Filing Extensions to July 15th for Approaching Form 5500 and PBGC Deadlines

A pair of government releases provides Form 5500 filing deadline relief for employee benefit plans, and PBGC filing relief for pension plans.

On April 9th, the IRS released Notice 2020-23, in which the Secretary of the Treasury determined that any person required to perform a time-sensitive action between April 1, 2020 and July 15, 2020 is affected by the Coronavirus/COVID-19 emergency. That includes filing a Form 5500 for an employee benefit plan, among other things. Any filing that is due on or after April 1, 2020, and before July 15, 2020, is automatically postponed to July 15, 2020. This is true for original filing deadlines and those obtained via a previous filing for extension. It is also automatic, so there is no need to contact the IRS or file any extension forms.

Filing Extensions to July 15th for Approaching Form 5500 and PBGC Deadlines

On April 10th, in Press Release Number 20-02, the Pension Benefit Guaranty Corporation (PBGC) announced it is offering flexibility to pension plan sponsors in response to the Coronavirus/COVID-19 outbreak.  Any deadlines for upcoming premium payments, and for other filings that originally fell on or after April 1, and before July 15, 2020, have been extended to July 15, 2020. So this includes regular premium filings as well as 4010 filings, but there are exceptions for filings that the PBGC requires related to tracking possible high risk of harm to participants or the PBGC’s insurance program. Some examples of exceptions are notification of large missed contributions through Form 200 and advanced notice of reportable events through Form 10-Advance. For a list of filings not covered by disaster relief announcements, see the PBGC’s Exceptions List.

These two releases provide welcome news for benefit plan sponsors with original deadlines approaching very quickly. However, it does not address deadlines for sponsors of plans with calendar year measurement periods. As more unfolds about how and when the stay-at-home requirements begin to be lifted, we may see additional deadline relief from the IRS and PBGC. Findley will continue to monitor these events and keep you updated.

Questions? Contact the Findley consultant you normally work with, or contact Colleen Lowmiller at colleen.lowmiller@findley.com, 216.875.1913.

Published April 14, 2020

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Employee Benefit Plan Limits for 2020

Findley is pleased to provide you the following 2020 limits (and comparable 2019 figures) for various employee benefit plans and Social Security.

Employee Benefit Plans20192020
401(k) elective deferral dollar limit$ 19,000$ 19,500
403(b) elective deferral dollar limit 1$ 19,000$ 19,500
457 eligible plan maximum deferral limit$ 19,000$ 19,500
401(k), 403(b), state and local government 457, and 408(p)
catch-up elective deferral (must be at least age 50)
$ 6,000$ 6,500
Defined benefit plans – maximum annual benefit$ 225,000$ 230,000
Defined contribution plans – maximum annual addition$ 56,000$ 57,000
Annual compensation limit$ 280,000$ 285,000
Highly compensated employee 2$ 125,000$ 130,000
SIMPLE retirement accounts – maximum elective deferrals$ 13,000$ 13,500
Key Employee$ 180,000$ 185,000
Social Security20192020
Social Security taxable wage base 3
Exempt earnings under the Social Security earnings test
$ 132,900$ 137,700
Under Social Security retirement age (SSRA) 4,5$ 17,640$ 18,240
Year in which SSRA is attained (per month) 6$ 3,910$ 4,050
SSRA and olderallall

1 May be increased by as much as $3,000 in certain situations.
2 Compensation threshold used to determine next year’s HCEs.
3 Employers and employees each pay 6.2% Social Security tax on earnings up to this level. All earnings are subject to an additional 1.45% Medicare tax, which is also paid by both employers and employees. Medicare tax rate increases by .9% if the taxpayer’s AGI exceeds: $250,000 if filing a joint return; $125,000 if married filing separately, and $200,000 for any other filing status.
4 SSRA for those born 1943 through 1954 is 66. SSRA increases to age 67 for those with later birth years.
5 In general, $1 of the Social Security benefit is lost for each $2 of earnings over threshold before the year SSRA is attained.
6 In the year SSRA is attained, $1 of the Social Security benefit is lost for each $3 of earnings over the threshold during the months before the individual’s SSRA occurs.

