What an owner should read before signing the 2025 Form 5500

The 2025 Form 5500, for a calendar-year plan, is due July 31, 2026. An extension on Form 5558 moves that date to October 15, 2026. May is when drafts start to circulate, and May is the right month to read one. The plan administrator signs the return. In a professional practice the administrator is often the owner, personally, not the third-party administrator who prepared the file and not the enrolled actuary who certified the funding schedule. Do not sign a Form 5500 you have not matched to the trust statement, the census, and the contribution you actually sent.

Sterling Pension Group LLC in West Hartford prepares administration work as a third-party administrator. We are not an actuarial firm. Where Schedule SB is required, an independent Enrolled Actuary certifies it. We are not the signer of your Form 5500 unless the document has named us, which it should not have done casually. This briefing is not tax, legal, or actuarial advice. It is a reading list for the person whose name is about to go on the filing.

What the form is

Form 5500 is the annual report of an employee benefit plan. The IRS, the Department of Labor, and, when the plan is covered, the Pension Benefit Guaranty Corporation all have an interest in it. Filing is electronic, through EFAST2. A PDF in a drawer is not a filing. The IRS maintains a Form 5500 corner. The Department of Labor explains the same obligation from the fiduciary side on its Form 5500 reporting page. Read those pages if you have never seen the form. They will not interpret your draft. They will stop you from thinking of it as a formality the vendor handles in the background.

A defined benefit plan, including a cash balance plan, attaches an actuarial schedule. That schedule is Schedule SB. The enrolled actuary signs it. You do not. Your signature on the Form 5500 is a different act. You are representing that the return, including its schedules, is complete and reasonable based on the administrator's knowledge. "The actuary signed the SB, so I signed the front" is not a reading. The defined benefit structure is why the SB is there at all. A pure 401(k) filing looks different. If you sponsor both, you may have two filings, and signing one does not sign the other.

Small plans and large plans do not file the same richness of financial information. The usual dividing line is 100 participants at the beginning of the year. Plans in the 80-to-120 range sometimes keep filing as they did the prior year under a transitional rule. Crossing 100 can bring an independent qualified public accountant's audit. That audit is not the actuarial valuation. It is a separate engagement, with a separate calendar. If your headcount is climbing toward that line, May is a better time to learn it than July 30. The administration scope should say whether an audit applies. If it does not say, ask.

The lines that are actually about you

Start with identity. Plan name, plan number, employer identification number, and plan year have to match the document and the trust. A return filed under the practice's old name, or under a number that belonged to a plan you terminated in 2018, is a return for the wrong plan. Mergers, a new entity, or a change of EIN at the bank are the facts that break this section. If you sold or bought a practice in 2025, stop and read the identity lines twice. The sale briefing is at /insights/selling-the-practice if the transaction is still open in 2026. The 2025 return still has to describe the year that happened.

Then read the participant counts. Active, retired, separated, and deceased are not one bucket. The count drives the small-plan question, and it should agree with the census you signed off for the valuation. A count that still includes an employee who left in 2023, or that omits a partner who entered in 2025, is a count that will not match next year's test. You are the person who knows who worked there. The preparer knows who was on the spreadsheet you sent.

Then read contributions. The return reports what was contributed. Your bank statement reports what left the operating account. The trust statement reports what arrived. Those three numbers are supposed to be the same amount, in the same year, allowing for a deposit made after December 31 that the plan and the deduction rules treat as belonging to 2025. If you contributed in January 2026 for 2025, the draft should not read as if the trust received nothing. If you contributed twice and one wire was for 2024, the draft should not add them into a single 2025 deposit. This is the most common owner-level error, and it is the easiest to see. Reconcile the dollar before you reconcile the narrative.

Then read the questions you hope are all "no." Late deferrals. Prohibited transactions. A fidelity bond that is missing or too small. A loss caused by fraud. An unfunded commitment. These questions are not decorative. A "yes" is not always a disaster. An unanswered "yes," or a "no" that is false, is how small problems become filing problems. If employee 401(k) deferrals sat in the operating account past the deposit deadline, the answer is not a matter of tone. The recordkeeper and the administrator should already have flagged it. Your job is to recognize the flag.

Schedule SB is attached, and it is not a duplicate of the statement

The cash balance statement shows a hypothetical account: pay credits plus interest credits, minus distributions. Schedule SB shows the funding target, the actuarial value of assets, the minimum required contribution, and the actuary's certification. Those pages will not match the statement dollar for dollar. They are not supposed to. If you hold the draft up to the statement and reject it because the numbers differ, you will be rejecting the right form. If you sign without asking what the minimum was, and whether you paid it, you will be signing the wrong way. A deposit range someone sketched before the actuary certified this draft is still illustrative. It is not a second minimum, and there is no flat IRS cash-balance contribution cap hiding behind it.

