

plan.

T

ABLE

1—E

STIMATED

B

URDEN

C

HANGE BY

T

YPE OF

F

ILER

A

LL

P

ROPOSED

C

HANGES

Type of plan

Number of

filers under

current

(thousands)

Number of

filers under

proposed

(thousands)

Aggregate

cost under

current

(millions)

Aggregate

cost under

proposed

(millions)

Aggregate

cost change

(millions)

Large Plans .......................................................................... 146.8 126.9 $268.8 $260.3 ¥$8.4

Small Plans .......................................................................... 666.1 667.9 234.7 235.2 0.5

DFEs .................................................................................... 9.3 9.4 11.4 18.6 7.2

All Plans ........................................................................ 822.1 804.1 514.8 514.1 ¥0.7

Audit Cost ¥63.9

Overall Total ¥64.6

Note: Some displayed numbers do not sum up to the totals due to rounding.

Large plans—100 participants or more.

Small plans—generally fewer than 100 participants.

To estimate the net change in cost

burden, as a result of the interaction of

the proposed changes, the DOL has also

analyzed the cost impact of the

individual revisions on classes of filers.

In doing so, the DOL took account of the

fact that various types of plans would be

affected by more than one revision and

that the sequence of multiple revisions

would create an interaction in the

cumulative burden on those plans. The

total changes in Table 1 show the

accumulated changes. The other tables

below show only the impact of a single

change at a time from the status quo;

therefore, the tables cannot be added to

arrive at the estimates in Table 1.

Schedule MEP and Pooled Employer

Plans. The proposed new Schedule MEP

would be filed by all MEPs, including

pooled employer plans, and includes

participating employer information

already filed as an attachment, as well

as limited specific reporting

requirements for pooled employer

plans. The information on participating

employers would then be data-readable,

whereas currently it is only included as

a nonstandard attachment. As discussed

in the affected entities section, estimates

are available for MEPs that have filed a

Form 5500 previously, but not for the

newly created pooled employer plans

that have yet to file a Form 5500. The

impacts of the DOL recent rulemaking

on association retirement plans and PEO

MEPs also carries some uncertainty

regarding the number of MEPs that may

be affected. Approximately 50 entities

have filed the Form PR to register as

pooled plan providers. Therefore, for

purposes of this analysis, the DOL

assumes there would be a total of 75

pooled employer plans. As it is the case

with MEPs, joining a pooled employer

plan translates into less plan

maintenance expenditures given that

MEPs can take advantage of economies

of scale. Additionally, in the DOL’s

view, the information requested on the

Schedule MEP should already be

available to plans, so the burden is

primarily entering the information onto

the form. The burden to file the

Schedule MEP is estimated to average

10 minutes for MEPs and 14 minutes for

pooled employer plans, with variation

depending on the number of

participating employers.

Although the DOL does not know for

certain how many plans would decide

to offer benefits through a pooled

employer plan, it is assumed that the

current average number of participating

employers in a MEP is indicative of the

average number of employers that

would eventually be in any particular

pooled employer plan that may be

established in the future. The DOL

estimates that MEPs, on average, have

nine employers participating in a MEP

with fewer than 100 participants and

two employers with 100 or more

participants. The DOL uses these

measures as estimates for most of the

upcoming pooled employer plans,

therefore assuming that, for most pooled

employer plans, on average there would

be nine small participating plans and

two large participating plans per pooled

employer plan. Combined with one

pooled plan provider registrant that has

already listed 2000 participating

employers, it is estimated that a total of

2,251 small participating plans and 563

large participating plans would provide

benefits through pooled employer

plans.

41

The DOL assumes this would

result in a direct decrease of 2,251

defined contribution Form 5500–SF

filers and a decrease of 563 Form

defined contribution 5500 filers. As

Table 2 shows this would result in a

reporting cost reduction of $1.5 million

(not including the audit cost reduction

in Table 1) and a total reduction of filers

from 822,100 to 819,400 filers. Such a

reduction in filers would be partially

offset by an increase in pooled employer

plan filings. We are not, however, able

to explicitly measure the net impact on

filings because of the uncertainty

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The DOL acknowledges that there could be

other employers whose plans are outside the

category of small defined contribution type, which

currently file the Form 5500–SF and report plan

characteristic 3D, that might also find an advantage

in joining a DCG and therefore start providing

benefits this way.

43

https://www.irs.gov/retirement-plans/pre-

approved-retirement-plans.

regarding the number of pooled

employer plans and the resulting

increase in pooled employer plan

filings. The DOL requests comments on

these estimates.

T

ABLE

2—E

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URDEN

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T

YPE OF

F

ILER

I

NTRODUCTION OF

P

OOLED

E

MPLOYER

P

LANS AND

S

CHEDULE

MEP F

ILING

Type of plan

Number of

filers under

current rules

(thousands)

Number of

filers under

proposed rules

(thousands)

Aggregate

reporting

cost under

current rules

(millions)

Aggregate

reporting

cost under

proposed rules

(millions)

Aggregate

cost change

(millions)

Large Plans .......................................................................... 146.8 146.3 $268.8 $267.9 ¥$0.9

Small Plans .......................................................................... 666.1 663.8 234.7 234.0 ¥0.7

DFEs .................................................................................... 9.3 9.3 11.4 11.4 0.0

Overall Total ................................................................. 822.1 819.4 514.8 513.3 ¥1.5

Note: Some displayed numbers do not sum up to the totals due to rounding.

Large plans—100 participants or more.

Small plans—generally fewer than 100 participants.

DCG filings. As discussed above, a

DCG filing for a group of plans has the

potential to reduce reporting burden as

only one Form 5500 is filed and signed

by a common plan administrator so

signatures from separate administrators

of the participating plans are not

needed. Offsetting these cost savings

would be the burden from the

consolidated Form 5500 filed by the

DCG, including the Schedule DCG to

report individual plan information for

each participating plans. There are

499,234 small defined contribution

plans that file the Form 5500–SF and

report the plan characteristic code 3D;

the DOL assumes this type of plan may

find it advantageous to adopt this new

structure of providing benefits and

therefore a fraction of them will join a

DCG. The DOL seeks comments on these

assumptions.

42

The change in burden from allowing

a DCG to file on behalf of plans is

estimated in the following manner.

Apart from the 499,234 small defined

contribution mentioned above, there are

1,813 pre-approved plans.

43

While the

DOL does not know if all 1,813 pre-

approved plans actually would file on

behalf of these 499,234 plans, if they did

there would be an average of 275 plans

per pre-approved filer. These pre-

approved filers are the likeliest entities

to file as a DCG. Although DOL lacks

sufficient information to confidently

estimate how many DCGs will form, the

50 entities that have filed the Form PR

to register as a pooled plan provider, so

far, may be suggestive of the number of

entities currently seeking to take

advantage of new structures to reduce

plan administrative costs. Potential

DCGs may be better positioned than

pooled plan providers to commence

operations as they already have client

plans that could benefit from the

savings and do not have to switch plans.

Therefore, the DOL assumes that twice

the number of DCGs (100) would form

in the first year as the number of pooled

plan providers (50). With the

availability of DCGs as an option, some

service providers may discontinue their

provision of individual Form 5500 filing

services, and only offer to file as DCGs.

Some plans that contract with such

service providers may choose to be

moved into DCG filings, while others

may seek out new service providers

because they don’t wish to comply with

the additional filing obligations placed

on DCG filers. For purposes of this

analysis, we assume that approximately

half of the plans currently associated

with a pre-approved plan provider

would be offered the opportunity and

would agree to comply with the DCG

requirements to stay with the same

provider. The DOL then uses these

results to assume 100 DCGs with a total

of 15,350 small plans whose annual

return/report filing obligation would be

satisfied by the filing of a DCG Form

5500.

As described above, the consolidated

return/report that would need to be filed

by the DCG to satisfy the annual

reporting requirements of participating

plans would have to include a Schedule

DCG for each participating plan. The

cost calculation must therefore take into

account cost of this schedule per plan

participating in a DCG. The DOL

believes that once individual plans join

a DCG, the average cost of filing a

Schedule DCG, which would be done

for each one of the estimated 15,350

participating plans, would be lower

than the cost of filing a Form 5500–SF

separately, which cost was incurred by

a small plan before joining a DCG.

