Under the requirements of ERISA (Employment Retirement Income Security Act) Section 103, employee benefit plans with 100 or more participants are considered ‘large’ plans. These large plans must have an employee benefit plan audit performed by an independent certified public accountant. They also must file a Form 5500 annual report, a government form jointly developed by the Department of Labor (DOL) and the Internal Revenue Service (IRS).
Plans with fewer than 100 participants at the beginning of the year are considered ‘small’ plans and are eligible for the Small Pension Plan Audit Waiver. The Department of Labor (DOL) however has identified the range of 80 – 120 participants (this number is determined at the start of the plan year) as a grey area. In this grey area, a company has the option to continue as a ‘small’ plan or elect ‘large’ plan status. The choices for a plan falling into the 80 – 120 participant range are as follows: