how much money the plan ends up with at the end of the year depends on the amount they paid out to participants and the investment growth that was earned on the money as such shifts in the market can cause a fund to be either underfunded or overfunded 
pension plan reporting requirementspension reporting laws vary by country and jurisdiction these laws don t necessarily discriminate against plans that are overfunded however those plans may receive more scrutiny because of their status here are some reporting related requirements to be mindful of erisa is a comprehensive federal law that sets standards and regulations for private sector employee benefit plans including pension plans it was enacted in 1974 under erisa plan administrators are obligated to provide participants with detailed information about various aspects of the pension plan typically communicated through two key documents summary plan description and summary annual report 5form 5500 is a mandatory annual filing that plan administrators must submit to the u s department of labor this form serves as a comprehensive report on the financial condition investments and operations of the pension plan larger plans are also subject to an additional requirement of an annual audit meaning plans that are overfunded may find themselves facing additional requirements 6the pbgc is a federal agency that provides insurance protection to participants in private sector defined benefit pension plans plans covered by pbgc insurance are subject to reporting requirements to the pbgc pension plans must report certain events to the pbgc 7the irs plays a crucial role in overseeing the tax aspects of pension plans in addition to filing with the dol pension plans are required to file form 5500 with the irs this filing includes information relevant to tax compliance and is separate from the dol filing plan administrators are also required to provide regular statements to participants and any amendments to the pension plan or significant changes in plan status must be reported to the irs 8special considerationsin some cases defined benefit plans can become overfunded in the hundreds of thousands or even millions of dollars regrettably overfunding is of no use while in the plan beyond the sense of security it may provide beneficiaries an overfunded pension plan will not result in increased participant benefits and cannot be used by the business or its owners as mentioned above it s important for participants to understand that an overfunded plan won t correlate to higher benefits maintaining an overfunded status in the long term requires ongoing management and monitoring as the plan s funding status may quickly change changes in demographics workforce dynamics or economic conditions can impact the status and investing macroeconomic factors may cause the plan to lose funds via its investment choices 