Although the DOL does not know how

much lower this new cost would be, it

estimates that completing a schedule

DCG as part of the DCG’s Form 5500

annual return/report would take about

40 percent less time than completing a

Form 5500–SF for each individual plan.

As Table 3 shows, assuming the

number of DCGs and plans per DCG as

described above, along with the

estimated cost of filing schedule DCG,

the DOL expects an overall cost

reduction of $1.6 million. This cost

reduction assumes, as baseline, the

current definition of large and small

plans, and would be the result of a

decrease in the number of Form 5500–

SF filers, from 666,100 to 650,700. Such

a reduction in filers would be partially

offset by an increase in DFE filings,

which reflects the introduction of DCGs

as filing entities.

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ABLE

3—E

STIMATED

B

URDEN

C

HANGE BY

T

YPE OF

F

ILER

I

NTRODUCTION OF

DCG

S AND

S

CHEDULE

DCG F

ILING

Type of plan

Number of

filers under

current rules

(thousands)

Number of

filers under

proposed rules

(thousands)

Aggregate

reporting

cost under

current rules

(millions)

Aggregate

reporting

cost under

proposed rules

(millions)

Aggregate

cost change

(millions)

Large Plans .......................................................................... 146.8 146.8 $268.8 $268.8 $0.0

Small Plans .......................................................................... 666.1 650.7 234.7 230.1 ¥4.6

DFEs .................................................................................... 9.3 9.4 11.4 14.3 2.9

Overall Total ................................................................. 822.1 806.9 514.8 513.1 ¥1.6

Note: Some displayed numbers do not sum up to the totals due to rounding.

Large plans—100 participants or more.

DSmall plans—generally fewer than 100 participants.

As noted above, there is substantial

uncertainty regarding these estimates.

The DOL specifically seeks comments

on estimates of the number of DCGs, the

number of plans joining those DCGs,

and the cost of filing a schedule DCG

compared to filing a Form 5500–SF, and

the overall cost burden savings due to

plans joining a DCG.

Revised financial reporting on the

Schedule H: Revising the Schedule H

Line 4i Schedules of Assets to make it

data-capturable to increase the

accessibility to this information,

including information regarding hard-

to-value assets, would increase costs.

Without altering the current definition

of large and small plans, the DOL

estimates that the effect of this change

would be to increase the total burden by

370,253 hours, which reflects the

increase in burden that large plans and

DFEs, both as typical filers of Schedule

H, would face. As Table 4 shows, in

total this change would translate into an

increase of filing costs of $41 million

(which represents an estimated cost of

approximately $260 per large plan/DFE

potentially required to file the

Schedules of Assets). The Department

seeks comments on the increase in

burden for entities filing the Schedule

H, and if that burden will decrease over

time.

T

ABLE

4—E

STIMATED

B

URDEN

C

HANGE BY

T

YPE OF

F

ILER

R

EVISED

F

INANCIAL

R

EPORTING ON THE

S

CHEDULE

H

Type of plan

Number of

filers under

current rules

(thousands)

Number of

filers under

proposed rules

(thousands)

Aggregate

reporting

cost under

current rules

(millions)

Aggregate

reporting

cost under

proposed rules

(millions)

Aggregate

cost change

(millions)

Large Plans .......................................................................... 146.8 146.8 $268.8 $305.4 $36.7

Small Plans .......................................................................... 666.1 666.1 234.7 234.7 0.0

DFEs .................................................................................... 9.3 9.3 11.4 15.6 4.3

Overall Total ................................................................. 822.1 822.1 514.8 555.7 41.0

Note: Some displayed numbers do not sum up to the totals due to rounding.

Large plans—100 participants or more.

Small plans—generally fewer than 100 participants.

Changes to Methodology for

Determining Small Plan Status for

Purposes of Annual Report Filing

Requirements: The proposal would

adopt the change described in the NPFR

to the current method of counting

participants for purposes of determining

when a defined contribution plan may

file as a small plan and whether the

plan may be exempt from the IQPA

audit requirement. Specifically, the

proposal would allow plans to count

just the number of participants/

beneficiaries with account balances as

of the beginning of the plan year, as

compared to the current rule that counts

all the employees eligible to participant

in the plan by adding 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 plan year.

This change would reduce costs for

plans. The additional question imposes

little burden as the end-of year number

is already tracked and reported, but to

plans who now qualify as small instead

of large, savings could be significant.

EBSA estimates that the typical

reporting burden of all required

schedules for a small pension plan is

$348. In contrast, the typical reporting

burden of all required schedules for a

large pension plan is currently

estimated by EBSA to be $1,903. While

there would be a cost reduction, these

plans and their participants would no

longer have the protections provided by

the audit, which could result in an

increased risk of errors and fraud, but

there are conditions for small plans to

be eligible for the audit waiver that are

designed to address those potential

risks. In the case of small pension plans,

to be eligible for the audit waiver small

pension plans must meet conditions

related to investment assets, financial

institutions holding plan assets,

disclosures to participants and

beneficiaries, and enhanced fidelity

bonding for persons who handle certain

assets. In the case of welfare plans, both

large and small plans, the plan must be

fully insured or unfunded to be eligible

for the audit waiver. Consistent with the

Department’s goal of encouraging

pension plan establishment and

maintenance, particularly in the small

business community, the Department

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To estimate the number of large plans currently

providing the IQPA report and audited financial

statements the DOL identified those large plans that

would be most likely to be re-defined as small plans

and to have filed the Schedule H in 2018, as

estimated on the 2018 Form 5500 Pension Research

Files. Note that the 80 to 120 participant transition

provision at 29 CFR 2520.103–1(d) allows a plan

that covers fewer than 100 participants to continue

taking advantage of the simplified option or

exemption, as applicable, until they reach 121

participants, therefore not all plans with 100 or

more participants will file a plan in a given year.

45

See http://Mathematica.org/publications/

estimates-of-the-burden-for-filing-form-5500-the-

change-in-burden-from-the-1997-to-the-1999-forms.

46

A report by Mathematica suggests audit costs

of between $3,000 and $30,000. Adjusted for

inflation this would be about $5,000 to $50,000 in

2021 dollars. https://mathematica.org/publications/

estimates-of-the-burden-for-filing-form-5500-the-

change-in-burden-from-the-1997-to-the-1999-forms.

See also www.paychex.com/retirement-services/

pooled-employer-plans (accessed July 21, 2021)

which suggest $10,000 to $20,000. Additionally

conversations with stake holders suggest a range

similar to the $10,000 to $20,000. As the affected

plans are expected to be small, the low estimates

are averaged ($5,000 and $10,000) to arrive at

$7,500.

concluded that engaging an accountant

should not be the only means by which

the security of small plan assets can be

adequately protected. Rather, in

developing the proposed regulation,

consistent with the existing regulatory

conditions for the small plan audit

waiver, the Department attempted to

balance the interest in providing secure

retirement savings for participants and

beneficiaries with the interest in

minimizing costs and burdens on small

pension plans and the sponsors of those

plans.

The DOL estimates that there could be

a reduction of 20,005 large plans filing

under the proposed regulations, 19,442

defined contribution plans due to the

changing definition of who can file as a

small plan, and 563 large participating

plans that could provide benefits

through pooled employer plans. An

estimated 11,362 of these plans

currently provide the IQPA report and

audited financial statements and would

therefore save in audit costs.

44

The

Department estimates that there could

be an audit cost reduction of $7,500 for

each one of these 11,362 plans. Plans

may still conduct an audit, even if there

is no requirement. It is estimated that 25

percent of plans could still conduct an

audit.

45

Data on the cost of an audit for

these plans is not known and will vary

based on plan size and complexity. An

estimate of $7,500 is used to estimate

the cost savings.

