The 2016 Form 5500 deadline has come and gone for calendar year taxpayers, and a number of them revealed outdated fidelity bonds or retirement plans without bonds at all.
The fidelity bond requirement is high up on the Department of Labor’s compliance priorities so it’s not a stretch to assume that the Department of Labor monitors this item on Form 5500. 2016 is history but it’s not too late to meet this important compliance requirement. Here are the basics:
- All persons, including fiduciaries, who handle funds or other property of an employee benefit plan (“called plan officials”) have to be bonded unless they are covered by an exemption.
- Each plan official is required to be bonded for at least 10% of the amount he or she handles, but in no event less than $1,000.
- The maximum bond amount required under section 412 with regard to any one plan is $500,000 per plan official, or $1 million per plan official in the case of a plan that holds employer securities.
The details can be found in our NBSI ERISA Bonding FAQs