Retirement plans are among the most regulated financial instruments that businesses offer their employees. ERISA, the Employee Retirement Income Security Act, sets the federal baseline for how plans must be structured, funded, and administered, and the Department of Labor continuously issues new rules and guidance that affect plan sponsors, trustees, and advisors alike. For CPAs who work with plan clients, staying current with ERISA developments is both a professional responsibility and a practical necessity.
Mandelbaum Barrett PC’s ERISA and employee benefits team advises employers, plan fiduciaries, and plan participants on the full range of retirement plan compliance and design issues that arise under federal law. Member Martin D. Hauptman will serve as an instructor at an upcoming New Jersey Society of Certified Public Accountants (NJCPA) course on ERISA, the Department of Labor, and retirement plan best practices. Learn more about ERISA and employee benefits legal services at Mandelbaum Barrett PC.
About the NJCPA Course
The course, titled “ERISA, the DOL and Building a Better Retirement Plan: Updates and Practices,” is designed primarily for CPAs in both public accounting and private industry, along with other professionals who advise employer-sponsored retirement plans. The curriculum addresses the evolving regulatory environment created by ongoing Department of Labor rulemaking and new interpretations of ERISA, with particular focus on practical strategies for structuring plans that maximize value for participants while staying within compliance requirements.
Attorney Hauptman’s participation as an instructor reflects a core principle that well-structured retirement plans require both legal and accounting input. CPAs who are current on the legal landscape are better positioned to advise their clients on plan design choices, contribution limits, and fiduciary obligations. Similarly, legal counsel who understands the accounting dimensions of retirement plans can provide more comprehensive guidance to plan sponsors and trustees.
Key Areas of ERISA Compliance for Plan Sponsors and Fiduciaries
ERISA imposes a layered set of obligations on plan sponsors, named fiduciaries, and service providers. Failure to comply with these obligations can expose the plan and its fiduciaries to significant civil and regulatory liability. The most frequently encountered compliance issues include:
- Fiduciary duty — ERISA requires that plan fiduciaries act solely in the interest of plan participants and beneficiaries, with the prudence applicable in the field, and that they avoid prohibited transactions with parties in interest
- Plan document compliance — the plan must be maintained in a written document that conforms to ERISA and the Internal Revenue Code, and must be restated or amended within required timeframes
- Annual reporting — covered plans must file Form 5500 with the IRS and DOL annually, and plans subject to audit must engage an independent qualified public accountant
- Distribution and vesting rules — ERISA sets minimum standards for when employees become vested in their benefits and when distributions may be made from the plan
The Department of Labor’s Employee Benefits Security Administration enforces ERISA and regularly issues guidance through regulations, advisory opinions, and field assistance bulletins. The DOL’s Employee Benefits Security Administration website is the primary source for current regulatory guidance and enforcement priorities relevant to retirement plan compliance.
Recent DOL and ERISA Developments Affecting Retirement Plans
ERISA’s requirements have expanded significantly over the decades since the law was enacted in 1974. Recent developments have included enhanced disclosure requirements for service provider fees and investment expenses, new guidance on the use of electronic means to deliver required notices to plan participants, expanded fiduciary standards governing investment advice, and updated rules governing hardship distributions from 401(k) plans. Plan sponsors who rely on last year’s compliance framework may find themselves out of step with requirements that have since changed.
CPAs who serve as plan auditors or who advise plan sponsor clients have a professional stake in staying current with these changes. Attorney Hauptman’s instruction at the NJCPA course is designed to bring legal clarity to areas where regulatory language can be ambiguous and where the consequences of getting it wrong are substantial for both the plan and its sponsor.
Martin D. Hauptman’s Practice and Background
Martin D. Hauptman is a member of Mandelbaum Barrett PC whose practice focuses on ERISA, employee benefits, and estate planning. He has worked with plan sponsors, trustees, and plan participants on retirement plan compliance, design, and administration matters, as well as estate and trust matters for individuals and families. His selection as an instructor at the NJCPA course reflects the breadth of his engagement with the intersection of tax law, retirement planning, and employee benefits regulation.
What is ERISA and who does it apply to?
ERISA, the Employee Retirement Income Security Act of 1974, is the primary federal law governing employer-sponsored retirement plans and certain other employee benefit plans. It applies to most private-sector employers who offer retirement plans such as 401(k)s, pension plans, and profit-sharing arrangements, as well as to certain health and welfare benefit plans. ERISA establishes minimum standards for plan funding, vesting, fiduciary conduct, and participant rights, and it is enforced by both the Department of Labor and the Internal Revenue Service.
What does it mean to be a fiduciary under ERISA and what are the consequences of a breach?
Under ERISA, a fiduciary is any person who exercises discretionary authority or control over a plan’s management or assets, or who provides investment advice to the plan for compensation. Fiduciaries must act solely in the interest of plan participants, with the care and prudence a knowledgeable person in a similar role would apply in similar circumstances. A breach of fiduciary duty can result in personal liability to restore losses to the plan, disgorgement of profits, and in some cases, removal from the fiduciary role.
What is Form 5500 and which retirement plans must file it?
Form 5500 is the annual report that most employer-sponsored retirement plans must file with the Department of Labor and the IRS. It provides information about the plan’s financial condition, investments, and operations. Plans with 100 or more participants at the beginning of the plan year are generally required to have an audit conducted by an independent qualified public accountant and attach the audit report to the filing. Smaller plans may qualify for simplified filing requirements, but most plans with employer contributions are subject to some version of the Form 5500 obligation.
How can employers reduce legal exposure when sponsoring a retirement plan?
Employers can reduce their exposure by ensuring the plan document is current and in compliance with applicable law, conducting regular reviews of service provider fees and investment options against a documented process, maintaining records of fiduciary decisions and the rationale behind them, and working with both legal counsel and a qualified CPA to monitor compliance obligations on an ongoing basis. Many plan compliance failures can be corrected through the IRS or DOL’s voluntary correction programs, but correction is always more costly and disruptive than prevention.
Contact Mandelbaum Barrett PC
If your organization sponsors a retirement plan or if you advise clients who do, Mandelbaum Barrett PC’s ERISA and employee benefits team can help with plan design, compliance review, fiduciary guidance, and related legal matters. To connect with Attorney Hauptman or another member of the benefits team, contact Mandelbaum Barrett PC online.