46

The Department

seeks comment on the size of the costs

savings. Cost savings of $63.91 million

annually is estimated for the 8,522 plans

(11,362 * 0.75) that will no longer be

required to conduct an audit. These

cost-savings are reported in Table 1

above.

As discussed above there are an

estimated 19,442 defined contribution

plans that would now be able to file as

a small plan. Other reporting cost

savings for these plans are based on

their filing the Form 5500–SF instead of

the Form 5500 and the correspondent

schedules. As shown in Table 5, the

DOL estimates that this redefinition of

small and large alone would translate

into a decrease of filing costs of $29.4

million, with a reduction from 146,800

to 127,400 in large plan filers. The DOL

requests comments on this estimate.

T

ABLE

—E

STIMATED

B

URDEN

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T

YPE OF

F

ILER

C

HANGES TO

F

ILING

E

XEMPTIONS AND

R

EQUIREMENTS FOR

S

MALL

P

LANS

Type of plan

Number of

filers under

current rules

(thousands)

Number of

filers under

proposed rules

(thousands)

Aggregate

reporting

cost under

current rules

(millions)

Aggregate

reporting

cost under

proposed rules

(millions)

Aggregate

cost change

(millions)

Large Plans .......................................................................... 146.8 127.4 $268.8 $233.6 ¥$35.2

Small Plans .......................................................................... 666.1 685.5 234.7 240.4 5.8

DFEs .................................................................................... 9.3 9.3 11.4 11.4 0.0

Overall Total ................................................................. 822.1 822.1 514.8 485.4 ¥29.4

Note: Some displayed numbers do not sum up to the totals due to rounding.

Large plans—100 participants or more.

Small plans—generally fewer than 100 participants.

Changes for MEWAs that file the Form

M–1. As set forth in the NPFR, the

proposal would update the Form M–1,

transferring the multiple employer

participating employer information

questions from the Form 5500 to the

Form M–1 for MEWAs (plan and non-

plan) that offer or provide coverage for

medical benefits and continued

reporting of participating employer

information on the Form 5500 Annual

as an attachment for plan MEWAs that

provide other benefits. The current

Form 5500 requirement for MEPs to

report participating employer

information applies to plan MEWAs

offering all types of benefits—not just

those that provide group health plans.

The DOL estimates that the change in

burden would be de minimis for these

plans.

However, non-plan MEWAs providing

health benefits would now have the

added burden of providing the

participating employer information. The

DOL assumes that non-plan MEWAs

already have access to this information,

and reporting it would not add a

substantive burden to these entities’

reporting costs.

Internal Revenue Code and ERISA

Title IV Proposed Changes. As described

the NPFR, the proposal includes

changes related to Internal Revenue

Code requirements and reporting

requirements for defined benefit

pensions subject to filing Schedules MB,

SB, and R. The Agencies’ believe the

additional questions reflect information

plans should know and expect that

reporting this information would result

in a de minimis marginal burden.

Assumptions, Methodology, and

Uncertainty: The cost and burden

associated with the annual reporting

requirement for any given plan depend

upon the specific information that must

be provided, given the plan’s

characteristics, practices, operations,

and other factors. For example, a small,

single-employer defined contribution

pension plan eligible to file the Form

5500–SF should incur far lower costs

than a large, multiemployer defined

benefit pension plan that holds multiple

insurance contracts, engages in

reportable transactions, and has many

service providers that each received

over $5,000 in compensation. The DOL

separately considered the cost to

different types of plans in arriving at its

aggregate cost estimates. The DOL’s

basis for these estimates follows.

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The MPR report can be accessed at https://

mathematica.org/publications/estimates-of-the-

burden-for-filing-form-5500-the-change-in-burden-

from-the-1997-to-the-1999-forms. See also

Technical Appendix: Documentation of Form 5500

Revision Burden Model at www.dol.gov/agencies/

ebsa/laws-and-regulations/rules-and-regulations/

technical-appendices.

48

See 72 FR 64731 (Nov. 16, 2007) and 81 FR

47496 (July 16, 2016).

49

For purposes of this analysis, multiple

employer plans were treated as single employer

plans.

Assumptions Underlying this

Analysis: The DOL’s analysis assumes

that all benefits and costs would be

realized in the first year of the reporting

cycle to which the changes apply and

within each year thereafter. This

assumption is premised on the

requirement that each plan will be

required to file the Form 5500 Annual

Return/Report. The DOL has used a

‘‘status quo’’ baseline for this analysis,

assuming that the world in the future,

absent the proposed regulations, will

resemble the present. The DOL does not

anticipate that there will be material

one-time transition cost for learning or

updating systems during the first year in

which the reporting changes apply. The

proposal would largely apply

requirements currently in effect for large

MEPs to pooled employer plans and

DCGs. The financial services providers

and recordkeepers that be sponsoring

such plans and DCGs generally are

already providing Form 5500 filings

services for the employee benefit plans

they service so we do not anticipate

material start-up costs for them to file

Form 5500s on behalf of pooled

employer plans or DCGs. We also do not

anticipate that individual plans that

participate in a DCG reporting

arrangement would expend more time

to supply information to DCG reporting

arrangements during the first year than

what they currently incur to supply

annual reporting data to service

provides that prepare their annual

reports (and may in fact incur less time

even during the first year). Similarly,

the creation of the Schedule MEP

mostly reorganizes the way annual

reporting data is provided by affected

plans, rather than adding significant

additional information collection.

Similarly, the changes to the content of

the Schedules of Assets are calling for

reporting of a very limited number of

data elements that plans should already

have as part of the ordinary business

records. The DOL also expects that the

formatting changes being proposed to

make the Schedules of Assets more

usable will match formatting that filers

already use to file various other

schedules, and, accordingly, they would

not involve material costs for learning or

system adjustments. Moreover, the DOL

is proposing 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. The DOL solicits comments on

whether filers would want a similar

option for the Schedules of Assets and

whether they believe such an option

would reduce reporting burdens,

including any potential transition cost.

Further, with respect to the limited

number of additional questions for

defined benefit pension plans and Code-

sponsored their own single employer

plan. An estimated 11,362 of those

affected large plans currently provide

the IQPA report and audited financial

statements that would save in audit

costs under the proposal.

59

There is

variation in filing requirements based

on the characteristics of a plan and

types of assets held. However, these

plans would no longer need to attach

the IQPA report (audit) and other

schedules required of large plans with

its annual return/report. As described

earlier in this document,

60

the

Department estimates that there could

be an audit cost reduction of $7,500 for

each one of these 11,362 plans. Plans

may still conduct an audit, even if there

is no requirement. It is estimated that 25

percent of plans could still conduct an

audit. Data on the cost of an audit for

these plans is not known and will vary

based on plan size and complexity. An

estimate of $7,500 is used to estimate

the cost savings per year. These plans

also would no longer be required to file

the Schedule H, but would need to file

the Schedule I. The difference in burden

between filing Schedule H and

Schedule I is estimated to be $770 per

year.

61

Table 6 above shows that number of

plans by the amount of assets in the

plans. This shows an estimate of 5,369

plans (those with less than $1 million in

assets) that would see a costs savings of

about one percent of plan assets.

62

The establishment of DCGs, the use of

Schedules DCG ($178 per plan),

Schedule MEP ($20 for most MEPs and

$26 per pooled employer plan), and the

other changes could impact a

substantial number of small plans, as

discussed above, but the impacts per

plan are small in magnitude and do not

meet the qualifications for a significant

impact for this analysis.

3.4. Duplicate, Overlapping, or Relevant

Federal Rules

The DOL is unaware of any relevant

Federal rules for small plans that

duplicate, overlap, or conflict with these

regulations.