Part D Standard Benefit20192020
Deductible$ 415$ 435
Initial Coverage Limit$ 3,820$ 4,020
Maximum out-of-pocket threshold$ 5,100$ 6,350
Spending before catastrophic coverage$ 7,653.75$ 9,038.75
Retiree drug subsidy (RD) amounts
Cost threshold
Cost limit

$ 415
$ 8,500


$ 435
$ 8,950

Health Savings Accounts20192020
Minimum deductible to be a qualified high deductible health plan
Self-only coverage
Family coverage

$ 1,350
$ 2,700

$ 1,400
$ 2,800
Maximum annual HSA contribution
(excluding catch-up contribution)
Self-only coverage
Family coverage

$ 3,500
$ 7,000

$ 3,550
$ 7,100
Annual catch-up contribution for individuals age55 or older (per person)$ 1,000$ 1,000
Out-of-pocket maximums
Self-only coverage
Family coverage

$ 6,750
$ 13,500

$ 6,900
$ 13,800

Posted November 6, 2019

© 2019 Findley. All rights reserved.

Employee Benefit Plan Limits for 2019

Findley is pleased to provide you the following 2019 limits (and comparable 2018 figures) for various employee benefit plans and Social Security.

Employee Benefit Plans 2018 2019
401(k) elective deferral dollar limit $ 18,500 $ 19,000
403(b) elective deferral dollar limit 1 $ 18,500 $ 19,000
457 eligible plan maximum deferral limit $ 18,500 $ 19,000
401(k), 403(b), state and local government 457, and 408(p)
catch-up elective deferral (must be at least age 50)
$  6,000 $  6,000
Defined benefit plans – maximum annual benefit $ 220,000 $ 225,000
Defined contribution plans – maximum annual addition $ 55,000 $ 56,000
Annual compensation limit $ 275,000 $ 280,000
Highly compensated employee 2 $ 120,000 $ 125,000
SIMPLE retirement accounts – maximum elective deferrals $ 12,500 $ 13,000
Key Employee $ 175,000 $ 180,000
Social Security 2018 2019
Social Security taxable wage base 3
Exempt earnings under the Social Security earnings test
$ 128,400 $ 132,900
Under Social Security retirement age (SSRA) 4,5 $ 17,040 $ 17,640
Year in which SSRA is attained (per month) 6 $ 3,780 $ 3,910
SSRA and older all all

1 May be increased by as much as $3,000 in certain situations.
2 Compensation threshold used to determine next year’s HCEs.
3 Employers and employees each pay 6.2% Social Security tax on earnings up to this level. All earnings are subject to an additional 1.45% Medicare tax, which is also paid by both employers and employees. Medicare tax rate increases by .9% if the taxpayer’s AGI exceeds: $250,000 if filing a joint return; $125,000 if married filing separately, and $200,000 for any other filing status.
4 SSRA for those born 1943 through 1954 is 66. SSRA increases to age 67 for those with later birth years.
5 In general, $1 of the Social Security benefit is lost for each $2 of earnings over threshold before the year SSRA is attained.
6 In the year SSRA is attained, $1 of the Social Security benefit is lost for each $3 of earnings over the threshold during the months before the individual’s SSRA occurs.

Part D Standard Benefit 2018 2019
Deductible $ 405 $ 415
Initial Coverage Limit $ 3,750 $ 3,820
Maximum out-of-pocket threshold $ 5,000 $ 5,100
Spending before catastrophic coverage $7,508.75 $ 7,653.75
Retiree drug subsidy (RD) amounts
Cost threshold
Cost limit

$ 405
$ 8,350

$ 415
$ 8,500

Health Savings Accounts 2018 2019
Minimum deductible to be a qualified high deductible health plan

Self-only coverage
Family coverage

$ 1,350
$ 2,700

$ 1,350
$ 2,700

Maximum annual HSA contribution
(excluding catch-up contribution)
Self-only coverage
Family coverage

$ 3,450
$ 6,900

$ 3,500
$ 7,000

Annual catch-up contribution for individuals age 55
or older (per person)
$ 1,000 $ 1,000
Out-of-pocket maximums

Self-only coverage
Family coverage

$  6,650
$ 13,300

$  6,750
$ 13,500

For More Information

Posted November 1, 2019

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© 2018 Findley. All rights reserved.

