‘Tis the Season for Annual Benefit Plan Notices by Sean Deviney, CFP

Posted on November 05, 2014 by Richard Berkowitz

The fourth quarter is an important time of year for businesses that administer 401(k) plans on behalf of their employees. Among their fiduciary responsibilities under the Employee Retirement Income Security Act of 1974 (ERISA), plan sponsors must distribute to plan participants important notices detailing relevant information that helps participants make informed decisions about their retirement accounts. For many businesses, the fourth quarter also marks the 401(k) open-enrollment period, the time when new employees sign up for benefits and existing employees review their plans and make changes to their investment choices, as needed. This period comes with its own set of reporting requirements for which plan sponsors must take the time to act accordingly to meet their fiduciary responsibilities.


Beginning with the 2014 tax year, 401(k) plans must recognize the court’s June 2013 decision regarding the Defense of Marriage Act and update their procedures to include same-sex couples by Dec. 31. In addition, plans considering adopting or renewing a Safe Harbor provision in 2015 have 30 days before the start of the plan year to notify employees of this election or risk exposure to discrimination testing and potential limits or refunds of contributions by highly compensated employees.


Before ringing in holiday cheer, plan sponsors should consider their reporting responsibilities and review the following summary of notices to distribute to eligible employees during the fourth quarter of the year.


Notice Description timing
Summary Plan Description (SPD) Vital information describing the name, type and benefits of the plan and the rights and responsibilities of plan participants  Within 90 days of a new employee becoming eligible for participation in the planand

Every 10 years to existing plan participants or every 5 years when sponsors amend plans

Automatic Enrollment (for plans that automatically enroll participants) How eligible employees are automatically enrolled in the plan and how their pay will be automatically contributed For new participants, 30 to 90 before the employer automatically enrolls the employee. 

For existing plan participants, Dec. 1 for calendar-year plans, or

no less than 30 days before the first day of the plan year for non-calendar plans

Eligible AutomaticContribution



Employees rights to make apermissive withdrawal and the

procedures for electing the withdrawal

30 to 90 days before thebeginning of the plan year
Qualified Default Investment Alternatives (QDIA) The rights of plan participants to direct their plan investments information about how contributions will be invested when participants do not make investment elections  For new employees, at least 30 days prior to plan participant date or date participant makes fist contribution 

For existing employees, 30 to 90 days prior to the start of the plan year

Participant Fee and Investment Notice (ERISA Section 404) Information regarding plan investment options, plan fees and expenses 30 days prior to a participant’s first contribution for investment, and 

Annually for existing participants with a plan balance

Safe Harbor Provisions (for plans that elected safe harbor provisions) Whether the employer will make matching or non-elective contributions, the amount of the contribution and the amount of compensation eligible for employer contributions 30 to 90 days prior to the beginning of the plan year
Summary Annual Report (SAR) Explanation of plan expenses and value of plan assets Within nine months of the plan’s year-end or December 31st, if extention is filed.


The fiduciary responsibilities of 401(k) plan sponsors are many. To act in the best interest of plan participants, rather than the employers sponsoring these plans, fiduciaries must remain vigilant in meeting their reporting requirements and keeping participants informed, if not excessively so. During this time of year, businesses may benefit from the counsel of retirement plan advisors, who can assist in minimizing compliance risks through reviews of year-end qualified-plan reporting deadlines and the delivery of notices to plan participants. Similarly, this time of year is ideal for employees to review their accounts, often with the help of professional investment advisors, to ensure their retirement savings are on track and aligned with their financial circumstances and goals.


The professionals with Provenance Wealth Advisors have extensive experience helping businesses of all sizes design, assess performance, improve employee participation and institute best practices in managing compliance with employer-sponsored benefits plans.

About the Author: Sean Deviney, CFP, is a financial advisor and retirement plan advisor at Provenance Wealth Advisors, an independent financial services firm affiliated with Berkowitz Pollack Brant Advisors and Accountants. For more information, call (954) 712-7000 or email

Provenance Wealth Advisors, 515 E. Las Olas Blvd., Ft. Lauderdale, FL 33301 (954) 712-8888.


The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete.

Securities offered through Raymond James Financial Services, Inc., Members FINRA/SIPC. Raymond James is not affiliated with and does not endorse the opinions or services of Berkowitz Pollack Brant Advisors and Accountants.