The minimum funding contribution for the 2025 calendar plan year is generally due September 15, 2026. That date is later than the unextended Form 5500 deadline and earlier than, or near, many extended tax-return dates. The deduction often follows the due date of the employer's 2025 return, including extensions, under the timing rule your CPA applies. These are different clocks. A contribution can be on time for the deduction conversation and late for minimum funding, or timely for funding and assigned to a different tax year than the one you intended. The Form 5500 reports plan facts. It does not compute your deduction. Publication 560 is the small-employer booklet that keeps plan types straight. Your CPA keeps the deduction straight.

Unpaid minimums are visible to an actuary and should be visible to you. A missed minimum generally draws an excise tax of 10 percent under section 4971 until it is corrected, and a harsher tax if it sits through a revenue notice. Signing a return that shows an unpaid minimum, without a plan to pay it, is a decision. Make it on purpose. The deadline calendar should already show July 31, September 15, and October 15. If the only date on your wall is the practice's tax extension, the pension clocks are not on the wall.

The actuary also certifies a funded percentage that can restrict benefits when it is too low. You do not need to recompute it. You need to know whether the draft says restrictions apply, because restrictions change who can be paid and whether you can amend the formula. That subject gets its own briefing when we walk Schedule SB line by line. For the signature, the question is whether anyone has told you, in a sentence, that the plan is or is not restricted.

PBGC, the audit, and the extension

PBGC coverage is plan-specific. Many small professional-service plans are exempt. Not all. If your plan is covered, premiums are a separate filing and a separate check. They are not satisfied by filing Form 5500. If someone told you years ago that physicians are exempt, confirm that the exemption still fits this plan, this headcount, and this sponsor. The PBGC states the categories on its coverage page. Do not answer the coverage questions from memory of a seminar.

If an accountant's audit is required, the auditor's report is part of the filing package. You cannot file a complete large-plan return on the strength of the actuarial schedule alone. If the auditor is waiting on a trust statement you have not requested, the July deadline will arrive anyway. Form 5558 is the extension. It is filed in time, not after a failed attempt to upload. Extending to October 15, 2026 is appropriate when the audit or the valuation is actually in process. Extending because no one opened the draft is how October becomes a second crisis. The fees conversation should have told you who prepares the form, who signs the SB, and who pays the auditor. If those roles are blurry, clarify them before you are asked to sign.

Penalties for a late or incomplete annual report are assessed by the day, by more than one agency, and they are large relative to a professional-practice cash balance fee. The precise dollar changes with inflation adjustments, so this briefing will not quote a figure that will be stale next season. The direction is the point. "We will file it when the summer slows down" is an expensive sentence. The IRS Form 5500 corner and the Department of Labor page linked above are where the current penalty framework is described. Correcting a late filing through the programs those agencies offer is far cheaper than ignoring one. It is still not free, and it still starts with a return that is accurate.

A reading method that fits in an evening

Print the draft, or use a screen if you must, and read in this order. Identity and dates. Participant counts against your own recollection of who worked in 2025. Contributions against the trust statement and the wires. The actuary's statement of the minimum, and whether that minimum was deposited. The bonded-amount question. Any "yes" answer. The signature block, including the plan administrator's name and address. If a number does not match, write the question on the draft. Do not "fix" a participant count yourself in the margin and assume the rest of the return will follow. Counts flow into more than one line.

You are entitled to ask what a line means. A preparer who cannot explain a line in plain English has not finished the draft. You are not entitled to a different actuarial assumption because you dislike the contribution. The enrolled actuary selects assumptions that satisfy the funding rules. Pressure to lower the minimum by wishing the assets higher is not a review comment. Pressure to correct a census error is.

The 2026 limits do not rewrite the 2025 return. The return you are signing reports 2025. The limits that governed 2025 were a $23,500 deferral, a $7,500 catch-up, an $11,250 catch-up at ages 60 through 63, $70,000 of defined contribution additions, a $350,000 compensation cap, and a $280,000 defined benefit dollar limit, as announced in IR-2024-285. The 2026 limits, including the $24,500 deferral and the $290,000 benefit limit under IR-2025-111, govern 2026. Signing the 2025 form is not the moment to restate 2025 as if those newer ceilings had applied. If a draft uses 2026 limits to describe 2025 contributions, send it back.

What to do in the next two weeks

Ask the preparer for the draft, the Schedule SB, and the trust statement for December 31, 2025, in one package. If the draft is not ready, ask whether Form 5558 will be filed so the deadline is October 15, 2026 rather than July 31, 2026. Get a date.

Match three numbers yourself: assets on the return, assets on the trust statement, and contributions by plan year. Read every question that can be answered yes. Confirm who the plan administrator of record is.

If the minimum for 2025 is not yet in the trust, confirm the amount and the September 15, 2026 date with the actuary's work, and confirm with your CPA which tax year the deduction is supposed to hit. Then send us the questions the draft actually raised. A signature in July should be boring. Boring is available only if May is not.