A Hidden Hazard of Plan Administration—A Mishandled Power of Attorney

Plan sponsors have a lot to think about with the administration of their employee benefit plans. There may be loans, hardship distributions, beneficiary designations, and numerous optional benefit forms. It can spin heads. Fortunately, federal law (i.e., ERISA and the Internal Revenue Code) generally governs all of these events, so even if you are a plan sponsor with participants in multiple states, you know that you will be looking solely at federal law when a participant makes certain requests under the plan.

When it comes to a power of attorney, state laws govern, and your work becomes a bit more burdensome.

When those requests are being made by a participant’s agent under a power of attorney, however, a different analysis must be performed. When it comes to a power of attorney, state laws govern, and your work becomes a bit more burdensome.

A power of attorney (POA) is a formal written grant of authority from an individual (sometimes referred to as the principal) to his or her agent in order for the agent to act on the individual’s behalf in financial, business, or other matters. A POA can be a general grant of authority, or it can be quite narrow, such as a POA for the purpose of transferring a vehicle title. Plan administrators commonly see general POAs and have the task of deciding, for example, if the agent’s completion of a benefit election form or a loan application is authorized by the POA.

The reason “getting it right” is so important is that the failure to appropriately determine the validity of a POA, leaves plans at legal risk. Imagine issuing a substantive plan loan to a participant under what is assumed to be a valid POA from a son that the administrator knows is on the beneficiary form. The administrator thinks, therefore, the POA must be valid. The participant then dies, and the primary beneficiary informs the plan administrator that the loan actually went to his brother, a contingent beneficiary, under an invalid POA. Imagine the plan sponsor having to restore the funds (plus interest) to the participant’s account for distribution to the rightful beneficiary. It could happen.

When it comes to determining the validity of a POA, it’s not worth cutting corners. Analyzing a POA can be time-consuming under arcane law, or it can be relatively simple. The good news is the trend favors more streamlined administration of POAs submitted to a plan.

Currently, there are 26 states that have enacted the Uniform Power of Attorney Act (Act). Two more states and the District of Columbia have introduced the Act. Over time, more and more POAs will follow the Act’s form, which will ease the burden of reviewing POAs. Plan administrators will be able to adopt a checklist of the Act’s requirements for a valid POA. For now, a plan administrator can be faced with various POA forms— even from states that have adopted the Act more recently. That’s because the POA might have been executed prior to the state’s adoption of the Act, which would subject its review to pre-Act law.

After determining the governing state law and the date of the POA, the plan administrator needs to determine if the state law’s requirement for a valid POA have been met. These requirements may include, for example, notarization or witnesses. If notarization is required, the state’s notary laws then must be consulted to determine if the notarization is valid. Even where notarization is not required, a notarization of the POA should be reviewed to determine its validity, as the POA was apparently intended to be notarized.

Once the POA’s form has been determined to be valid, the more difficult task comes with determining if the agent’s act is authorized by the POA.

Ideally, the POA authorizes any and all actions with respect to the specific retirement plan and the participant’s benefits at issue. That’s rarely the case. A plan administrator must look at the listed areas where agency is given as well as the intent of the POA as a whole. Does the POA mean to encompass any and all acts that the participant could do with respect to the listed matters? Does it include a reference to retirement benefits? A potential “landmine” comes from an agent’s request to change a beneficiary under a POA (noting that the Act specifically requires an affirmative statement in the POA to cover this situation).

The responses of plan sponsors to these questions may fall on a spectrum. One plan sponsor may be comfortable with “stretching” to see that the agency is authorized in a POA that encompasses all financial matters, while another plan sponsor will only feel comfortable with a POA that lists retirement matters. Needless to say, the more specificity, the better.

As plan sponsors and administrators, you are the plan’s fiduciaries who are ultimately responsible for determining the validity of a POA. If you haven’t already done so, determine who is reviewing the POAs submitted to your plan. Make sure there is a process that considers the state law applicable to POAs and notarization. You may want to consider creating POA policies and procedures and designating a person who can make the tough calls on the POAs that are not straightforward. Making sure your plan’s POAs are handled appropriately protects your plan’s integrity and can save headaches and expenses down the line.

Questions? Please contact the Findley consultant you regularly work with or Sheila Ninneman at Sheila.Ninneman@findley.com or 216.875.1927.

Posted September 19, 2018

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