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Word
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Definition
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Fiduciary
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Fiduciary: ERISA defines a person or entity as a plan fiduciary if that person: (1) exercises any discretionary authority or discretionary control respecting management of the benefits plan, or disposition of its assets; or (2) has any discretionary authority or discretionary responsibility in the administration of the benefits plan.
Fiduciary Duties: ERISA imposes duties on fiduciaries by statute which incorporate principles from the law of trusts. These responsibilities include:Acting solely in the interest of plan participants and their beneficiaries and with the exclusive purpose of providing benefits to them;
Carrying out their duties prudently;
Following the plan documents (unless inconsistent with ERISA);
Diversifying plan investments; and Paying only reasonable plan expenses. See, 29 U.S.C. Section 1104(a).
A fiduciary that breaches the foregoing duties "shall be personally liable to make good to such plan any losses to the plan resulting from each such breach, and to restore to such plan any profits of such fiduciary which have been made through use of assets of the plan by the fiduciary, and shall be subject to such other equitable or remedial relief as the court may deem appropriate, including removal of such fiduciary." Nonetheless, a fiduciary will not be liable if the breach was committed "before he became a fiduciary or after he ceased to be a fiduciary".
See, 29 U.S.C. Section 1104(a).
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Form 5500
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Form 5500: Each year, pension and welfare benefit plans generally are required to file an annual return/report regarding their financial condition, investments, and operations. The annual reporting requirement is generally satisfied by filing the Form 5500 Annual Return/Report of Employee Benefit Plan and any required attachments. See, Form 5500 page.
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