The Form 5500 series remains a cornerstone of employee benefit plan compliance under the Employee Retirement Income Security Act of 1974 (ERISA). Administered jointly by the U.S. Department of Labor (DOL), the Internal Revenue Service (IRS), and the Pension Benefit Guaranty Corporation (PBGC), Form 5500 filings serve as the principal mechanism for regulatory oversight, disclosure, and enforcement across qualified retirement and welfare benefit plans. In December 2025, these agencies released informational draft copies of the 2025 Form 5500 series, including Form 5500, Form 5500-SF, IRS Form 5500-EZ, and Form 5558, accompanied by revised instructions. Although not yet approved for filing, these drafts signal meaningful compliance changes that plan sponsors, fiduciaries, and professional advisers must anticipate.

One of the most significant proposed updates is the expansion and refinement of plan characteristic codes. New codes 1J, 1K, and 1L have been introduced to identify multiemployer defined benefit plans that have terminated due to mass withdrawal, plan amendment, or insolvency, respectively. Additionally, code 1G has been added to designate defined benefit plans utilizing a variable annuity benefit formula. Concurrently, existing code 1H has been narrowed to apply exclusively to terminated single-employer PBGC-covered plans. These revisions enhance the precision with which regulators classify plans experiencing financial distress or structural transition, reflecting broader federal concern regarding multiemployer plan solvency and systemic pension risk.

These refinements carry practical implications beyond reporting accuracy. For compliance professionals and risk intermediaries, improved plan classification facilitates more granular regulatory analysis, enforcement prioritization, and actuarial assessment. From a surety and fidelity perspective, clearer identification of terminated or distressed plans enables more informed underwriting decisions, particularly where bonding obligations may arise in connection with plan termination, fiduciary misconduct, or asset disposition. Enhanced transparency thus supports both regulatory objectives and market discipline.

The draft instructions also incorporate updated references to maximum civil penalties under ERISA Section 502(c)(2), adjusted pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. These adjustments highlight the increasing financial implications of late or deficient Form 5500 filings. As penalty exposure continues to rise, timely and accurate compliance becomes increasingly critical for plan fiduciaries and their advisers, particularly in an environment of heightened enforcement scrutiny.

It is essential to note that the 2025 Form 5500 drafts are informational only and should not be used for filing purposes, YET. Finalized forms and electronic filing specifications will be released through the EFAST2 system at a later date. Nonetheless, early awareness of these changes allows firms to proactively align compliance calendars, advisory guidance, and risk management frameworks ahead of the 2026 filing cycle.

In this evolving regulatory environment, Surety One, Inc. stands as the premier provider of ERISA fidelity bonds, offering specialized expertise at the intersection of employee benefit compliance, fiduciary risk, and statutory bonding requirements. By combining deep regulatory knowledge with responsive underwriting capabilities, Surety One, Inc. plays a critical role in helping plan sponsors and fiduciaries satisfy ERISA bonding obligations while navigating increasingly complex reporting and enforcement regimes. As Form 5500 protocols continue to evolve, access to experienced ERISA bond expert and placement expertise remains an essential component of prudent plan governance.

~ C. Constantin Poindexter, MA, JD, CPCU, AFSB, ASLI, ARe

Bibliography

  • Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001–1461.
  • Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, Pub. L. No. 114-74, 129 Stat. 584.
  • Pension Benefit Guaranty Corporation, Department of Labor, and Internal Revenue Service. Draft 2025 Form 5500 Series and Instructions. Washington, DC, 2025.
  • Plan Sponsor Council of America. “Agencies Release Draft Copy of 2025 Form 5500.” PSCA News, December 2025.