Common Form 5500 Errors

Any administrator or sponsor of an employee benefit plan subject to ERISA must file information about each benefit plan every year via the Form 5500.  The Form 5500 is an annual report that is a part of the Employee Retirement Income Security’s Act (ERISA) that helps the Department of Labor (DOL) and IRS determine whether the employee benefit plans are operated and managed according to government standards. 

The Form 5500 needs to be filed electronically before July 31 every year.  This date is for Calendar Year plans that run from 1/1-12/31.  For non-calendar years, the filing date is due 7 months after their plan end date.  With the deadline occurring one time per year, it can be difficult for administrators or sponsors to avoid making mistakes, especially if they are overwhelmed by the process.

The BASE® 5500 Solver can help employers effectively prepare and file the Form 5500.  This comprehensive compliance solution generates custom compliant 5500 documents that allows an employer to easily prepare and file the 5500 form electronically each year. 

According to the IRS, an employer who enters in the wrong information, or accidentally leaves a field blank when filling out the Form 5500, could face an employee plan compliance check by the DOL.

Here are some of the most common errors when filling out and filing the Form 5500:

Noting “zero” plan participants. 

All eligible employees and employees with balances in the plan are considered participants. 

Excess deferral.

This error means that plan sponsors have allowed contributions to exceed the annual limit a participant is allowed to contribute. 

Plan termination.

Even if a plan has been terminated, the Form 5500 is still required until all assets are distributed from the plan.  Documenting terminated plans is a part of the annual reporting. 


If the Form 5500 asks if a plan has a loss caused by fraud or dishonesty.  This field should be left blank. 

Frozen plans.

Employers have been known to accidentally use Code 1/ for active accounts when that code is for plans that are frozen or non-active. 

Additional pitfalls. 

A few additional errors are incorrectly entering the EIN and plan number when filing, providing too much information such as returning over 12 months, or not using EFAST software or approved vendors. 

Because the Form 5500 requires such a significant amount of information, it is easy to enter in wrong codes or mistakenly leave sections blank.  However, when using a third-party administrator for your health and benefit needs, this provides some additional checks and balances to help employers effectively prepare to file this form, minimizing the plan-related workload and risk, and curtailing the common errors that could trigger a DOL audit. 

For more information on the BASE® 5500 Solver, contact BASE® at 888.386.9680 or visit

The Employer’s Guide to the ICHRA

Year after year, health care costs are on the rise and finding ways to cover those expenses can be challenging.  Yet, health insurance remains on top of the list for the most sought-after benefit by employees.  As an employer who wants to attract and retain talented employees, looking for ways to offer employees the health benefits they deserve without breaking your budget can be difficult.   

According to a Quest Diagnostics Report, more than three-quarters (77%) of employers say they want to lower health care benefit costs for their employees but don’t have the tools to do so. 

One option:  The ICHRA.  Find out what it is, how it works, the benefits, and the next steps in implementing it into the business. 

What is it?

The Individual Coverage Health Reimbursement Arrangement (ICHRA) gives employers of any size the ability to reimburse their employees for their qualified individual insurance premiums or insurance premiums and non-insured health care expenses.  Employers can choose to offer to all employees, or to specific classes, with no contribution caps, to fit any budget. 

The BASE® ICHRA is an IRS-approved tax savings plan that allows employers to offer a more personalized health benefit.   Employers can set a budget and create some predictability when it comes to health benefits, while providing a medical benefit without paying group benefit rates.

How does it work?

An employer designs the ICHRA for their business, establishing what is allowed for reimbursement and setting the contribution limits.  Once the ICHRA has been designed, classes established, and contribution limits set, employees can pick any individual health plan that fits their needs.  When the employee has a qualified health care expense, they can request reimbursement by submitting their receipts. 

The benefits?

The ICHRA provides a new level of flexibility to the employer and employee.  Employers can choose the level they want to contribute to the employees, as little or as much, as their budget allows, with employees choosing their individual health coverage that best fits their needs.  The ICHRA helps both the employers and employees save money each month.  Employers do not have to pay to provide a traditional group health plan to any or all employees, and employees have the additional money to help pay for their eligible expenses.  ICHRA reimbursements are tax-deductible for employers and employees receive their reimbursements tax-free. 

Next steps?

The employer calls and talks to a BASE® representative to see if the ICHRA is right for the business.  Whether a business has 15, 50, or 200 employees, an employer can leverage the cost savings and flexibility the ICHRA offers.

The ICHRA is a flexible cost-effective alternative to traditional group health benefits.  For more information on the BASE® Individual Coverage HRA, contact BASE® at 888.386.9680 or visit