3.5. Description of Steps Taken To

Minimize the Impact on Small Entities

These proposed regulations and

related changes to the Form 5500

Annual Return/Report generally

implement or otherwise relate to

SECURE Act changes to ERISA and the

Code, and do not include significant

modifications to existing small plan

simplified reporting options other than

expanding the number of plans that will

be eligible for simplified reporting

options by reason of the proposed

change in the method of counting

participants for determining small plans

versus large plan status. Small pension

plans that are invested in ‘‘eligible’’

plan assets and otherwise meet certain

requirements are able to use a simplified

reporting option of filing Form 5500–SF,

which was established by regulation in

part to comply with provisions of the

Pension Protection Act requiring a

simplified form of reporting for plans

with fewer than 25 participants. In light

of the fact that the majority of small

plans required to file an ERISA annual

report cover fewer than 25 participants,

the simplified reporting option also

constitutes the Department’s efforts to

further reduce the information

collection burden for small business

concerns with fewer than 25 employees,

pursuant to the Small Business

Paperwork Relief Act of 2002, Public

Law 107–198, see 44 U.S.C. 3506 (c)(4).

The Department, in developing the

proposed regulatory changes for Form

5500 filings by DCGs, carried forward an

audit waiver for small plans

participating in a DCG consolidated

Form 5500 filing. We also, in

developing the Schedule MEP filing

requirements for pooled employer plans

and other MEPs, did not expand small

plan reporting requirements. We

generally limited the information

collection to consolidating information

onto the Schedule MEP information that

is already reported elsewhere by MEPs

on the current Form 5500, as discussed

elsewhere in this preamble and in the

NPFR. Overall, the DOL believes that

the proposed changes to the reporting

requirements reduce the burden on

small plans, while allowing the DOL to

collect sufficient information for it to

fulfill its statutory responsibilities.

4. Unfunded Mandates Reform Act

Title II of the Unfunded Mandates

Reform Act of 1995 requires each

Federal agency to prepare a written

statement assessing the effects of any

Federal mandate in a proposed or final

agency rule that may result in an

expenditure of $100 million or more

(adjusted annually for inflation with the

base year 1995) in any one year by State,

local, and tribal governments, in the

aggregate, or by the private sector.

63

For

purposes of the Unfunded Mandates

Reform Act, as well as Executive Order

12875,

64

this proposal does not include

any Federal mandate that the DOL

expects would result in such

expenditures by State, local, or tribal

governments, or the private sector.

5. Federalism Statement

Executive Order 13132 outlines

fundamental principles of federalism,

and requires the adherence to specific

criteria by Federal agencies in the

process of their formulation and

implementation of policies that have

‘‘substantial direct effects’’ on the

States, the relationship between the

National Government and States, or on

the distribution of power and

responsibilities among the various

levels of government.

65

Federal agencies

promulgating regulations that have

federalism implications must consult

with State and local officials and

describe the extent of their consultation

and the nature of the concerns of State

and local officials in the preamble to the

rule.

In the DOL’s view, these proposed

regulations would not have federalism

implications because they would not

have direct effects on the States, on the

relationship between the National

Government and the States, or on the

distribution of power and

responsibilities among various levels of

government. These proposed rules do

not have federalism implications

because they would have no substantial

direct effect on the States, on the

relationship between the National

Government and the States, or on the

distribution of power and

responsibilities among the various

levels of government. Section 514 of

ERISA provides, with certain exceptions

specifically enumerated, that the

provisions of Titles I and IV of ERISA

supersede any and all laws of the States

as they relate to any employee benefit

plan covered under ERISA. The

requirements proposed to be

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implemented in these rules do not alter

the fundamental provisions of the

statute with respect to employee benefit

plans, and as such would have no

implications for the States or the

relationship or distribution of power

between the National Government and

the States. The DOL welcomes input

from affected States regarding this

assessment.

List of Subjects in 29 CFR Part 2520

Accounting, Employee benefit plans,

Freedom of information, Pensions,

Public assistance programs, Reporting

and recordkeeping requirements.

For the reasons discussed in the

preamble, 29 CFR part 2520 is proposed

to be amended as follows:

PART 2520—RULES AND

REGULATIONS FOR REPORTING AND

DISCLOSURE

■1. The authority citation for part 2520

is revised to read as follows:

Authority: 29 U.S.C. 1002(44), 1021–1025,

1027, 1029–31, 1059, 1134, and 1135; and

Secretary of Labor’s Order 1–2011, 77 FR

1088. Sec. 2520.101–2 also issued under 29

U.S.C. 1132, 1181–1183, 1181 note, 1185,

1185a–b, 1191, and 1191a–c. Sec. 2520.101–

5 also issued under 29 U.S.C. 1021 note; sec.

501, Pub. L. 109–280, 120 Stat. 780; sec.

105(a), Pub. L. 110–458, 122 Stat. 5092. Secs.

2520.102–3, 2520.104b–1, and 2520.104b–3

also issued under 29 U.S.C. 1003, 1181–1183,

1181 note, 1185, 1185a–b, 1191, and 1191a–

c. Secs. 2520.104b–1 and 2520.107 also

issued under 26 U.S.C. 401 note; sec. 1510,

Pub. L. 105–34, 111 Stat. 1068.

■2. In § 2520.103–1, revise paragraphs

(a)(2), (b) introductory text, (b)(1), (c)(1),

(c)(2)(i), and (c)(2)(ii)(D) and (E) and add

paragraphs (c)(2)(ii)(F) and (G) to read as

follows:

§ 2520.103–1 Contents of the annual

report.

(a) * * *

(2) Under the authority of subsections

104(a)(2), 104(a)(3), and 110 of the Act,

section 1103(b) of the Pension

Protection Act of 2006, and section 202

of the SECURE Act, a simplified report,

limited exemption, or alternative

method of compliance is prescribed for

employee welfare and pension benefit

plans, as applicable. A plan filing a

simplified report or electing the limited

exemption or alternative method of

compliance shall file an annual report

containing the information prescribed in

paragraph (b) or (c) of this section, as

applicable, and shall furnish a summary

annual report as prescribed in

§ 2520.104b–10.

(b) Contents of the annual report for

plans with 100 or more participants

electing the limited exemption or

alternative method of compliance.

Except as provided in paragraphs (d)

and (f) of this section and in

§§ 2520.103–2, 2520.103–14, and

2520.104–44, the annual report of an

employee benefit plan covering 100 or

more participants at the beginning of the

plan year which elects the limited

exemption or alternative method of

compliance described in paragraph

(a)(2) of this section shall include:

(1) A Form 5500 ‘‘Annual Return/

Report of Employee Benefit Plan’’ and

any statements or schedules required to

be attached to the form, 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 SB (Single-

Employer Defined Benefit Plan

Actuarial Information), Schedule MB

(Multiemployer Defined Benefit Plan

and Certain Money Purchase Plan

Actuarial Information), Schedule MEP

(Multiple Employer Plan), Schedule R

(Retirement Plan Information), and

other financial schedules described in

§ 2520.103–10. See the instructions for

this form.

* * * * *

(c) * * *

(1) Except as provided in paragraphs

(c)(2), (d), (e), and (f) of this section, and

in §§ 2520.103–14, 2520.104–51,

2520.104–43, 2520.104–44, 2520.104a–

6, and 2520.104a–9, the annual report of

an employee benefit plan that covers

fewer than 100 participants at the

beginning of the plan year shall include

a Form 5500 ‘‘Annual Return/Report of

Employee Benefit Plan’’ and any

statements or schedules required to be

attached to the form, completed in

accordance with the instructions for the

form, including Schedule A (Insurance

Information), Schedule D (DFE/

Participating Plan Information),

Schedule I (Financial Information—

Small Plan), Schedule SB (Single

Employer Defined Benefit Plan

Actuarial Information), Schedule MB

(Multiemployer Defined Benefit Plan

and Certain Money Purchase Plan

Actuarial Information), Schedule MEP

(Multiple Employer Plan), and Schedule

R (Retirement Plan Information). See the

instructions for this form.

(2)(i) The annual report of an

employee pension benefit plan or

employee welfare benefit plan and that

covers fewer than 100 participants at the

beginning of the plan year and that

meets the conditions in paragraph

(c)(2)(ii) of this section with respect to

a plan year may, as an alternative to the

requirements of paragraph (c)(1) of this

section, meet its annual reporting

requirements by filing the Form 5500–

SF ‘‘Short Form Annual Return/Report

of Small Employee Benefit Plan’’ and

any statements or schedules required to

be attached to the form, Schedule SB

(Single Employer Defined Benefit Plan

Actuarial Information) and Schedule

MB (Multiemployer Defined Benefit

Plan and Certain Money Purchase Plan

Actuarial Information), completed in

accordance with the instructions for the

form. See the instructions for this form.

