Department of Labor issues final rules on changes to 2023 Form 5500, Form 5500-SF Employee Benefit Plan reports

WASHINGTON – The U.S. Department of Labor, the IRS and the Pension Benefit Guaranty Corporation today released Federal Register notices that announce changes to the 2023 Form 5500 Annual Return/Report of Employee Benefit Plan and Form 5500-SF Short Form. These changes are estimated to reduce overall filing costs for employee benefit plans by $95 million annually.

The announcement marks the third and final phase of implementation of a Sept. 2021 regulatory proposal, which included changes related to provisions in the Setting Every Community Up for Retirement Enforcement Act, commonly known as the SECURE Act, which affected annual reporting requirements under the Employee Retirement Income Security Act and the Internal Revenue Code.

The first two phases of implementation included publication of Federal Register notices in Dec. 2021 for Phase I and May 2022 for Phase II, respectively, to adopt changes for the 2021 and 2022 Form 5500 Returns/Reports. Today’s Phase III announcement features a Notice of Final Forms Revisions from the department, IRS and PBGC for the 2023 plan year forms and instructions and a Notice of Final Rulemaking by the department that makes corresponding changes to annual reporting regulations under Title I of ERISA.

“The form changes and regulatory amendments, especially those on multiple-employer plan reporting, improve the Form 5500 as a critical oversight, public disclosure and policy data tool,” said Assistant Secretary for Employee Benefits Security Lisa M. Gomez.

The 2023 plan year reports – which generally will be filed beginning in July 2024 for calendar year plans – include the following changes:

• A consolidated Form 5500 reporting option for certain groups of defined contribution retirement plans, improved reporting by pooled employer plans and other multiple employer plans.
• A change in the participant-counting methodology for determining eligibility for simplified reporting alternatives available to “small plans,” which are generally plans with fewer than 100 participants.
• A breakout of reporting on administrative expenses paid by the plan on the plan’s financial statements.
• Further improvements in financial and funding reporting by PBGC-covered defined benefit plans.
• The addition of selected Internal Revenue Code compliance questions to improve tax oversight and compliance of tax-qualified retirement plans. 
• Technical and conforming changes as part of the annual rollover of forms and instructions.

Additionally, technical adjustments were made to the Federal Register notices to address certain provisions in SECURE Act 2.0 of 2022 on Code section 403(b) multiple employer plans, including pooled employer plans, minimum required distributions and audit requirements for plans in defined contribution group reporting arrangements.

The Federal Register notices, Document #2023-02653 for the Notice of Final Forms Revision and Document #2023-02652 for Notice of Final Rulemaking, also include appendices that describe the changes to the forms and instructions as well as a regulatory impact and paperwork burden analyses. A more detailed summary of the annual reporting changes is included in a fact sheet posted on the department’s website today. Mock-ups of the forms and instructions will be available at reginfo.gov as part of the Paperwork Reduction Act clearance process. The release of “for information-only” copies of the forms and instructions will happen later in 2023.