Small unfunded or insured welfare plans with under 100 participants are generally exempt.
The DOL exempts welfare plans with fewer than 100 participants at the start of the plan year from the annual report when they are unfunded, insured or both.
What qualifies.
Under 100 Participants
The count is taken on the first day of the plan year.
Unfunded or Insured
Benefits paid from the general assets of the employer, from insurance, or both qualify.
No Trust
A plan that uses a trust or separate fund generally does not qualify.
Common traps.
Growing Past 100
When the count reaches 100 on the first day of a plan year, the plan files.
Participant Definition
Participants include eligible employees and some former employees with benefit rights.
Employee Contributions
Employee contributions that go into a trust can take a plan out of the exemption.
Still Keep Records
Exempt plans still need plan documents and must provide them on request.
Quick answers.
Short answers. This is general information, not legal or tax advice.
Do small plans file anything?
Generally not a Form 5500 when the exemption applies.
What if we miss the 100 count?
The plan files for the year the count is reached.
Do we need a plan document?
Yes. ERISA still requires written plan documents and a summary plan description.
Where the rules and figures come from.
Each figure on this page comes from the source below. Amounts are indexed or updated over time, so confirm current figures before relying on them.
29 U.S.C. 1132
ERISA Section 502(c)(2): civil penalty for failure to file the annual report.
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