(ii) * * *

(D) Is not a multiemployer plan;

(E) Is not a plan subject to the Form

M–1 requirements under § 2520.101–2;

(F) Is not a multiple employer pension

plan, including a pooled employer plan

described in section 3(43) of the Act and

a multiple employer defined

contribution pension plan described in

§ 2510.3–55 of this chapter; and

(G) Is not a DCG reporting

arrangement described in § 2520.104–

51.

* * * * *

■3. In § 2520.103–5, revise paragraph

(a) introductory text to read as follows:

§ 2520.103–5 Transmittal and certification

of information to plan administrator for

annual reporting purposes.

(a) General. In accordance with

section 103(a)(2) of the Act, an

insurance carrier or other organization

which provides benefits under the plan

or holds plan assets, a bank or similar

institution which holds plan assets, or

a plan sponsor shall transmit and certify

such information as needed by the

administrator to file the annual report

under section 104(a)(1) of the Act and

§ 2520.104a–5, §2520.104a–6, or

§ 2520.104a–9:

* * * * *

■4. In § 2520.103–10:

■a. Revise paragraphs (a) and (b)(1) and

(2);

■b. Redesignate paragraph (c) as

paragraph (d);

■c. Add a new paragraph (c); and

■d. In newly redesiganted pargraph (d),

remove ‘‘paragraphs (b)(1), (b)(2) or

(b)(6)’’ and add ‘‘paragraph (b)(1), (2), or

(6)’’ in its place.

The revisions and addition read as

follows:

§ 2520.103–10 Annual report financial

schedules.

(a) General. The administrator of a

plan filing an annual report pursuant to

§ 2520.103–1(a)(2), the report for a

group insurance arrangement pursuant

to § 2520.103–2, or the report for a

defined contribution pension plan

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group (DCG) reporting arrangement

pursuant to § 2520.103–14, shall, as

provided in the instructions to the Form

5500 ‘‘Annual Return/Report of

Employee Benefit Plan,’’ include as part

of the report the separate financial

schedules described in paragraph (b) of

this section.

(b) * * *

(1) Assets held for investment. (i) A

schedule of all assets held for

investment purposes at the end of the

plan year (see § 2520.103–11) with

assets aggregated and identified by:

(A) Identity of issue, borrower, lessor

or similar party to the transaction

(including a notation as to whether such

party is known to be a party in interest);

(B) Description of investment

including maturity date, rate of interest,

collateral, par, or maturity value;

(including whether the investment is a

hard-to-value asset);

(C) Cost;

(D) Current value, and, in the case of

a loan, the payment schedule;

(E) The asset category in which the

asset was reported on the Schedule H;

(F) The Central Index Key (CIK)

number, Legal Entity Identifier (LEI)

Code, or National Association of

Insurance Commissioners (NAIC)

Company Code, or other government

registration or identity number for the

investment described in paragraphs

(b)(1)(i)(A) and (B) of this section, or if

no government number is available, a

market or exchange registration or

identity number; and

(G) In the case of individual account

plans, whether the investment is a

designated investment alternative (DIA)

or a qualified default investment

alternative (QDIA), and for each such

DIA and QDIA with respect to which

the return is not fixed, the total annual

operating expenses on the latest 404a–

5 statement provided to participants

during the plan year.

(ii) [Reserved]

(2) Assets acquired and disposed

within the plan year. (i) A schedule of

all assets acquired and disposed of

within the plan year (see § 2520.103–11)

with assets aggregated and identified by:

(A) Identity of issue, borrower, issuer

or similar party;

(B) Descriptions of investment

including maturity date, rate of interest,

collateral, par, or maturity value;

(C) Cost of acquisitions; and

(D) Proceeds of dispositions.

(ii) [Reserved]

* * * * *

(c) Presentation of investment assets

in commingled trusts and direct filing

entities (DFEs). (1) Except as provided

in the Form 5500 and the instructions

thereto or for filings by direct filing

entities or DCG reporting arrangements,

in the case of assets or investment

interests of two or more plans

maintained in one trust, entries on the

schedule of assets held for investment

purposes at the end of the plan year and

the schedule of assets acquired and

disposed of during the plan year shall

be completed by including the plan’s

allocable portion of the trust.

(2) In the case of direct filing entities

and DCG reporting arrangements

required to file a schedule of assets held

for investment purposes at the end of

the plan year and the schedule of assets

acquired and disposed of during the

plan year, the entries on the schedules

shall be completed by including the

assets held by the DFE or in the DCG

reporting arrangement’s trust and shall

include the number of plans with an

allocable interest in each listed

investment.

* * * * *

■5. Add § 2520.103–14 to read as

follows:

§ 2520.103–14 Contents of the annual

report for defined contribution pension plan

group (DCG) reporting arrangements.

(a) General. A defined contribution

pension plan group reporting

arrangement as described in § 2520.104–

51(c) (‘‘DCG reporting arrangement’’)

that files a consolidated annual report

pursuant to § 2520.104–51 shall include

in such report the items set forth in

paragraph (b) of this section, and shall

furnish a summary annual report as

prescribed in § 2520.104b–10.

(b) Contents of the annual report for

DCG reporting arrangement. (1) A Form

5500 ‘‘Annual Return/Report of

Employee Benefit Plan’’ and any

statements or schedules required to be

attached to the form, 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 DCG (Individual

Plan Information), Schedule R

(Retirement Plan Information), and the

other financial schedules referred to in

§ 2520.103–10, completed in accordance

with the instructions for the form.

(2) A report of an independent

qualified public accountant for the DCG

trust.

(3) Separate financial statements for

the DCG reporting arrangement trust

described in § 2520.104–51(c)(2)(i) (in

addition to the information required by

paragraph (b)(1) of this section), if such

financial statements are prepared in

order for the independent qualified

public accountant to form the opinion

required by section 103(a)(3)(A) of the

Act and paragraph (b)(6) of this section.

These financial statements shall include

the following:

(i) A statement of all trust assets and

liabilities at current value presented in

comparative form for the beginning and

end of the year. The statement of trust

assets and liabilities shall include the

assets and liabilities required to be

reported on the Form 5500; however,

the assets and liabilities may be

aggregated into categories in a manner

other than that used on Form 5500.

(ii) Separate or combined statements

of all trust income and expenses and

changes in net assets, which includes

the categories of income, expense, and

changes in assets required to be reported

on the Form 5500; however, the income,

expense, and changes in assets may be

aggregated into categories in a manner

other than that used on Form 5500.

(4) Notes to the financial statements

described in paragraph (b)(1) or (2) of

this section which contain a description

of the accounting principles and

practices reflected in the financial

statements and, if applicable, variances

from generally accepted accounting

principles; a description of the DCG

reporting arrangement including any

significant changes in the arrangement

made during the period and the impact

of such changes on benefits; a

description of material lease

commitments, other commitments, and

contingent liabilities; a description of

agreements and transactions with

persons known to be parties in interest;

a general description of priorities upon

termination of the DCG reporting

arrangement; an explanation of the

differences, if any, between the

information contained in the separate

financial statements and the assets,

liabilities, income, expenses and

changes in net assets as required to be

reported on the Form 5500; and any

other matters necessary to fully and

fairly present the financial condition of

the DCG reporting arrangement.

(5) In the case of a DCG reporting

arrangement some or all of the assets of

which are held in a pooled separate

account maintained by an insurance

carrier, or in a common or collective

trust maintained by a bank, trust

company or similar institution, a copy

of the annual statement of assets and

liabilities of such account or trust for

the fiscal year of the account or trust

which ends with or within the plan year

for which the annual report is made as

required to be furnished by such

account or trust under § 2520.103–5(c).

