Mandatory Electronic Filing of Form 5500

The United States Department of Labor (DOL) has implemented an electronic filing system for all pension and welfare plans required to submit an annual return/report under Title I of ERISA (Form 5500 or Form 5500-SF). Beginning January 1, 2010, generally every Form 5500 or Form 5500-SF filing must be submitted through the new EFAST2 system. The purpose of this letter is to inform you of this change as well as guide you in the actions you will need to take in order to submit your Form 5500 or Form 5500-SF filing.

What Plans Are Affected - The EFAST2 filing requirement affects all 2010 filings of Form 5500 or Form 5500-SF for the 2009 tax year. The filing year for your plan is determined based on the first day of the plan year. The Form 5500-EZ for one-participant plans must still be filed on paper with the Internal Revenue Service (IRS), although eligible EZ filers can file Form 5500-SF.

How the Process Works - The most significant change is all signers must electronically sign the annual return prior to submission. The "Registration" section which follows discusses how to obtain the necessary credentials for completing this process.

In most cases, the third-party software used to prepare the return in the past has been approved for EFAST2 filing. Since 90% of filers have utilized third-party software, there will be minimal changes in the return preparation process. The mandated electronic filing of the returns means paper return preparation is no longer permitted. The DOL has created an application called IFLIE to assist filers who do not utilize third-party software to file their annual return.

Attachments such as a Schedule SB prepared by an actuary or the report of an independent qualified public accountant will need to be signed and saved as a Portable Document Format (PDF) file and attached to the return submission. In addition, forms such as Schedule SSA and the Form 5558 extension are no longer submitted with the Form 5500 filing but will be manually submitted to the IRS.

Once the return is ready for submission, those plan sponsors/administrators utilizing a third-party administrator or paid preparer (such as Malin Bergquist) will receive an e-mail which will invite them to apply their electronic signature to the filing. Once this "signing ceremony" has been completed, the filed return would be submitted to the DOL. As the DOL has mandated that registered PIN numbers not be shared, your preparer will not be able to complete this process for you.

Registration - Every individual plan administrator and/or plan sponsor must be registered to electronically sign the EFAST2 submission. Existing plan administrators will be provided instructions via mail from the DOL in the near future. You can begin registering for electronic credentials through the EFAST2 web site at www.efast.dol.gov. This process is fairly quick and can be completed in 15 minutes in most cases.

The registration involves the following steps and information:

1. Agreeing to a Privacy Statement.
2. Entering Profile Information (Name, address, phone, e-mail).
3. Selecting a User Type - for those utilizing a third party to prepare their return, the "Filing Signer" status would normally be the only type selected.
4. Selecting a Challenge Question to complete the Profile setup.
5. Shortly afterward you will receive an e-mail which provides a link to retrieve your PIN and UserID.
6. Click on the link and answer your Challenge Question.
7. Read and accept the agreement.
8. Your profile along with your User ID and PIN will appear. Please print this page then click Next to create a password.

We are encouraging plan administrators and sponsors to sign up for electronic credentials as soon as possible to avoid missing any filing deadlines due to potential difficulty obtaining these credentials. We would also encourage every plan administrator and sponsor to register an alternate signer in the event a credentialed signer is no longer associated with the plan or is unable to sign for any other reason.

Should you have any questions, please do not hesitate to contact one of the following individuals:

Erie Office:

Rod Coburn  - (814) 454-4008

Al Isacks  - (814) 454-4008

Pittsburgh Office:

Julie Keenan - (412) 364-9395

Greensburg Office:

Jeff Anzovino  - (724) 838-8322