Compliance Reminder
ERISA is a complex federal law, and employers should always seek guidance from qualified ERISA counsel or an experienced benefits consultant when applying these rules to their own plans. This content is provided for informational purposes only and does not constitute legal or tax advice.
Overview
Every ERISA-covered plan must have both a plan number and a plan year for identification and reporting purposes.
These elements are required on the Form 5500, the Summary Plan Description (SPD), and other ERISA disclosures, and they help regulators and auditors distinguish one plan from another.
In short, the employer’s plan number and plan year define which plan the employer is referring to – and which time period its reporting covers.
Plan Numbers: What They Are and Why They Matter
Each ERISA plan is assigned a unique three-digit plan number. This number identifies the plan across all official filings, disclosures, and participant communications.
- Welfare benefit plans (such as medical, dental, vision, life, and disability plans) typically begin with 501.
- Each additional welfare plan is numbered sequentially (e.g., 502, 503, 504, etc.).
- Retirement plans typically start at 001 and follow their own numbering sequence (e.g., 001 for the 401(k) plan, 002 for a pension plan).
The plan number remains permanent for that plan, even if benefits, carriers, or funding arrangements change. If the plan is ever terminated, the employer should not reuse that number for a new plan.
How Plan Numbers Are Assigned in Practice
Single Benefit Plans
If an employer has only one welfare benefit plan (for example, a standalone medical plan), that plan is typically assigned number 501.
Multiple Separate Plans
If the employer treats each benefit separately – medical as one plan, dental as another, life insurance as another – then each is assigned its own sequential number:
- Medical plan: 501
- Dental plan: 502
- Vision plan: 503
- Life and disability plan: 504
This approach can quickly create multiple ERISA plans and, if applicable, multiple Form 5500 filings.
Wrap Plans (Combined Plans)
Most employers choose to consolidate all welfare benefits into a single wrap plan, which “wraps” around all insured benefits and administrative arrangements.
The wrap plan then uses one plan number (usually 501) for all benefits combined.
This greatly simplifies documentation and reporting, since there is now:
- One ERISA plan number
- One plan year
- One SPD
- One Form 5500 filing (if required)
Plan Years: Aligning Dates for Consistency
The plan year defines the 12-month period used for plan administration, filings, and disclosures.
- Many employers align the plan year with the calendar year (January 1–December 31) for simplicity.
- Others may align the plan year with their policy renewal or fiscal year (e.g., July 1–June 30).
- The plan year must be consistent across all filings, SPDs, and benefit documents.
Aligning plan years across multiple benefits under a single wrap plan ensures all benefits operate on the same compliance calendar – simplifying Form 5500 reporting, SPD updates, and nondiscrimination testing.
Coordinating Multiple Plans and Participant Counts
If an employer maintains multiple separate welfare plans, each with fewer than 100 participants (for example, 55 in medical, 50 in dental), they may initially appear exempt from Form 5500 filing individually.
However, if the employer wraps them together under one plan for documentation or reporting, the total participant count is combined (in this case, 105).
Once wrapped, the plan becomes a single ERISA plan with 105 participants – triggering Form 5500 filing if it’s fully insured or unfunded, or automatically if it’s self-funded or level-funded.
Because wrap plans can change filing obligations, it’s critical to coordinate plan design, participant counts, and documentation before finalizing the structure. While wrap plans simplify compliance and administration, they may also push an employer above the 100-participant filing threshold.
Employers should consult qualified ERISA counsel or an experienced benefits consultant to confirm how their participant counts and benefit combinations affect Form 5500 filing requirements.
Best Practices for Plan Number and Year Management
To maintain consistency and reduce confusion:
- Assign welfare plan numbers beginning at 501 and increment sequentially only if maintaining separate plans.
- Use a single plan number (typically 501) for a consolidated wrap plan that includes multiple benefits.
- Keep the same plan number year after year – even when carriers, benefit options, or funding methods change.
- Align the plan year across all benefits included in a wrap plan.
- Ensure the same plan number and plan year appear on the SPD, Form 5500 (if applicable), and any Summary of Material Modifications (SMMs).
- Retain old plan numbers for terminated plans but do not reuse them.
- Rely on ERISA and/or tax counsel when identifying ERISA plan numbers and creating related documents and disclosures.
Key Takeaway
Plan numbers and plan years may seem like administrative details, but they are the anchors of ERISA documentation and reporting.
Using consistent numbering, aligning plan years, and coordinating benefits under a unified wrap plan creates clear, defensible records – simplifying compliance, supporting accurate Form 5500 filings, and reducing audit risk.
Employers should consult ERISA counsel or a compliance specialist before assigning new plan numbers or merging benefits under a single plan, to ensure the structure supports both compliance and administrative efficiency.