See §§ 2520.103–3 and 2520.103–4 for

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reporting requirements for plans some

or all of the assets of which are held in

a pooled separate account maintained

by an insurance company, or a common

or collective trust maintained by a bank

or similar institution, and see

§ 2520.104–51(b)(2) for when the term

‘‘DCG reporting arrangement’’ or ‘‘DCG’’

shall be used in place of the term

‘‘plan.’’

(6) In the case of a plan participating

in a DCG reporting arrangement

covering 100 or more participants at the

beginning of the plan year, the Schedule

DCG for each participating plan shall

include the following as provided in the

instructions to the Schedule DCG:

(i) A report of an independent

qualified public accountant for the

participating plan.

(ii) Separate financial statements and

financial schedules described in

§ 2520.103–10 for the plan, if such

financial statements and schedules are

prepared in order for the independent

qualified public accountant to form the

opinion required by section 103(a)(3)(A)

of the Act and paragraph (b)(6) of this

section. The financial statement shall

include the information set forth in

§ 2520.103–1(b)(2).

(iii) Notes to the financial statements

described in paragraph (b)(2)(i) of this

section, which contain the information

set forth in § 2520.103–1(b)(3).

(iv) In the case of a participating plan,

some or all of the assets of which are

held in a pooled separate account

maintained by an insurance company,

or a common or collective trust

maintained by a bank or similar

institution, the information described in

§ 2520.103–1(b)(4).

(c) Technical requirements. The

accountant’s report required for the DCG

trust and any participating plan subject

to the requirements in paragraph (b)(6)

of this section—

(1) Shall be dated;

(2) Shall be signed manually;

(3) Shall indicate the city and state

where issued;

(4) Shall identify without detailed

enumeration the financial statements

and schedules covered by the report;

(5) Shall state whether the audit was

made in accordance with generally

accepted auditing standards;

(6) Shall designate any auditing

procedures deemed necessary by the

accountant under the circumstances of

the particular case, which have been

omitted, and the reasons for their

omission. Authority for the omission of

certain procedures which independent

accountants might ordinarily employ in

the course of an audit made for the

purpose of expressing the opinions

required by paragraph (b)(5)(iii) of this

section is contained in § 2520.103–8;

and

(7) Shall state clearly:

(i) The opinion of the accountant in

respect of the financial statements and

schedules covered by the report and the

accounting principles and practices

reflected therein; and

(ii) The opinion of the accountant as

to the consistency of the application of

the accounting principles with the

application of such principles in the

preceding year, or as to any changes in

such principles which have a material

effect on the financial statements.

(8) Any matters to which the

accountant takes exception shall be

clearly identified, the exception thereto

specifically and clearly stated, and, to

the extent practicable, the effect of the

matters to which the accountant takes

exception on the related financial

statements given. The matters to which

the accountant takes exception shall be

further identified as to:

(i) Those that are the result of DOL

regulations; and

(ii) All others.

(d) Electronic filing requirement. See

§ 2520.104a–2 and the instructions for

the Form 5500 ‘‘Annual Return/Report

of Employee Benefit Plan’’ for electronic

filing requirements. The common plan

administrator for each plan whose

reporting obligations are satisfied by a

DCG filing under this section must

maintain an original copy of the DCG

filing, with all required signatures, as

part of the DCG’s records.

■6. Add § 2520.104–51 to read as

follows:

§ 2520.104–51 Alternative method of

compliance for defined contribution

pension plan group (DCG) reporting

arrangements.

(a) General. Under the authority of

section 110 of the Act and section 202

of the SECURE Act, the plan

administrator common to each plan

(‘‘common plan administrator’’), as

described in paragraph (c)(2)(iii) of this

section, satisfies the obligation to file an

annual report for each of the plans

participating in the DCG reporting

arrangement described in paragraph (c)

of this section if the participating plan

meets the requirements of paragraph (b)

of this section.

(b) Application. (1) The alternative

method of compliance set out in this

section is available only for an

individual account or defined

contribution pension plan in a plan year

in which:

(i) Such plan participates in a defined

contribution pension plan group (DCG)

reporting arrangement described in

paragraph (c) of this section; and

(ii) A consolidated annual report

containing the items set forth in

§ 2520.103–14 has been filed with the

Secretary of Labor in accordance with

§ 2520.104a–9 by the common plan

administrator (as described in paragraph

(c)(2)(iii) of this section) for all of the

plans participating in the DCG reporting

arrangement (as described in paragraph

(c) of this section).

(2) For purposes of this section, the

term ‘‘DCG reporting arrangement’’ or

‘‘common plan administrator’’ shall be

used in place of the terms ‘‘plan’’ and

‘‘plan administrator,’’ in §§ 2520.103–3,

2520.103–4, 2520.103–6, 2520.103–8,

2520.103–9, and 2520.103–10 and

elsewhere in subpart C of this part and

this subpart, as applicable.

(c) Defined contribution pension plan

group (DCG) reporting arrangement. An

arrangement is only a ‘‘DCG reporting

arrangement’’ if all plans participating

in the arrangement—

(1) Are individual account plans or

defined contribution plans as defined in

section 3(34) of the Act;

(2) Have—

(i) The same trustee as described in

section 403(a) of the Act (‘‘common

trustee’’) and trust(s) (‘‘common trust’’);

(ii) The same one or more named

fiduciaries as described in section

402(a) of the Act (‘‘common named

fiduciaries’’), except that nothing in this

paragraph (c)(2)(ii) precludes an

individual employer acting as an

additional named fiduciary with respect

to the individual plan it sponsors;

(iii) A designated plan administrator

that is the same plan administrator as

defined in section 3(16)(A) of the Act

(‘‘common plan administrator’’); and

(iv) Plan years beginning on the same

date (‘‘common plan year’’);

(3) Provide the same investments or

investment options (‘‘common

investments or investment options’’) to

participants and beneficiaries; and

(4) Have the investment assets held in

a single trust of the DCG reporting

arrangement, and the participating plan:

(i) Do not hold any employer

securities at any time during the plan

year;

(ii) At all times during the plan year,

are 100% invested in assets that have a

readily determinable fair market value

as described in § 2520.103–1(c)(2)(ii)(C);

(iii) Are either audited by an

independent qualified public

accountant (IQPA) or satisfies the audit

waiver conditions in § 2520.104–

46(b)(1)(i)(A)(1) and (b)(1)(i)(B) and (C);

(iv) Are not a multiemployer plan;

and

(v) Are not a multiple employer

pension plan, including a pooled

employer plan described in section

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3(43) of the Act and multiple employer

defined contribution pension plans

described in § 2510.3–55 of this chapter.

(d) Limitations. The alternative

method of reporting set out in this

section does not relieve the

administrator of a defined contribution

pension plan participating in a DCG

reporting arrangement described in

paragraph (c) of this section from any

other requirements of Title I of the Act,

including the provisions which require

that plan administrators furnish copies

of the summary plan description to

participants and beneficiaries (section

104(b)(1)), furnish certain documents to

the Secretary of Labor upon request

(section 104(a)(6)), authorize the

Secretary of Labor to collect information

and data from employee benefit plans

for research and analysis (section 513),

and furnish a copy of a summary annual

report to participants and beneficiaries

of the plan, as required by section

104(b)(3) of the Act.

■7. In § 2520.104a–5, revise paragraph

(a) introductoty text to read as follows:

§ 2520.104a–5 Annual reporting filing

requirements.

(a) Filing obligation. Except as

provided in §§ 2520.104a–6 and

2520.104a–9, the administrator of an

employee benefit plan required to file

an annual report pursuant to section

104(a)(1) of the Act shall file an annual

report containing the items prescribed

in § 2520.103–1 within:

* * * * *

■8. Add § 2520.104a–9 to read as

follows:

§ 2520.104a–9 Annual reporting for

defined contribution pension plan group

(DCG) reporting arrangements.

(a) General. A defined contribution

pension plan group (DCG) reporting

arrangement described in § 2520.104–

51(c) that files an annual report in

accordance with the terms of paragraphs

(b) and (c) of this section shall be

deemed to have filed such a report for

purposes of § 2520.104–51.

