WHY
SMOOTH PEP
WHY SMOOTH PEP
The Smooth PEP is a Pooled Employer Plan (PEP) that allows unrelated employers to participate in a single professionally administered retirement plan. The Smooth PEP utilizes an independent PPP – and offers multiple PEP options to provide a customized solution for your business.
By centralizing administration, compliance, and many fiduciary responsibilities under a Pooled Plan Provider, the Smooth PEP can reduce costs and simplify retirement plan management while still giving employees access to a high-quality workplace retirement savings program.
Employers retain important responsibilities such as selecting and monitoring the Pooled Plan Provider and managing payroll contributions…but much of the operational complexity is handled by the pooled provider, making the Smooth PEP an attractive option for organizations seeking an efficient and scalable retirement plan solution.
The Advantage
Lower Administrative Costs
- Shared recordkeeping
- Shared compliance costs
- Economies of scale
Delegated Fiduciary Burden
Simplified Administration
The PPP manages:
- Annual Form 5500 filing
- Compliance testing
- Plan documentation
- Participant notices
- Operational administration
Better Buying Power
- Larger pooled assets may provide:
- Lower investment expenses
- Better pricing from service providers
- Expanded investment options
Easier Access for Small Businesses
Plan Sponsor Responsibilities
401(k) Plan
Responsibilities for Plan Sponsors
- Review, Sign and File IRS Form 5500 as Plan Administrator
- Review, Sign and File IRS Form 9855 as Plan Administrator
- Quarterly monitor 3(21) and 3(38) fund score cards
- Monitor investment changes with record keepers
- Review and monitor 408(b)(2) fees disclosures
- Review and monitor 404(a) (5)fee disclosures
- Montior service providers performance
- Ensure the plan document is in compliance at all times
- Review and adopt all plan amendments and restatements
- Monitor salary deferrals and loan payment are made timely
- Track eligibility
- Notify pion advisor of newly eligible
- Review and process complete election forms
- Authorize corrective refunds and distributions
- Receive, review and approve participants distributions
- Review vesting and update participant website
- Force out terminated employees under $5,000
- Evaluate participant eligibility for termination and retirement
- Determine required minimum distributions
- Evaluate participant eligibility for hardship distributions
- Authorize hardship distributions
- Receive, review and approve participants’ loan requests
- Act as recipient for QDRO submissions
- Determine validity and segregations of accounts for QDRO’s
- Oversee IRS and DOL audits and investigations
- Maintain all necessary plan records
- Receive Recordkeeping Emails and To-Do Lists
- Forfeiture monitoring
- Provide Quarterly payroll reports to Plans Sponsor
- Notify payroll of contribution rate changes
- Auto enroll and auto escalate tracking
- Onboarding monitoring and assistance
- Mail black out notices
- New plan mailings, SPD, Fee Disclosure and Plan Highlights
- Dedicated daily contact
- Upload payroll deferrals to record keeper
- Payroll monitoring
PEP
Responsibilities for Plan Sponsors
- Select and monitor the PPP
- Make contributions to the plan on a timely basis
Keep the PPP informed of the current employee census and of any changes in the employer’s business structure - Communicate availability of plan to newly eligible participants and ensure
deferral elections are set up in payroll
This information was developed as a general guide to educate plan sponsors but is not intended as authoritative guidance or tax or legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation. In no way does advisor assure that, by using the information provided, plan sponsor will be in compliance with ERISA regulations.
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