We can allow you to focus 100% of your efforts on driving and growing your business, let us, as the experts, run your retirement plan.
What is a 3(16) Fiduciary?
Under the Employee Retirement Income Security Act of 1974 (ERISA) specific fiduciary duties are outlined for the Plan Administrator. Section 3(16) of ERISA defined the individuals who may serve in this role. Most commonly the role of a Plan Administrator is served by the Plan Sponsor for practicality. However, Plan Sponsors can hire an independent 3(16) Fiduciary to act as the Designated Plan Administrator (DPA). They will be responsible for managing the day-to-day operations of the plan.
How is a 3(16) Fiduciary different from a TPA?
The main difference between a 3(16) Fiduciary and a third-party administrator (TPA) is the level of discretion that they can exercise with the administration of the plan. With a TPA the Plan Sponsor retains most of the discretionary control, only delegated some minor administrative duties to the TPA, whereas with a 3(16) Fiduciary they can takeover all duties and full discretionary control from the Plan Sponsor.
Why does your business need 3(16) services?
A 3(16) Designated Plan Administrator will allow you to outsource various daily administrative functions related to the plan thus freeing yourself to focus more closely on your business. It’s a cost-effective way of ensuring that your plan administration is done correctly while saving time, saving money and reducing your liability and risk of an IRS audit and/or penalties.