(b) Date of filing. The annual report

shall be filed within seven months after

the close of the plan year of the DCG

reporting arrangement, unless extended.

See ‘‘When to file’’ instructions of the

appropriate Annual Return/Report

Form.

(c) Where to file. The annual report

prescribed in § 2520.103–14 shall be

filed electronically in accordance with

the instructions to the Annual Return/

Report Form.

■9. In § 2520.104b–10:

■a. In paragraph (d)(3):

■i. Revise the ‘‘Summary Annual

Report for (name of plan)’’;

■ii. Add paragraphs 11 and 12

immediately following paragraph 10

under ‘‘Your Rights to Additional

Information’’; and

■iii. Remove the last undesignated

paragraph and add two undesignated

paragraphs in its place; and

■b. Remove the appendix to the

section; and

■c. Add table 1 at the end of the

section.

The revisions and additions read as

follows:

§ 2520.104b–10 Summary Annual Report.

* * * * *

(d) * * *

(3) * * *

Summary Annual Report for (name of

plan)

This is a summary of the annual

report [insert as applicable either Form

5500 Annual Return/Report of

Employee Benefit Plan or Form 5500–SF

Annual Return/Report of Small

Employee Benefit Plan] of [insert name

of plan and EIN/PN] for [insert period

covered by this report]. The [insert as

applicable either Form 5500 or Form

5500–SF] annual report has been filed

with the Employee Benefits Security

Administration, as required under the

Employee Retirement Income Security

Act of 1974 (ERISA). Your plan is a

[insert a brief description of the plan

based on the plan characteristic codes

listed for the plan on the Form 5500,

including whether it is a defined

contribution or defined benefit plan,

and whether the plan is a pooled

employer plan, another type of multiple

employer plan, a single employer plan].

[If the plan is participating in a DCG

reporting arrangement]:

Your plan participates in an annual

reporting arrangement that files a

consolidated Form 5500 Annual Report

for all the separate plans in the

arrangement. This summary includes

aggregate information on all the

participating plans from the

consolidated Form 5500. The

consolidated Form 5500 also includes a

separate schedule (Schedule DCG) for

each individual plan. As noted below

regarding your rights to additional

information, you have a right to receive

a copy of the Schedule DCG relating to

your plan on request from the plan

administrator.]

* * * * *

Your Rights to Additional Information

* * * * *

■11. a Schedule DCG for plans

participating in a consolidated group

Form 5500 filing that includes your plan

sponsor’s name, EIN, total number of

participants in your plan and basic

financial information about the plan.

■12. a Schedule MEP, including name

and EIN of the employers participating

in the MEP, each participating

employer’s percentage of the total

contributions (employer and employee)

made by all employer participating in

the MEP and aggregate account balance

for each of the employer participating in

the MEP.

* * * * *

[If the plan is participating in a DCG

reporting arrangement]:

You also have the legally protected

right to examine the annual report at the

main office of the plan (address), (at any

other location where the report is

available for examination), and at the

U.S. Department of Labor in

Washington, DC, or to obtain a copy

from the U.S. Department of Labor upon

payment of copying costs. Requests to

the Department should be addressed to:

Public Disclosure Room, Room N–1513,

Employee Benefits Security

Administration, U.S. Department of

Labor, 200 Constitution Avenue NW,

Washington, DC 20210. The annual

report is also available online at the

Department of Labor website

www.efast.dol.gov.

* * * * *

T

ABLE

1

TO

§ 2520.104

B

–10—T

HE

S

UMMARY

A

NNUAL

R

EPORT

(SAR) U

NDER

ERISA: A C

ROSS

-R

EFERENCE TO THE

A

NNUAL

R

EPORT

SAR item Form 5500 large plan filer line

items Form 5500 small plan filer line

items Form 5500–SF filer line items

A. Pension Plan:

1. Funding arrangement ......... Form 5500–9a .............................. Same ............................................ Not applicable.

2. Total plan expenses ........... Sch. H–2j ...................................... Sch. I–2j ........................................ Line 8h.

3. Administrative expenses ..... Sch. H–2i(5) .................................. Sch. I–2h ...................................... Line 8f.

4. Benefits paid ....................... Sch. H–2e(4) ................................ Sch. I–2e ...................................... Line 8d.

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T

ABLE

1

TO

§ 2520.104

B

–10—T

HE

S

UMMARY

A

NNUAL

R

EPORT

(SAR) U

NDER

ERISA: A C

ROSS

-R

EFERENCE TO THE

A

NNUAL

R

EPORT

—Continued

SAR item Form 5500 large plan filer line

items Form 5500 small plan filer line

items Form 5500–SF filer line items

5. Other expenses .................. Sch. H—Subtract the sum of

2e(4) & 2i(5) from 2j. Sch. I–2i ........................................ Line 8g.

6. Total participants ................ Form 5500–6f ............................... Same ............................................ Line 5b.

6. Value of plan assets (net):

a. End of plan year .......... Sch. H–1l [Col. (b)] ....................... Sch. I–1c [Col. (b)] ....................... Line 7c [Col. (b)].

b. Beginning of plan year Sch. H–1l [Col. (a)] ....................... Sch. I–1c [Col. (a)] ....................... Line 7c [Col. (a)].

8. Change in net assets ......... Sch. H—Subtract 1l [Col. (a)] from

1l [Col. (b)]. Sch. I—Subtract 1c [Col. (a) from

Col. (b)]. Line 7c—Subtract Col. (a) from

Col. (b).

9. Total income ....................... Sch. H–2d ..................................... Sch. I–2d ...................................... Line 8c.

a. Employer contributions Sch. H–2a(1)(A) & 2a(2) if appli-

cable. Sch. I–2a(1) & 2b if applicable ..... Line 8a(1) if applicable.

b. Employee contributions Sch. H–2a(1)(B) & 2a(2) if appli-

cable. Sch. I–2a(2) & 2b if applicable ..... Line 8a(2) & 8a(3) if applicable.

c. Participating employer’s

percentage of the total

contributions (employer

and employee) made

by all employers partici-

pating in a MEP.

Sch. MEP Line 2c ......................... Sch. MEP Line 2c ......................... Not applicable.

d. Aggregate account bal-

ance of the employer

participating in a MEP

(determined as the sum

of the account balances

of the employees of

such employer (includ-

ing the beneficiaries of

such employees).

Sch. MEP Line 2d ........................ Sch. MEP Line 2d ........................ Not applicable.

e. Gains (losses) from

sale of assets. Sch. H–2b(4)(C) ........................... Not applicable ............................... Not applicable.

f. Earnings from invest-

ments. Sch. H—Subtract the sum of

2a(3), 2b(4)(C) and 2c from 2d. Sch. I–2c ....................................... Line 8b.

11. Total insurance premiums Total of all Schs. A–6b ................. Total of all Schs. A–6b ................. Not applicable.

12. Unpaid minimum required

contribution (S–E plans) or

Funding deficiency (ME

plans):

a. S–E Defined benefit

plans. Sch. SB–39 ................................... Same ............................................ Same.

b. ME Defined benefit

plans. Sch. MB–10 .................................. Same ............................................ Not applicable.

c. Defined contribution

plans. Sch. R–6c, if more than zero ....... Same ............................................ Line 12d.

13. Individual plan information

for plans participating in a

DCG reporting arrangement.

Schedule DCG .............................. Same ............................................ Not applicable.

B. Welfare Plan:

1. Name of insurance carrier .. All Schs. A–1(a) ............................ Same ............................................ Not applicable.

2. Total (experience rated and

non-experienced rated) in-

surance premiums.

All Schs. A—Sum of 9a(1) and

10a. Same ............................................ Not applicable.

3. Experience rated premiums All Schs. A–9a(1) .......................... Same ............................................ Not applicable.

4. Experience rated claims ..... All Schs. A–9b(4) .......................... Same ............................................ Not applicable.

5. Value of plan assets (net):

a. End of plan year .......... Sch. H–11 [Col. (b)] ...................... Sch. I–1c [Col. (b)] ....................... Line 7c [Col. (b)].

b. Beginning of plan year Sch. H–11 [Col. (a)] ...................... Sch. I–1c [Col. (a)] ....................... Line 7c [Col. (a)].

