TMS Offers Independent Directed Trustee Services to
Funded Health & Welfare Plans
TMS has a diverse client base consisting of many kinds of entities that require a Health and Welfare trust. Traditionally, we work with a broker who administers the plan, while we are the trustee of the funds. We accept contributions into the plan and then pay out based on premiums and claims, guided through the broker-administrator.
Basic Services Provided
- Banking Services
- Payment processing via wire, ACH or check
- View access to online banking if applicable
- Transaction Research
- Research on check clearance including check tracers
- Check copies
- Stop Payments
- Voiding Checks/Re-Issues
- Set up and reconciliation of automatic payment withdrawals and debits
- Purchase of Fiduciary Bond
- Quarterly Transaction Reporting on Trust activities
- SAR Preparation
- Government Reporting
- Form 5500 Preparation (small plan)
- Trust Income Tax Returns if applicable
- Preparation of Payroll tax returns through payroll service providers
- Preparation of 1099-NEC
- Data preparation for Audits of large Plans
Additional Services
- Form 5500 (large plan) assistance with audited financial statements
- We offer traditional accounting, auditing and tax compliance services through our parent company, Redwitz, Inc.
Understanding Compliance for a Funded Health and Welfare Trust
ERISA Compliance
- Health and Welfare plans are described in Title I of the Employee Retirement Income Security Act of 1974 (ERISA)
- Many Health and Welfare plans are fully insured and do not require an audit. In the case of TMS, we work exclusively with “funded” plans that do require an audit if there are more than 100 participants
- A funded plan is indicated by the establishment of a trust to hold assets and to pay covered benefits (medical, dental, vision, life, disability)
- ERISA does not dictate funding amount requirements to the trust.
- At times, participants may contribute to a portion of their benefits in a health and welfare plan, those funds do have a time requirement by ERISA to be deposited into the trust (no more than 90 days from the date withheld)
- All health and welfare plans have an annual Form 5500 filing requirement
- Trusts set up by TMS are “taxable” and require a trust income tax return if investment income exceeds $600 in any year
Compliance Reporting
- Annual Form 5500 filed with the Department of Labor (ERISA Requirement) – due 7/31 for calendar year plans
Reports annual financial activity of the Health and Welfare Plan - Annual Form 1041 Trust Income Tax Return filed with the Internal Revenue Service – due 4/15 for calendar year plans
- Reports investment income earned by trust investments
- Annual Form 1099-NEC filed with the Internal Revenue Service – due 1/31 for all plans
- Reports payments of fees in excess of $600 for the year to service providers that are not incorporated. Examples of service providers are: auditors, brokers, benefit providers
- W-2’s and related payroll tax returns – due 1/31 for all plans
