By Beth Harrington, President, Benefit Resources, Inc.

If you sponsor a retirement plan, then you have a lot of responsibilities.  Beyond making contributions every pay period, the fourth quarter of each plan year brings additional requirements.  Benefit Resources, Inc. (BRI) is a Sacramento-based Third Party Administration (TPA) firm with 30 years’ experience helping business owners meet these annual requirements as they maintain low-cost retirement plans that exceed their expectations. 


As a Plan Sponsor you have the ultimate responsibility of knowing your plan is running properly.  A good TPA will help you meet your operational responsibilities which include:

  • Plan documents – You should retain a copy of all historical plan documents and amendments. Documents are required to be updated periodically, so pay close attention to those requirements.  At BRI we sponsor pre-approved retirement plan documents and post copies to our secure web portal for quick and easy access.
  • Census data – Review the information about each employee on payroll to confirm eligibility for the plan. At BRI we check to make sure that all dates of birth, hire dates, termination/rehire dates, and hours look reasonable.  If we have any questions, we ask!
  • Highly Compensated and Key Employees – It is important for compliance testing to properly identify Highly Compensated and Key Employees. The definitions of each are different, may change from year to year, and even extend to certain family members in certain situations.  At BRI we will make the determination of the Highly Compensated and Key employees on behalf of our clients.
  • Compensation check – It sounds simple, but this is a very challenging area and the IRS will check to make sure that all compensation is included properly. At BRI we confirm that the compensation records that you provide to us for testing and contribution calculations for the plan tie out to your annual payroll records.
  • Deposit timing – Money withheld from an employee’s paycheck must be remitted to the plan within 7-business days. At BRI we provide our clients with a deposit reconciliation worksheet that automatically calculates the number of days from pay date to deposit so we may confirm compliance with the deposit timing rules.
  • Contributions – Employer contributions to the plan may be fixed or discretionary, dependent or independent of employee participation. There are a variety of options available under the regulations and choosing the wrong one may result in an unnecessarily expensive contribution or a missed opportunity.  At BRI we work with our clients to maintain the plan that best meets their goals and intent.  We run calculations and what-if scenarios for your year-end tax planning to provide the tools necessary to choose the right option each year.
  • ERISA Bond – The Department of Labor requires that all plans with individual trustees are bonded to protect participants from malfeasance. At least 10% of the plan assets must be covered, and more if there are assets that are not valued by markets daily (real estate, employer stock, limited partnerships, etc.)  At BRI we will advise you about your bond status and amount required to ensure sufficient coverage.
  • Annual filings – An electronic filing of a Form 5500 is required each year 7-months after the plan year end. The preparation of Form 5500 is included with our annual service and we will monitor its acceptance by the DOL to confirm timely filing; automatically requesting an extension, if necessary.


As the Plan Sponsor and employer, you have certain responsibilities to your employees when it comes to the retirement plan.  This checklist includes the following:

  • Enrollment – Once an employee meets the age and service requirements for the plan, they become a participant at the next plan entry date. Upon eligibility, the employee should receive a copy of the Summary Plan Description, and an enrollment kit including deferral election forms (for 401(k)) beneficiary election, and investment options (for participant-directed accounts)
  • Notices – 401(k) plans have a lot of potentially applicable notice requirements. For example:
    • Fee disclosure for individual participant-directed accounts
    • Safe Harbor notices
    • Qualified Default Investment Arrangement
    • Automatic Enrollment notice
    • Summary Annual Report (applies to all plans)
  • Distributions – upon termination from service, employees are normally eligible for a distribution. In some cases, the plan may require a waiting period before distributions are to take place.  Provide election forms to your former employees so they can receive their distribution when they elect to do so.  To keep fees as low as possible, small balances under $5,000 may be able to be paid out immediately without express consent from the participant.

For our clients, we provide projected enrollment reports, customized notices, and distribution election forms for our clients.  We work with our clients each year to identify and proactively force out small balances each year, if applicable, per the document requirement.


With our independent TPA services, you are free to invest your plan assets where you wish.  We do not sell investments, so we place no restrictions on your decisions.  Your financial advisor would assist you in reviewing and monitoring your plan investments and providing education to your employees about the investments in the plan. 


All plans are different, and yours is unique to your company.  Are you getting the support and advice that you want and need to get the most out of your plan?  At Benefit Resources we treat your plan as our own, pairing you with a dedicated, single point-of-contact who can help with all aspects of your plan’s operational administration.  We know you by name, not by account number!  If it’s been a while since you’ve taken a look at your plan, we’re happy to take some time to speak with you with no obligation or cost.  If you’re not sure a 401(k) plan works for your company or think the cost outweighs the expected benefit, we’re happy to run the numbers and find out!  Fewer and fewer people these days are adequately prepared for retirement and early planning is the solution.  We would be honored to help you determine if you’re on the right path or need to try something new!

Benefit Resources, Inc.


(916) 922-3200