SunGard Relius

EFAST2 Credentials

In our continuing series of FAQs on EFAST2, we are addressing the issues and procedures with which 5500 preparers and plan sponsors will need to familiarize themselves to make the transition to electronic filing. After selecting the method a preparer will use to enter the data on the forms, the next step will be obtaining the proper electronic credentials. The following FAQs address the types of credentials required, how to obtain the credentials, and restrictions on sharing the credentials.

How does a plan sponsor obtain electronic signature credentials?

The plan sponsor will go to a DOL website (IREG) and enter certain personal information. The plan sponsor then will receive an email with a link to a website where he/she will receive the credentials (signer ID and pin code).

If more than one company or organization official is eligible to sign the Form 5500, will each official need to obtain electronic credentials?

Yes. The credentials are personal to the individual obtaining the credentials and the individual may not share the credentials. Furthermore, the credentials are “owned" by the individual and not by the plan sponsor. Accordingly, if more than one company or organization official may sign a Form 5500, each official will need to obtain his/her own credentials.

Besides signer credentials, which other credentials may be necessary under EFAST2?

Which credentials a 5500 preparer will need to complete a Form 5500 under EFAST2 will depend on which part of the Form 5500 and schedules the preparer completes and which system he/she uses to complete the forms. A preparer that prepares a Form 5500 using the DOL’s web-based system will need filing author credentials. The filing author credentials will permit the preparer to complete a Form 5500 and the accompanying schedules. The filing author credentials also will permit the preparer to submit the filing and determine if the filing has been accepted. If the filing author would like to delegate responsibility to another preparer to complete one or more schedules, the other preparer will need to obtain schedule author credentials.

A preparer using third-party software will not need filing author or schedule author credentials. Because of the restriction on sharing signer credentials, generally, only an employer preparing its own Form 5500 and schedules will be able to use third-party software to prepare and transmit the forms directly to the DOL via the internet. Instead, the preparer either will use a third-party web-based system or he/she will use third-party software and upload it to IFILE. A preparer that uses third-party software to prepare the forms and then uploads the forms to IFILE will need to obtain filing author and schedule author credentials.

A preparer using a third-party web-based system will not need to obtain any credentials. Of course, the company official signing the filing will need signer credentials.

Under which filing systems, will a 5500 preparer need to obtain transmitter credentials?

An in-house preparer (e.g., filing for their own plan) that uses third-party software to prepare a Form 5500 (and schedules) and files it directly with the DOL will need to obtain transmitter credentials. However, 5500 preparers that use a third-party web-based system, IFILE, or third-party software uploaded to IFILE will not need to obtain transmitter credentials.

The following chart will assist preparers in determining which credentials are necessary for different types of systems:

* A plan only will need a Schedule Author if a preparer other than the Filing Author is completing a schedule. For example, the preparer completes the Form 5500 and all schedules other than the Schedule SB which is prepared by an actuary. In such a case, the actuary would obtain Schedule Author credentials to complete the schedule.

How will a 5500 preparer obtain filing author, schedule author, or transmitter credentials?

The preparer will go to the DOL website (IREG) and enter certain personal information. The preparer then will receive an email with a link to a website where he/she will receive the credentials (ID and pin code).

May a preparer or plan sponsor use the same email address to obtain credentials for more than one person?

No. The DOL limits one set of credentials to an email address. An individual may obtain more than one credential (filing signer, filing author, schedule author, or transmitter). However, more than one individual may not use the same email address to obtain credentials.

Under IFILE, will a preparer be able to invite the plan sponsor official who will sign the Form 5500 to the electronic signing ceremony if the official does not have signer credentials?

No. Apparently, IFILE will block the preparer from sharing the filing with the signer. The preparer would then need to contact the signer and encourage him/her to obtain the signer credentials. The same obstacle would apply to a preparer using third-party software that uploads the data to IFILE. This obstacle, however, would not apply to a preparer using a third-party web-based system. Under a third-party web-based system, the preparer could invite the company official to the signing ceremony and if the company official does not have credentials, the same email could provide instructions for obtaining the credentials and a link to IREG.

Under IFILE, does a preparer with filing author credentials have the ability to complete the Form 5500 and any of the schedules?

Yes. Therefore, if the filing author is able to complete the Form 5500 and the schedules, no individual will need to obtain schedule author credentials for that plan. However, if the filing author needs assistance in completing one or more schedules (e.g., Schedule SB), the preparer will need to invite a schedule author. Of course, under a private web-based system, there are no filing author or schedule author credentials. The firm or institution preparing the Form 5500 and schedules will have complete control over who participates in the preparation of the forms.

Under IFILE, may a filing signer complete or modify a form or schedule?

No. The filing signer may not complete or modify a form or schedule. Under a private web-based system, the preparer will be able unlock all or any portion of any form or schedule to permit another preparer or the filing signer complete or modify the unlocked portion of the forms.

If an employer obtained filing signer credentials under EFAST, may the employer use those credentials under EFAST2?

No. The employer must obtain new filing signer credentials for EFAST2.

When will IREG website be available?

January 1, 2010.

5500 Workshop/401(k) Workshop. In our upcoming 5500 workshop, not only will we address all of the important questions and issues in the 5500, 5500-EZ, and schedules, we also will explain how to use and prepare effectively for EFAST2. We also have scheduled our 401(k) Plan Workshop to follow the 5500 Workshop. The topics for the 401(k) Workshop include the Suspension of the Required Minimum Distribution; PPA ’06 Technical Corrections; New Guidance of Permissive Disaggregation; Safe Harbor 401(k) Plan Design; Participants in Financial Difficulties: loan defaults, hardship distribution and QDROs; and Complex Testing of Ordinary Allocations; and Penalties and Additional Income Taxes. For more information on the seminars, click here.