A plan sponsor is typically the employer or a designated employee of an organization that sets up the retirement plan for the organization and its employees. A plan administrator, on the other hand, is a designated party tasked with the responsibility of running the plan.
Consequently, what are the responsibilities of the plan sponsor?
Communicate with your plan service provider
- New hires, re-hires, terminations and compensation changes.
- Accurate payroll compensation amounts for each participant.
- Census data for determining plan eligibility and benefit payments.
- Data necessary to accurately identify highly compensated employees.
Likewise, people ask, which of the following is a retirement plan sponsored by an employer?
Answer Expert Verified. The correct answer is 401(k). Under this plan, the employee and their employer both contribute to the employee’s account. Upon retirement, the employee receive the balance in their account, which is based on contributions plus or minus investment gains or losses.
What is a pension sponsor?
Pension Sponsor
A company that establishes and/or manages a pension for participating employees. It may be, but is usually not, the same as the company that employs the participants.
Are all 401ks employer sponsored?
About 80 percent of full-time workers have access to employer-sponsored retirement plans — the majority of which are 401(k)s — according to the American Benefits Council. … If you’re one of the 20 percent who do not have access to employer-sponsored 401(k)s, don’t worry!
Who is responsible for decision making in an employer sponsored governmental plan?
If an employer contracts with a plan administrator to manage the plan, the employer is responsible for the selection of the service provider, but is not liable for the provider’s decisions.
Is a plan sponsor a fiduciary under ERISA?
Under ERISA, when a plan sponsor is acting as a fiduciary, it must do so in the best interests of plan participants and their beneficiaries. Who is a fiduciary? Many of the activities involved in operating a plan make the person or entity performing them a fiduciary.
Who prepares the Form 5500?
The IRS, Department of Labor, and Pension Benefit Guaranty Corporation developed the Form 5500-series returns for employee benefit plans to satisfy annual reporting requirements under ERISA and the Internal Revenue Code.