Corporate Synergies Release Shocking Report on 5500 Non-Compliance

MT. LAUREL, N.J.--(BUSINESS WIRE)--Corporate Synergies recently released a new study, to be well publicized, based on data from the US Department of Labor. The study indicates that a shocking 49% of employers were improperly filing or failing to file their 5500 reports. This has stayed consistent in both of the years studied. Corporate Synergies’ new study reveals the following data from research of over 74,710 employers.

For those employers who were required to file 5500s, non-compliance ranges from 29 to 59 percent, depending on the employer’s size. Based on a comparison between 2003 and 2005 form 5500 filling data, the total percentage of non-compliance increased from 47% to 49%; however, total number of firms in the analysis dropped. The decreased number of firms may be the result of merger and acquisition activity during the two year period.

“If a company does not submit its 5500 form, it is vulnerable to costly fees,” warns Eric Raymond, CEO of Corporate Synergies. “Not only does the company face criminal penalties, but its plan administrator can be subject to daily fees of up to $1,100. It is imperative that employers take steps to submit this crucial form.”

About the Study

Corporate Synergies used data from filing year 2003 and 2005, provided by the Department of Labor, in their study. When the data was purchased on June 2007, the Department attested that it was 99.9% complete. A firm’s size was derived from the maximum value of active participants for a given plan for each Employer Identification Number (EIN). A plan could be any of the following:

• Medical Health Plan
• Dental Plan
• Vision Plan
• Group Life Insurance Plan
• Defined Benefit Plan
• Defined Contribution Plan
• Other similar plans

Location of a firm’s headquarters was determined by the state of the mailing address for each EIN. Each firm estimated to be larger than 99 employees was expected to file a Medical Health Schedule as part of its 5500 filing. Analysis was performed at the EIN level.

Firms could possibly have filed via their parent company. To account for this, a percentage allowance should be made. Firms that are larger than 1000 employees may appear to be out of compliance but are likely filing via a parent company or are self funded. Also, for those firms that are around 100 employees may not have every employee participating. Some schools, churches and government agencies did not appear to file a 5500; they were excluded from the study.

About Corporate Synergies Group, Inc.

Corporate Synergies is a full-service healthcare benefit solutions’ provider firm based in Mt. Laurel, NJ. The company a unique suite of services combined with innovative technology to deliver cost-effective benefit solutions to both employers and employees. Whether we’re helping to create paperless workflows, contain healthcare costs, or eliminate compliance burdens, Corporate Synergies provides true value. For further information visit www.CorpSyn.com.