Americans now have another tool to track down money from their old retirement plans, but officials say the new government database still has a long way to go before reaching its full potential.
Regardless, the Department of Labor scored a major victory late last year when it secured approval to use IRS data to populate its new retirement plan lost and found database.
Congress, as part of SECURE 2.0 — a comprehensive retirement security bill passed in 2022 — mandated the DOL’s Employee Benefits Security Administration implement the database to help retirement savers and their beneficiaries find money they’re owed.
The database went live at the end of 2024, but there were some “roadblocks” along the way, said Lisa M. Gomez, who leads EBSA as assistant secretary for employee benefits security.
To populate the database, EBSA planned to use existing data from a filing known as Form 8955-SSA, which ERISA-covered plans are required to submit annually to the IRS.
That form notes a retirement plan’s former employees — known as "separated participants" — who have a vested account balance in the plan. The IRS then gives that information to the Social Security Administration and that agency notifies applicants for Social Security benefits about their existing benefits from their previous employer.
Roadblocks overcome
In April, the DOL noted that the IRS, an agency within the Treasury Department, said it could not authorize the sharing of Form 8955-SSA data, citing disclosure and confidentiality restrictions.
The DOL went another route in an attempt to get the data it needed, and in November began collecting information from plan administrators, record keepers and other service providers on a voluntary basis.
“We were concerned about whether or not we would be able to work out those issues but wanted to be making sure that we were able to stand up some form of a system,” Gomez said about the DOL seeking voluntary information from plans and record keepers.
But behind the scenes, officials from the DOL, IRS and Social Security Administration hammered out a way for the IRS to share the 8955-SSA data with the DOL.
Tim Hauser, EBSA's deputy assistant secretary for program operations, declined to get into the specifics on how the IRS went from “no” to “yes,” but said it took a lot of “good faith” work between the agencies.
“A lot of it was an awful lot of hard work, imaginatively thinking our way through all of the different ways in which the different agencies were constrained, and the different ways they had authorities, and finding a way through all of that stuff, a pathway that would actually just enable us to get this done,” Hauser said.
The IRS did not respond to requests for comment.
Kendra Isaacson, principal at Mindset, a Washington-based public policy consulting firm, said the DOL gaining access to 8955-SSA data is a big deal, but there’s more work to be done.
“I will say that’s better than nothing, but it’s still not dynamic, up-to-the-minute information,” said Isaacson, who previously helped craft SECURE 2.0 as the pensions policy director and senior tax counsel for Sen. Patty Murray, D-Wash., when Murray chaired the Senate Committee on Health, Education, Labor, and Pensions. “It’s only an annual form.”
Department officials made a similar point.
“Right now, the database is basically as good as the 8955 data is,” Hauser said. “To the extent that data is accurate and complete, so is the database. To the extent that data is outdated, or folks haven’t supplemented it or corrected it or fully complied with it, it’s not.”
Officials said few plan sponsors and record keepers have submitted data to the database thus far but hope that changes in the coming months and years.