Most small employers—those with fewer than 100 participants in a health or welfare benefit plan—are exempt from filing Form 5500, as long as the plan is unfunded (i.e., benefits are paid directly by the employer or through insurance, without holding plan assets in a trust).
Who qualifies for the exemption:
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Fewer than 100 participants at the start of the plan year
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Plan is fully insured, unfunded, or a combination
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No separate trust or plan assets are maintained
Exceptions:
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If the employer establishes a funded plan (e.g., setting up a trust to hold employee contributions), filing may be required regardless of size.
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Employers using a Wrap plan that includes multiple benefits under one ERISA plan may hit the 100-participant threshold across all benefits combined.
Even if Form 5500 isn’t required, the employer is still subject to ERISA and must comply with SPD and other disclosure rules.