Plan Sponsor
News

As a plan administrator, you have a lot on your plate. One way to ease your burden is to make the most of the tools and resources that come with your Mutual of America retirement plan. This includes our Payroll Integration service, which makes it easy for you to transfer employee information securely from your payroll to your retirement plan.

You may be familiar with the advantages Payroll Integration provides, including the ability to help you:

Reduce errors by eliminating repetitive, manual data entry.
Increase efficiency and avoid regulatory issues by ensuring employee contributions are invested on a timely basis.
Streamline plan administration by making it easier to track participant eligibility, enrollment and loan balances.

What you may not realize is how our Payroll Integration service can also deepen the value of your retirement plan and help you achieve important organizational goals by making it easier for you to:

Take the pulse of plan health by offering you plan participation details. If needed, you can use that information to drive higher levels of employee engagement with features like automatic enrollment.
Measure plan effectiveness by providing a baseline of metrics, against which you can track progress, identify trends and compare your 401(k) or 403(b) to retirement plans of similar sizes.
Boost your competitive advantage by offering a plan that will help you attract and retain qualified workers.
Improve participants’ retirement readiness by helping you determine whether your employees are leveraging their plan to build financial security for the future.

The goal of Mutual of America’s Payroll Integration service is simple: to provide the tools and resources you need to develop, maintain and grow a healthy and compliant retirement plan. To learn how Payroll Integration can help you, contact your local Mutual of America representative today.

As you know, Department of Labor rules require all plans covered by the Employee Retirement Income Security Act (ERISA) of 1974 to file a Form 5500 Annual Return/Report. Plans with 100 or more total participants at the beginning of the plan year* (i.e., a “large plan”) are also required to include a report of an independent qualified public accountant (audit report).

For large plans, a plan audit can be a complex and time-consuming process that may require plan sponsors to provide documents, schedules and information to their plan auditor. In addition, plan auditors may ask questions related to a range of topics, including plan reporting, governance, service providers, internal controls and fraud.

That’s why it’s critical that you work closely with your plan auditor and your local Mutual of America representative throughout the audit process. You should also ensure that plan officials are sufficiently bonded.

Getting Started
To help you begin preparing for a Form 5500 Annual Return/Report Independent Audit, here are three important points to consider:

1. Start Early—Gather all the required data and information including:

Previous year’s Form 5500 and audit report (as appropriate)
Executed copies of the latest plan documents and amendments
Copy of the Summary Plan Description (SPD) and any Summaries of Material Modification (SMM)
Sample plan enrollment packages
Copy of Service Organization Control Report (SOC-1) from third-party administrators and service providers
Pension Fund Report or Trust Statement

2. Prepare Yourself—Some of the key questions your auditor might ask are:

Have there been any changes in plan status?
Have any amendments been made to the plan?
Have there been any changes in investment policies or practices?
Have all salary reduction contributions, including amounts remitted to satisfy loan repayments, been submitted to the plan on a timely basis?

3. Be Protected—ERISA requires plan fiduciaries and any other person who handles plan assets to obtain and maintain a bond to provide protection to the plan against loss by reason of acts of fraud or dishonesty. The persons to be bonded include those designated to have responsibility for the ultimate control, management or disposition of the plan assets, referred to in ERISA as “plan
officials.” In general, the amount of the bond must be at least 10% of the value of the plan assets held under the contract, but not less than $1,000 or more than $500,000.

*The audit report requirement generally applies to plans that cover 100 or more total participants at the beginning of the plan year (counting all employees who are eligible to contribute to the plan, whether they do so or not, and former employees and beneficiaries who have a balance under the plan).

Are you aware that the IRS and Treasury Department announced important news about tax credits under the American Rescue Plan Act of 2021 (ARP) in April? In brief, tax credits may be available to help small and midsize employers, and certain governmental employers, that pay wages for sick and family leave to employees who take leave for COVID-19-related reasons between April 1, 2021, and September 30, 2021.

Eligible employers, including businesses and tax-exempt organizations with fewer than 500 employees, can receive a tax credit for providing paid time off for each employee receiving the COVID-19 vaccine and for any time needed to recover from the vaccine. For example, under the ARP, if an eligible employer offers employees a paid day off to receive a COVID-19 vaccination, the employer can claim a refundable tax credit equal to the wages paid to those employees for that day (up to certain limits).

The IRS points out that the paid leave credits are tax credits against the employer’s share of the Medicare tax. The tax credits are refundable, which means the employer is entitled to payment of the full amount of the credits if it exceeds the employer’s share of the Medicare tax.

To claim the credit, or to learn more about the details of the tax credit as it relates to paid sick leave and paid family leave, please visit irs.gov.

The tax information contained herein is for informational purposes only. You should consult your financial adviser or attorney regarding your individual circumstances.