6. Change in net assets ......... Sch. H—Subtract 1 [Col. (a)] from

1 [Col. (b)]. Sch. I—Subtract 1c [Col. (a)] from

1c [Col. (b)]. Line 7c—Subtract [Col. (a)] from

7c [Col. (b)].

7. Total income ....................... Sch. H–2d ..................................... Sch. I–2d ...................................... Line 8c.

a. Employer contributions Sch. H–2a(1)(A) & 2a(2) if appli-

cable. Sch. I–2a(1) & 2b if applicable ..... Line 8a(1) if applicable.

b. Employee contributions Sch. H–2a(1)(B) & 2a(2) if appli-

cable. Sch. I–2a(2) & 2b if applicable ..... Line 8a(2) if applicable.

c. Gains (losses) from

sale of assets. Sch. H–2b(4)(C) ........................... Not applicable ............................... Not applicable.

d. Earnings from invest-

ments. Sch. H—Subtract the sum of

2a(3), 2b(4)(C) and 2c from 2d. Sch. I–2c ....................................... Line 8b.

8. Total plan expenses ........... Sch. H–2j ...................................... Sch. I–2j ........................................ Line 8h.

9. Administrative expenses ..... Sch. H–2i(5) .................................. Sch. I–2h ...................................... Line 8f.

10. Benefits paid ..................... Sch. H–2e(4) ................................ Sch. I–2e ...................................... Line 8d.

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1

National Ambient Air Quality Standards for

Ozone, Final Rule, 80 FR 65292 (October 26, 2015).

Although the level of the standard is specified in

the units of ppm, ozone concentrations are also

described in parts per billion (ppb). For example,

0.070 ppm is equivalent to 70 ppb.

2

SIP revisions that are intended to meet the

applicable requirements of section 110(a)(1) and (2)

of the CAA are often referred to as infrastructure

SIPs and the applicable elements under section

110(a)(2) are referred to as infrastructure

requirements.

3

See North Carolina v. EPA, 531 F.3d 896, 909–

911 (D.C. Cir. 2008).

T

ABLE

1

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§ 2520.104

B

–10—T

HE

S

UMMARY

A

NNUAL

R

EPORT

(SAR) U

NDER

ERISA: A C

ROSS

-R

EFERENCE TO THE

A

NNUAL

R

EPORT

—Continued

SAR item Form 5500 large plan filer line

items Form 5500 small plan filer line

items Form 5500–SF filer line items

11. Other expenses ................ Sch. H—Subtract the sum of

2e(4) & 2i(5) from 2j. Sch. I–2i ........................................ Line 8g.

Signed at Washington, DC, this 2nd day of

September, 2021.

Ali Khawar,

Acting Assistant Secretary, Employee Benefits

Security Administration, U.S. Department of

Labor.

[FR Doc. 2021–19713 Filed 9–14–21; 8:45 am]

BILLING CODE 4510–29–P

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Part 52

[EPA–R01–OAR–2021–0580; FRL–8967–01–

R1]

Air Plan Approval; Rhode Island; 2015

Ozone NAAQS Interstate Transport

Requirements

AGENCY

: Environmental Protection

Agency (EPA).

ACTION

: Proposed rule.

SUMMARY

: The Clean Air Act (CAA)

requires each State Implementation Plan

(SIP) to contain adequate provisions

prohibiting emissions that will have

certain adverse air quality effects in

other states. The State of Rhode Island

made a submission to the

Environmental Protection Agency (EPA)

to address these requirements for the

2015 ozone National Ambient Air

Quality Standards (NAAQS). EPA is

proposing to approve the submission for

Rhode Island as meeting the

requirement that each SIP contain

adequate provisions to prohibit

emissions that will significantly

contribute to nonattainment or interfere

with maintenance of the 2015 ozone

NAAQS in any other state.

DATES

: Written comments must be

received on or before October 15, 2021.

ADDRESSES

: Submit your comments,

identified by Docket ID No. EPA–R01–

OAR–2021–0580 at https://

www.regulations.gov, or via email to

simcox.alison@epa.gov. For comments

submitted at Regulations.gov, follow the

online instructions for submitting

comments. Once submitted, comments

cannot be edited or removed from

Regulations.gov. For either manner of

submission, EPA may publish any

comment received to its public docket.

Do not submit electronically any

information you consider to be

Confidential Business Information (CBI)

or other information whose disclosure is

restricted by statute. Multimedia

submissions (audio, video, etc.) must be

accompanied by a written comment.

The written comment is considered the

official comment and should include

discussion of all points you wish to

make. EPA will generally not consider

comments or comment contents located

outside of the primary submission (i.e.,

on the web, cloud, or other file sharing

system). For additional submission

methods, please contact the person

identified in the

FOR FURTHER

INFORMATION CONTACT

section. For the

full EPA public comment policy,

information about CBI or multimedia

submissions, and general guidance on

making effective comments, please visit

https://www.epa.gov/dockets/

commenting-epa-dockets. Publicly

available docket materials are available

at https://www.regulations.gov or at the

U.S. Environmental Protection Agency,

EPA Region 1 Regional Office, Air and

Radiation Division, 5 Post Office

Square—Suite 100, Boston, MA. EPA

requests that if at all possible, you

contact the contact listed in the

FOR

FURTHER INFORMATION CONTACT

section to

schedule your inspection. The Regional

Office’s official hours of business are

Monday through Friday, 8:30 a.m. to

4:30 p.m., excluding legal holidays and

facility closures due to COVID–19.

FOR FURTHER INFORMATION CONTACT

:

Alison C. Simcox, Air Quality Branch,

U.S. Environmental Protection Agency,

EPA Region 1, 5 Post Office Square—

Suite 100, (Mail code 05–2), Boston, MA

02109—3912, tel. (617) 918–1684, email

simcox.alison@epa.gov.

SUPPLEMENTARY INFORMATION

:

Throughout this document whenever

‘‘we,’’ ‘‘us,’’ or ‘‘our’’ is used, we mean

EPA.

Table of Contents

I. Background

II. Rhode Island Submission

III. EPA Evaluation of Rhode Island’s

Submission

IV. Proposed Action

V. Statutory and Executive Order Reviews

I. Background

On October 1, 2015, EPA promulgated

a revision to the ozone NAAQS (2015

ozone NAAQS), lowering the level of

both the primary and secondary

standards to 0.070 parts per million

(ppm).

1

Section 110(a)(1) of the CAA

requires states to submit, within 3 years

after promulgation of a new or revised

standard, SIP submissions meeting the

applicable requirements of section

110(a)(2).

2

One of these applicable

requirements is found in section

110(a)(2)(D)(i)(I), otherwise known as

the good neighbor provision, which

generally requires SIPs to contain

adequate provisions to prohibit in-state

emissions activities from having certain

adverse air quality effects on other states

due to interstate transport of pollution.

There are two so-called ‘‘prongs’’ within

CAA section 110(a)(2)(D)(i)(I). A SIP for

a new or revised NAAQS must contain

adequate provisions prohibiting any

source or other type of emissions

activity within the state from emitting

air pollutants in amounts that will:

Significantly contribute to

nonattainment of the NAAQS in another

state (prong 1) or interfere with

maintenance of the NAAQS in another

state (prong 2). EPA and states must give

independent significance to prong 1 and

prong 2 when evaluating downwind air

quality problems under CAA section

110(a)(2)(D)(i)(I).

3

We note that EPA has addressed the

interstate transport requirements of

CAA section 110(a)(2)(D)(i)(I) with

respect to prior ozone NAAQS in

several regional regulatory actions,

including the Cross-State Air Pollution

Rule (CSAPR), which addressed

interstate transport with respect to the

1997 ozone NAAQS as well as the 1997

and 2006 fine particulate matter

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Published date	15 September 2021
Citation	86 FR 51284
Record Number	2021-19713
Section	Proposed rules
Court	Employee Benefits Security Administration,Labor Department

Annual Reporting and Disclosure

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