Certain employers must submit a Internal Revenue Service (IRS) Health and Welfare Form 5500 (“Form 5500”) to annually report certain information on their employee benefit plans to the Department of Labor. Employers whose plan year ended on December 31, 2019 must file their Form 5500 by July 31, 2020 (or October 15, 2020 with an extension).

Compliance Snapshot

  • Employers who sponsor health plans with more than 100 participants on the first day of the plan are required to file a Health and Welfare Form 5500.
  • The Form 5500 is due the last day of the 7th month after the end of the plan year (for employers with calendar year plans, the Form 5500 is due July 31st, or October 15th with an extension).

Frequently Asked Questions

Which employers must file a Form 5500? 

Employers who sponsor plans that cover 100+ plan participants on the first day of the plan year and plans that pay benefits from a trust (no matter how many participants are enrolled) must file a Form 5500.  

It is important to note that plans that are “wrapped” in a wrap document (i.e. wrap summary plan description or wrap SPD) must  include all such plans in the Form 5500 filing, even if only one plan has 100+ participants. This means that if an employer has a wrap SPD that includes their medical, dental and vision plans, they must report on all plans in Form 5500 if any one of their plans have more than 100 participants on the first day of the plan year.  

Who are plan participants? 

Participants are employees that are enrolled in the plan, which includes former employees who are receiving COBRA group health continuation coverage benefits. Covered dependents are not counted as participants. 

When is the Form 5500 due? 

The deadline for filing Form 5500 is the last day of the seventh month after the plan year ends. For calendar year plans, the deadline is July 31st; however, if an extension request is filed prior to the original due date, the deadline may be extended an additional two and a half months. As such, the deadline for a calendar year plan would be October 15th for employers that have received a filing extension.

Is there a penalty for filing the Form 5500 late? 

The Department of Labor (DOL) can assess penalties of up to $2,233 (2020) for each day a Form 5500 is not filed. Employers who voluntarily file their Form 5500 after the due date under the DOL’s voluntary correction program (DVCP) can pay a reduced penalty of $10 for each late day, up to $2,000 per year.

Are employers required to keep copies of their 5500 filings? 

Yes, employers must keep a signed copy of the original Form 5500 filing on file for at least 6 years from the date of filing.

Employer Responsibility

Employers should always be sure to review the Form 5500 carefully before filing. The Form is signed under penalty of perjury by the plan sponsor (i.e.the employer). Employers are ultimately responsible for the Form 5500 filing and its contents, even if a draft is prepared by a third party administrator (TPA), broker, or other vendor.

For Sequoia clients only

  • Sequoia works with an outside CPA firm to prepare Form 5500 for employers to review. It is extremely important that employers review the Form 5500 with their preferred counsel before filing.
  • Sequoia requests a filing extension for most clients to ensure there is sufficient time to gather documents from the carriers. As such, the Form 5500 filing deadline for most Sequoia clients with a calendar year plan will be October 15th.

Additional Resources 

Disclaimer: This content is intended for informational purposes only and should not be construed as legal, medical or tax advice. It provides general information and is not intended to encompass all compliance and legal obligations that may be applicable. This information and any questions as to your specific circumstances should be reviewed with your respective legal counsel and/or tax advisor as we do not provide legal or tax advice. Please note that this information may be subject to change based on legislative changes. © 2020 Sequoia Benefits & Insurance Services, LLC. All Rights Reserved

Emerald Law – Emerald is a Client Compliance Consultant for Sequoia, where she works with our clients to optimize and streamline benefits compliance. In her free time, Emerald enjoys stand-up comedy, live music and writing non-fiction.