Save money every year on your 5500 Form Filing costs by bundling all your plans into a single plan using our Wrap Document services. Forget about having to pay for and file separate 5500 Forms for each of your company benefits. With a Diversified Administration, Inc. Wrap Document, you’ll save time and money, and you’ll get these savings each and every year going forward.
A wrap document combines all of your ERISA plans into a single plan with one plan number. That way, you have an Employee Benefit Welfare Plan with several parts: life, health, dental, disability, etc. rather than a life plan, a health plan, a dental plan, a disability plan.
Administrators have long struggled with the question, “How many Form 5500s do we need to file?” Some practitioners believe that you need a separate Form 5500 for each different benefit offered, i.e. one for the life insurance, one for the health insurance, one for the dental insurance, etc. While that is definitely compliant, using that approach often results in increased costs, as the employer is billed for 3 or more Form 5500s per plan year instead of just one.
If your 5500’s are delinquent, then the savings you’ll achieve with a Wrap Document increases exponentially. Since the penalties are determined by the number of plans that you have, the Wrap Document provides the documentation that you need to prove that you have one plan and not five. The penalty under the Delinquent Filer Voluntary Compliance Program is $2000 per plan per plan year up to a maximum of $4000 per plan. If someone has 1 plan, their penalty would be $4000. If they have 5 plans, their penalty would be $20,000.