Legal Alert: DOL Opines on Plan Expense Reimbursement Credits

In Advisory Opinion 2013-03A (July 3, 2013), the Department of Labor opined that revenue sharing and similar amounts carried on the books of a retirement plan service provider as a credit due the plan, if properly structured, are not ERISA “plan assets” prior to receipt by the plan.

- It has become relatively common for retirement plan platform and certain other service providers that receive revenue sharing and similar amounts from plan investments to credit the plan some or all of those amounts, to be used for permissible plan purposes.

- Upon receipt by the plan, these amounts become ERISA “plan assets” subject to the “held in trust” and other applicable requirements of that statute.

- A question had arisen, however, whether these amounts, when received by the service provider and recorded on its books as a credit due the plan, become “plan assets” even before they are actually transferred to the plan.

Please see full alert below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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